Innovative Labour Market Measures to Fight the Crisis Prague, Czech Republic October 20 – 21, 2011

Content Labour market situation The objectives of the PES Specific tools Significant results Recommendations 2

Labour market situation Rate of unemployment of Czech Republic regions on 30 th June 2008 Rate of unemployment in % and above 3

Labour market situation Rate of unemployment of Czech Republic regions on 31 st December 2009 Rate of unemployment in % and above 4

Labour market situation Unemployment rate Job seekers Job vacancies Job seekers per Job vacancy 2008/06/ /12/ % 9.2 %

Objectives of the PES To react to a higher risk of mass lay-offs due to lower demand and scaled down production. To react to a situation when companies lose skilled human resources. To sustain a qualified labour force in companies affected by the economic crisis. 6

Objectives of the PES To decrease the risk of degradation of the work habits and competencies of dismissed workers. To use the crisis as a suitable opportunity for training. The crisis is a period of structural changes and, therefore, it is important to prepare the labour force for the future needs of the economy. 7

Specific tools 1.Legislative measure: ARTICLE 209 LABOUR CODE 2.Tool of Active Employment Policy: COMMUNITY WORK 3.Projects financed by ESF:  RESTART  THE TRAINING IS A CHANCE  GET TRAINED! 8

ARTICLE 209 LABOUR CODE 9 In response to temporary drop in demand employers can apply to the Labour office for permission to retain employees at 60 % of their salary. Employers may take advantage of § 209 only for short term periods (up to one year).

ARTICLE 209 LABOUR CODE 10 Employees work fewer days or stop working without the opportunity to improve their skills set. This is an expensive solution for employers. 850 companies applied in 2010 and kept 37 thousand employees at 60 % pay.

COMMUNITY WORK 11 In reaction to the dramatic drop in job vacancies in the Private Sector, labour offices created new jobs in the Public Sector. Jobs in general maintenance of public spaces and public services.

COMMUNITY WORK 12 Short term job opportunities for the disadvantaged and those with a low skillset in long term unemployment. The number of job vacancies created by the PES in the Public Sector in 2008 and X20 961

ESF cofinancing projects The Czech PES used the resources from the European Social Fund (ESF) to finance projects through two Operational Programmes. Both Operational Programmes were focused on minimization of unemployment by means of active policy on the labour market. 13

RESTART Tool implemented by the Ministry of Labour and Social Affairs. This programme is realised by the particular projects of the Labour Offices in regions. It is focused on the employees endangered by the loss of employment. 14

RESTART The main objective is to retrain employees before severance of the labour relation. The specific objective is to provide to these people the opportunity to improve their qualification profile for future use. The total budget for the 9 projects provided by the 8 Labour offices was 396 millions CZK. 15

THE TRAINING IS A CHANCE The second tool is focused on general and vocational training. It supports comprehensive projects for the training of employees and of human resources management within companies. This programme is prohibited for the companies that applied for GET TRAINED! and companies ”in difficulties”. 16

THE TRAINING IS A CHANCE The total budget of the project is 4.5 billion CZK. The total amount requested reached almost 8.6 billion CZK. There have been 1093 successful applications (from 1803 total applications) covering 150 thousand employees. 17

GET TRAINED! This project has been implemented as a pilot tool of the Active Employment Policy in two phases. The first phase began in March 2009 and finished on 30 th June The second phase then began and finished by the end of

GET TRAINED! The PES of the Czech Republic were responsible for conception and strategy making, dissemination of the projects and evaluation. The implementation was decentralised! (Through 76 Labour offices - except Prague.) 19

GET TRAINED! The key point is that the local labour offices also assessed and approved applications. 20

GET TRAINED! The Labour offices consider the relevance of applications and sign the contracts. Employers submit their application for participation in the project at their local Labour office. 21

GET TRAINED! The application must contain the relevant reasons for their participation in this project. Importantly: Had to reduce production, while employees had to accept to work fewer days or stop working for a certain period of time in reaction to impact of the crisis. 22

GET TRAINED! Employers receive from local PES a grant to pay fully the cost of the training and to pay wages, including social and health insurance and travel expenses for a period of the training. 23

GET TRAINED! The total budget of the project was about 3 billion CZK, but only 1.5 billion CZK was paid out. During the project Labour offices approved and provided support, in total, for applications from companies. Training activities involved employees. 24

Significant results The Ministry of Labour and Social Affairs prepared and realised a set of projects/programmes aimed to reduce the impacts of the crisis in social and employment areas. The applied measures have enabled quick and flexible reactions to developments. 25

Significant results Active response to the current situation (short term measures) and the prevention of unemployment (long term measures). The combination of central action with regional intervention and the possibility to implement projects locally throughout the regions of the Czech Republic. 26

Significant results Fulfilled the aim to maintain the highest number of employees in work and to increase their employability if they change jobs. It helped to lower the financial burden on the employers which were able to invest more into the new technologies necessary for overcoming the crisis. 27

Significant results Improved reputation of PES amongst employers from a new focus on employers’ needs. It showed that it is possible to provide EU resources to finance training programmes quickly without extensive bureaucracy. 28

Significant results Workers have the opportunity to increase or adapt their skills to be ready to react flexibly to future labour market needs. 29

Significant results According to research by NAVREME BOHEME into 150 employers and 150 employees: 66% of employers think that thanks to GET TRAINED! they didn’t have to lay off employees. 30

Significant results 99% of employers think that the most valuable aspect of GET TRAINED! was the increase in the skills of their employees. 70% of employees believe that thanks to GET TRAINED! they weren’t laid off. 31

Significant results When questioned on their employability, 50% of employees believed that without doubt it had increased after GT! 42% believed that it was more helpful than not. 32

Recommendations 33 Construct the measures to be able to react immediately to market changes and to have the money available at the time of need. Adopted measures help employers to maintain maximum employees in jobs.

Recommendations 34 Pay attention to professional developments and further education of employees to increase their employability on the future labour market in general.

Thank you for your attention! Petr Richtera manager Labour Office of the Czech Republic Local Office in Rychnov nad Kněžnou Czech Republic Tel: Questions? Jarmila Mateřanková manager Labour Office of the Czech Republic Local Office in Opava Czech Republic Tel: