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Greece

Executive Summary

The Greek economy has proven resilient in recent years as it continues to rebound from the 2007 economic crisis – including the rigid fiscal constraints demanded by creditors — and the global COVID-19 pandemic.  In early 2020, COVID-19 held the potential to permanently scar an economy that still suffered from legacy issues, including high debt and non-performing loans, limited credit growth, near zero capacity for fiscal expansion, and a hollowed-out healthcare system.  While continuing its aggressive reform agenda, the Mitsotakis government rose to meet the pandemic challenge, as European institutions effectively welcomed Greek debt back into the eurosystem, the IMF and EU evaluated the country’s public debt as sustainable, Moody’s upgraded Greek sovereign debt, the country began borrowing at historically low cost, and strategic investors returned, favorably considering Greece’s current and long-term value proposition.  Meanwhile, over the past several years, our bilateral relationship has deepened significantly via our defense and strategic partnerships, and Greece ambitiously seeks now to bring our economic ties to similar, historic heights.  Far from being the problem child of Europe or the international financial system, Greece is increasingly a source of solutions – not just in the fields of energy diplomacy and defense, but in high-tech innovation, healthcare, and green energy, improving prospects for solid economic growth and stability here and in the wider region.

The Mitsotakis government was elected in July 2019 on an aggressive investment and economic reform agenda which has plowed forward despite the pandemic.  During its first nine months in power, Mitostakis’s team pushed market-friendly reforms and Parliament voted through dozens of economic-related bills, including a key investment law in October 2019, designed to cut red tape, help achieve full employment, and adopt best international practices – including by digitizing government services.  GDP growth reached 8.3 percent in 2021, a major leap forward following the detrimental effects of the COVID-19 pandemic.

Greece maintains a liquidity buffer, estimated at €30 billion, but is intent on boosting its coffers as the economic fallout from the COVID-19 pandemic is larger than expected.  So far untouched, the buffer should be sufficient to cover the country’s financing needs until at least the end of 2022, and the country’s leadership maintains its intention to reserve the European Stability Mechanism (ESM) tranche solely for sovereign debt interest payments.  While capital controls were completely lifted in September 2019, Greece remains subject to enhanced supervision by Eurozone creditors.  However, the European Commission’s (EC) latest positive assessment on the Greek economy, will – most likely – pave the way for the end of the country’s enhanced surveillance status in Q3 2022.

Greece’s banking system, despite three recapitalizations as part of the August 2015 European Stability Mechanism (ESM) agreement, remains saddled with the largest ratio of non-performing loans in the EU, which constrains the domestic financial sector’s ability to finance the national economy.  As a result, businesses, particularly small and medium enterprises, still struggle to obtain domestic financing to support operations due to inflated risk premiums in the sector.  To tackle the issue, and as a requirement of the agreement with the ESM, Greece has established a secondary market for its non-performing loans (NPLs).  According to the Bank of Greece, non-performing loans (NPLs) came, on a solo basis, to €58.7 billion at end-September 2020, down by €9.8 billion from December 2019 and by €48.5 billion from their March 2016 peak.  The NPL-to-total loan ratio remained high in September 2020 at 35.8 percent. The high percentage of performing loans benefited from moratoria until December 31, 2020, and contained the inflow of new NPLs. Non-performing private debt remains high, irrespective of the reduction in NPLs on bank balance sheets via transfer to non-bank entities. 2020 saw substantial reforms aimed at resolving the issue of NPLs.  These involved the securitization of NPLs through the activation of the “Hercules” scheme and the enactment of Law No. 4738/2020 which improves several aspects of insolvency law.  Nevertheless, NPLs will remain high, and considering that there will be a new inflow of NPLs due to the pandemic, other solutions complementary to the “Hercules” scheme should be implemented.  In addition to sales of securitized loan packages, banks have exploited other ways to manage bad loans.  For example, nearly all of Greece’s systemic banks employ loan servicing firms to manage non-performing exposure.  Greece’s secondary market for NPL servicers now includes 24 companies including: Sepal (an Alpha Bank-Aktua joint venture), FPS (a Eurobank subsidiary), Pillarstone, Independent Portfolio Management, B2Kapital, UCI Hellas, Resolute Asset Management, Thea Artemis, PQH, Qquant Master Servicer, and DV01 Asset Management.

Greece’s return to economic growth has generated new investor interest in the country.  Pfizer, Cisco, Deloitte, and Microsoft, to name a few, have all announced major investments in the past few years, due in part to improved protection of intellectual property rights and Greece’s delisting from the U.S. Trade Representatives Special 301 Watch List in 2020.  In March 2021, Greece successfully raised €2.5 billion from its first 30-year bond sale in more than a decade, with the issue more than 10 times oversubscribed.  The bond, which has so far received investor demand of more than €26.1 billion, will price at 150 basis points over the mid-swap level, resulting in a yield of 1.93 percent.

In January 2022, Fitch Ratings Agency maintained Greece’s credit rating at BB and noted the country’s outlook as ‘stable’ due to the financial impact of COVID-19.  On April 1, 2021, Moody’s improved its outlook of the Greek banking system from “stable” to “positive.”Standard & Poor’s affirmed its credit rating for Greece at BB-in October 2020 and also kept its outlook to “stable.”  The European Central Bank (ECB) included Greek government bonds in its quantitative easing program, with €12 billion worth of Greek government debt earmarked for purchase under the ECB’s €750 billion Pandemic Emergency Purchase Program in 2020.  In February 2022, Greece has received the Eurogroup’s approval to repay the final tranches of bailout loans from the International Monetary Fund (IMF) early, along with a small part of bilateral loans from its eurozone partners.  Greece plans to repay loans worth €1.9 billion to the IMF by March, two years ahead of schedule.

The Greek government was given strong marks for its initial response in limiting the spread of the pandemic and has implemented several innovative digital reforms to its economy during COVID-19.  The Greek economy contracted by 10 percent in 2020 with a gross domestic product (GDP) of €189 billion but its GDP rose to €211 billion in 2021.  This was largely attributed to the successful 2021tourism season, which brought in €10 billion to the Greek economy.  The unemployment rate was 15.8 percent in 2021, a slight increase from 15.5 percent in 2020.

In response to the pandemic, Greece’s recovery and resilience plan was among the first plans that were formally approved by the European Council, in July 2021.  Greece received €4 billion of the disbursement in August.  The plan will disburse €17.8 billion in grants and €12.7 billion in loans over the course of five years.  Greece has earmarked funding for many climate-relevant investments and digitalization efforts.  Greece was also the first Member State to finalize its Partnership Agreement for the 2021-2027 programming period.  The Partnership Agreement outlines the plan for deploying of more than €21 billion worth of investments to support Greece’s economic, social and territorial cohesion.

The Greek government also took measures to support businesses throughout the pandemic in 2021.  In February 2021, the government approved a €500 million scheme to support small and medium-sized businesses affected by the pandemic.  The state aid Temporary Framework was open to small and medium-sized enterprises active in all sectors except financial, primary agriculture, tobacco, and fisheries sectors.  This public support, in the form of direct grants, sought to provide sufficient working capital for businesses affected by the pandemic.  In May 2021, the European Commission approved a €793 million support measure for micro, small and medium-sized enterprises affected by the coronavirus outbreak in the form of direct grants, which is open to companies active in all sectors except the financial one.  The aid aims to provide liquidity support to qualifying beneficiaries, to safeguard businesses against the risk of default, allowing them to preserve their economic activity and helping them recover after the pandemic.

Rounding out 2021, the Greek government enacted a €665 million scheme in November 2021 to support households affected by the pandemic.  The scheme was adopted to assist households at risk of losing their primary residence by defaulting on their mortgage loans.  On 3 November 2021, the European Commission approved modifications to ensure the extension of the loan period and a reduction of the maximum aid amount per beneficiary.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2021 58 of 180 https://www.transparency.org/country/GRC
Global Innovation Index 2021 47 of 131 https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2020 $74 million https://apps.bea.gov/international/factsheet/factsheet.cfm?Area=310
World Bank GNI per capita 2020 $17,930 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

3. Legal Regime

4. Industrial Policies

5. Protection of Property Rights

6. Financial Sector

7. State-Owned Enterprises

Greek state-owned enterprises (SOEs) are active in utilities, transportation, energy, media, health, and the defense industry.  There is no official website with a list of SOEs.

Bank of Greece: partially owned (Greek state shares cannot exceed 35 percent); over 1,800 employees; governed by a Governor appointed by the government.

Public Gas Corporation of Greece (DEPA): majority-owned by Greek state (65 percent); Net income €131 million in 2016; Total assets €3.1 billion in 2016; governed by Ministry of Development; Government is in the process of splitting the company and privatizing its infrastructure and commercial operations.

Hellenic Aerospace Industry: wholly owned; Total assets €932.5 million in 2014; Net income €13.7 million in 2014; over 1,300 employees.

