LFMI staged a press conference to present measures which would help prepare for and curb a pending rise of unemployment. According to LFMI, in the course of an economic crisis, simplification and flexibility of employment regulation would lessen pressure for employers and, most importantly, employees.
As data from the Lithuanian Labour Exchange shows, the number of people seeking employment went up by 30 percent in October 2008, compared to October 2007, while jobs created decreased by 26 percent.
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Such figures signal that lay-offs will become more frequent already from the start of 2009.
The Institute highlighted that under such circumstances flexibility in the labour market was vital as never before, reminding that other countries predominantly launch reforms to increase flexibility when the situation in the labour market becomes especially acute.
The Lithuanian Labour Code has been acknowledged as rigid and inflexible both by Lithuanian businesses and foreign specialists. Therefore, LFMI proposes not to apply specific provisions of the Labour Code when employers and employees agree individually or collectively. For instance, the Institute recommends that employers and employees were allowed to agree individually on various aspects of working time – the duration of working day and working week, overtime work, vacations or the terms of firing. In addition, labour market participants should be allowed to agree collectively and not to comply with the Labour Code’s rules regarding the introduction of summary recording of working time, payment for overtime work, night work or work on national holidays.
LFMI also proposes to simplify the procedures of concluding labour contracts. More to that, it would be expedient to discard privileges applied to trade unions,
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which undermines employers’ incentives to establish trade unions.
