Spanish Congress votes to overturn gov't labor reform

The Spanish Congress voted to overturn labor reform introduced by the government of Prime Minister Mariano Rajoy, it was reported Wednesday.

The non-binding proposal for a law was passed by 168 votes in favor, 131 against and 42 abstentions.

Rajoy's People's Party (PP) was the only parliamentary group to oppose the proposal, which also asks for a new statute of workers rights.

The proposal for law asked Rajoy's government to "immediately adopt the necessary measures to overturn the labor reform... and to open a proposal of social dialogue based on agreement which culminated in the approval of a new statute of workers' rights."

The labor reform, introduced by the PP in February 2012, has been unpopular in Spain, lowering compensation paid by companies to workers who are sacked or made redundant.

Although it was intended to allow for more flexible conditions of employment in the depth of the economic crisis, many believe it has led to a disproportionate rise in the number of temporary contracts over permanent employment, while also forcing wages down.

The Congress vote came on the same day as the International Monetary Fund (IMF) revised its predictions for the Spanish economy.

The IMF expects the Spanish economy to grow by 2.3 percent in 2017, but warned further labor reform is necessary.

The reforms "continue to pay off," said the organization, but should "be expanded to sustain strong growth and employment prospects as there is still too much incentive for employers to hire on a temporary basis." Endit