Hellenic Financial Stability Fund: governed by General Council and Executive Board

Hellenic Post: majority-owned (90 percent by Greek state); Net income €15.5 million in 2017.

Hellenic Vehicle Organization: majority-owned (51 percent owned by Greek state); around 400 employees; Total assets around €69 million; governed by Board of Directors.

Water Supply and Sewerage Company (EYDAP): majority-owned (34 percent by Greek state); governed by Board of Directors.

Public Power Corporation: majority-owned (51 percent by Greek state); Total assets €14.1 billion in 2018; over 16,700 employees.

Most Greek SOEs are structured under the auspices of the Hellenic Corporation for Assets and Participations (HCAP), an independent holding company for state assets mandated by Greece’s 2015 bailout and formally launched in 2016.  HCAP’s supervisory board is independent from the Greek state and is appointed in part by Greece’s creditor institutions.  Some SOEs are still supervised by the Finance Ministry’s Special Secretariat for Public Enterprises and Organizations, established by Law 3429/2005.  Private companies previously were not allowed to enter the market in sectors where the SOE functioned as a monopoly, such as water, sewage, or urban transportation.  However, several of these SOEs are planned for privatization as a requirement of the country’s bailout programs, intended to liberalize markets and raise revenues for the state.

Official government statements on privatization since 2015 have sometimes led to confusion among investors.  Some senior officials have declared their opposition to previously approved privatization projects, while other officials have maintained the stance that the government remains committed to the sale of SOEs.  The current government has expressed its commitment and is moving forward with privatizations, including DEPA and some of the port assets.  Under the bailout agreement, Greece has moved forward with the deregulation of the electricity market, adopting the Target Model in November 2020.  In sectors opened to private investment, such as the telecommunications market, private enterprises compete with public enterprises under the same nominal terms and conditions with respect to access to markets, credit, and other business operations, such as licenses and supplies.  Some private sector competitors to SOEs report the government has provided preferential treatment to SOEs in obtaining licenses and leases.  The government actively seeks to end many of these state monopolies and introduce private competition as part of its overall reform of the Greek economy.  Greece – as a member of the EU – participates in the Government Procurement Agreement within the framework of the WTO.  SOEs purchase goods and services from private sector and foreign firms through public tenders.  SOEs are subject to budget constraints, with salary cuts imposed in the past few years on public sector jobs.

8. Responsible Business Conduct

Awareness of corporate social responsibility (CSR) including environmental, social, and governance issues, has been growing over the last decade among both producers and consumers in Greece.  Several enterprises, particularly large ones, in many fields of production and services, have accepted and now promote CSR principles.  Several non-profit business associations have emerged in the last few years (Hellenic Network for Corporate Social Responsibility, Global Sustain, etc.) to disseminate CSR values and to promote them in the business world and society more broadly.  These groups’ members have incorporated programs that contribute to the sustainable economic development of the communities in which they operate; minimize the impacts of their activities on the environment and natural resources; create healthy and safe working conditions for their employees; provide equal opportunities for employment and professional development; and provide shareholders with satisfactory returns through responsible social and environmental management.  Firms that pursue CSR in Greece enhance the public acceptance and respect that they enjoy.  In 2014, the government drafted a National Action Plan for Corporate Social Responsibility for the 2014-2021 period.  The main goal of the plan is to increase the number of companies that recognize and use CSR to formulate their strategies.  Greece has encouraged adherence to the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Afflicted and High-Risk Areas.  There are no alleged/reported human or labor rights concerns relating to CSR that foreign businesses should be aware of.  Greece is not a member of the Extractive Industries Transparency Initiative.  Greece signed the Montreux Document on Private Military and Security Companies in 2009.  It has also been a supporter of the International Code of Conduct for Private Security Service Providers and is a participant in the International Code of Conduct for Private Security Service Providers’ Association (ICoCA).

9. Corruption

Greece saw a slight increase in perceptions of corruption, as it went up one place to 59 on Transparency International’s 2019 Corruption Perception Index, from 60 in 2019 and 67 in 2018.  By contrast, the country had improved since 2012, partly due to mandatory structural reforms.  Despite these structural improvements, bureaucracy is reportedly slowing the progress.  Transparency International issued a report in 2018 criticizing the government for improper public procurement actions involving Greek government ministers and the recent appointment of the close advisor to the country’s prime minister to be the head of the Hellenic Competition Commission, which oversees the enforcement of anti-trust legislation.  Transparency International released another report in October 2018, warning of the corruption risks posed by golden visa programs, mentioning Greece as a top issuer of golden visas.  In Transparency International’s 2020 report, the organization outlined the costs directly stemming from the COVID-19 pandemic, including cases of foreign bribery occurring in the health care sector.

