Bank employees union Etyk has initially accepted a Labour Ministry mediation proposal for the renewal of collective contracts but bank workers will have the final say during regional meetings on Wednesday.
Etyk on Monday said its board had during an extraordinary meeting evaluated and initially accepted the proposal, with informed sources also saying that the banking sector's employer association Kest was also in favour. Kest is also expected to make its official position known to the Labour Ministry by tomorrow, the deadline set for both sides to state whether or not they would be accepting the mediation proposal.
The Labour Ministry's plan of action includes pay cuts of up to 14%, a reduction in allowances, the freezing of pay rises and the Cost of Living Allowance (COLA) as well as a three-year extension of the retirement age to 65.
On the sticking point of contributions to the solidarity fund, the proposal suggests a 2% employer contribution based on a staff-member's monthly salary, set off by reducing the employer's contribution to the provident fund from 14% to 9% on 2014 and 2015 salaries, increasing to 9.5% of the salaries in 2016 and 11.5% in 2017.
The collective agreement will have a three-year duration from January 1, 2014 to December 31, 2016.
Once agreed on, the agreement will be enforced by all Kest members. Recently the Bank of Cyprus and the Cooperative Central Bank left the association. The Bank of Cyprus' new board has over the last few days been in negotiation with Etyk over the renewal of its collective agreement with employees.
Employees there have been subjected to pay and benefit cuts since the Bank of Cyprus came to a temporary agreement with Eyk last summer. The Labour Ministry mediation concerning the other banks came about after Etyk and Kest' negotiated for over two months without result.