On March 19, 2015, the government passed Law 4320, which provides for the establishment of a General Secretariat for Combatting Corruption under the authority of a new Minister of State.  Under Article 12 of the Law, this entity drafts a national anti-corruption strategy, with an emphasis on coordination between anti-corruption bodies within various ministries and agencies, including the Economic Police, the Financial and Economic Crime Unit (SDOE), the Ministries’ Internal Control Units, and the Health and Welfare Services Inspection Body.  Based on Law 4320, two major anti-corruption bodies, the Inspectors-Controllers Body for Public Administration (SEEDD) and the Inspectors-Controllers Body for Public Works (SEDE), were moved under the jurisdiction of the General Secretariat for Combatting Corruption.  A Minister of State for combatting corruption was appointed to the cabinet following the January 2015 elections and given oversight of government efforts to combat corruption and economic crimes.  The minister drafted coordinated plans of action, monitored their implementation, and was given operational control of the Economic Crime division of the Hellenic Police, the SDOE, ministries’ internal control units, and the Health and Welfare Services’ inspection body.  Following the September 2015 national elections, the government abolished the cabinet post of Minister of State for combatting corruption and assigned those duties to a new alternate minister for combatting corruption in the Ministry of Justice, Transparency, and Human Rights.

Legislation passed on May 11, 2015, provides a wider range of disciplinary sanctions against state employees accused of misconduct or breach of duty, while eliminating the immediate suspension of an accused employee prior to the completion of legal proceedings.  If found guilty, offenders could be deprived of wages for up to 12 months and forced to relinquish their right to regain a senior post for a period of one to five years.  Certain offenders could also be fined from €3,000 to €100,000.  The law requires income and asset disclosure by appointed and elected officials, including nonpublic sector employees, such as journalists and heads of state-funded NGOs.  Several different agencies are mandated to monitor and verify disclosures, including the General Inspectorate for Public Administration, the police internal affairs bureau, the Piraeus appeals prosecutor, and an independent permanent parliamentary committee.  Declarations are made publicly available.  The law provides for administrative and criminal sanctions for noncompliance. Penalties range from two to ten years’ imprisonment and fines from €10,000 to €1 million.  On August 7, 2019, Parliament passed legislation establishing a unified transparency authority by transferring the powers and responsibilities of public administration inspection services to an independent authority.  In November 2019, laws addressing the bribery of officials were amended to include a specific definition of “public official” and to make active bribery of a public official a felony instead of a misdemeanor, punishable by a prison sentence of five to eight years (as opposed to three years).  On November 17, 2020, the government established the Financial Prosecutor’s Office to deal with financial crime in the wake of public complaints about an investigation by the Corruption Prosecutor’s Office into a case involving the pharmaceutical company Novartis.  The new office, headed by a senior prosecutor selected by the Supreme Judicial Council of the Supreme Court, included 16 prosecutors, and became operational in November 2020.

Bribery is a criminal act, and the law provides severe penalties for infractions, although diligent implementation and haphazard or uneven enforcement of the law remains an issue.  Historically, the problem has been most acute in government procurement, as political influence and other considerations are widely believed to play a significant role in the evaluation of bids.  Corruption related to the health care system and political party funding are areas of concern, as is the “fragmented” anti-corruption apparatus.  NGOs and other observers have expressed concern over perceived high levels of official corruption.  Permanent and ad hoc government entities charged with combating corruption are understaffed and underfinanced. There is a widespread perception that there are high levels of corruption in the public sector and tax evasion in the private sector, and many Greeks view corruption as the main obstacle to economic recovery.

The Ministry of Justice prosecutes cases of bribery and corruption.  In cases where politicians are involved, the Greek parliament can conduct investigations and/or lift parliamentary immunity to allow a special court action to proceed against the politician.  A December 2014 law does not allow high ranking officials, including the prime minister, ministers, alternate, and deputy ministers, parliament deputies, European Parliament deputies, general and special secretaries, regional governors and vice governors, and mayors and deputy mayors to benefit from more lenient sentences in cases involving official bribes.  In 2019, Parliament passed an amendment to Article 62 of the constitution, which limits parliamentary immunity to acts carried out in the course of parliamentary duties.  In addition, Parliament amended Article 86 of the constitution, abolishing the statute of limitations for crimes committed by ministers and to disallow postponements for trials of ministers.

Greece is a signatory to the UN Anticorruption Convention, which it signed on December 10, 2003, and ratified September 17, 2008.  As a signatory of the OECD Convention on Combating Bribery of Foreign Government Officials and all relevant EU-mandated anti-corruption agreements, the Greek government is committed in principle to penalizing those who commit bribery in Greece or abroad.  The OECD Convention has been in effect since 1999.  Greek accession to other relevant conventions or treaties:

Council of Europe Civil Law Convention on Corruption: Signed June 8, 2000.  Ratified February 21, 2002.  Entry into force: November 1, 2003.

Council of Europe Criminal Law Convention on Corruption: Signed January 27, 1999.  Ratified July 10, 2007.  Entry into force: November 1, 2007.

United Nations Convention against Transnational Organized Crime: Signed on December 13, 2000.  Ratified January 11, 2011.

10. Political and Security Environment

There have been no major terrorist incidents in Greece in recent years; however, domestic groups conduct intermittent small-scale attacks such as targeted package bombs, improvised explosive devices, and unsophisticated incendiary devices (Molotov cocktails) typically targeting properties of political figures, party offices, privately owned vehicles, ministries, police stations, and businesses. In addition, domestic anarchist groups often carry out small-scale attacks targeting government buildings and foreign missions.  Bilateral counterterrorism cooperation with the Greek government remains strong, and support from the Greek security services with respect to the protection of American interests is excellent.  Demonstrations and protests are commonplace in large cities in Greece. While most of these demonstrations and strikes are peaceful and small-scale, they often cause temporary disruption to essential services and traffic, and anarchist groups are known in some cases to attach themselves to other demonstrations to create mayhem.

The masterminds of Greece’s most notorious terrorist groups are currently behind bars, including leaders of November 17 and Revolutionary Popular Struggle, active between the 1970s and 1990s and responsible for hundreds of attacks and murders.  Greek authorities largely eliminated these groups in advance of the 2004 Olympic Games.  Following the Olympics, a new wave of organizations emerged, including Revolutionary Struggle, Conspiracy of Fire Nuclei, and Sect of Revolutionaries, though authorities rounded up these groups in a wave of arrests between 2009 and 2011, and again in 2014.

Domestic terrorist groups include “OLA,” also known as the Group of Popular Fighters or Popular Fighters Group, which claimed responsibility for the December 2018 bomb outside a private television station and the December 2017 bomb outside an Athens courthouse.  OLA also claimed responsibility for the November 2015 bomb attack at the offices of the Hellenic Federation of Enterprises, which caused extensive damage to the offices and surrounding buildings, the December 2014 attack on the Israeli embassy in Athens, which resulted in no injuries and minor damage to the building, and the attack on the German Ambassador’s residence in Athens in December 2013.  OLA also claimed responsibility for an indirect fire attack on a Mercedes-Benz building on January 12, 2014, and an attack in January 2013 against the headquarters of the then-governing New Democracy party in Athens.

11. Labor Policies and Practices

There is an adequate supply of skilled, semi-skilled, and unskilled labor in Greece, although some highly technical skills may be lacking.  Illegal immigrants predominate in the unskilled labor sector in many urban areas, and in rural areas predominately in agriculture.  Greece provides residency permits to migrants for a variety of reasons, including work.  In July 2015, Parliament adopted a law regulating the status of non-EU foreign nationals recruited to work in the country as seasonal workers.  The law also reduces the minimum consecutive residency period in the country required for undocumented migrants to be eligible to apply for a residency permit from ten to seven years, such applications being judged on the applicant’s strong ties to the country.  The same law outlines the requirements for setting work contracts, requires proof of adequate shelter for workers and imposes a €1,500 ($1,620) fine for employers who do not do so, requires prepayment of at least one month’s worth of social security for each employee, provides basic labor rights to each worker, and prohibits employers from recruiting workers if found to have previously recruited workers through fraudulent means.  The law also stipulates that daily wages for non-EU foreign seasonal workers cannot be less than that of an unqualified worker.  The law grants seasonal non-EU foreign workers the same rights as citizens with respect to minimum age of employment, labor conditions, the right to association, unionism, collective bargaining, education and vocational training, employment consultation services, and the right to certain goods, services and benefits under conditions.  The same law also provides that non-EU nationals who are victims of abusive conditions or labor accidents could be eligible to apply for a residency permit on humanitarian grounds.

The labor force today is overwhelmingly comprised of employees who have secondary or higher-level education. Relatedly, beginning in 2012, women in the labor force now possess more higher education degrees than men.

In December 2021, the unemployment rate in Greece was 12.8 percent, a decrease from the 15.5 percent unemployment rate in December 2020 and from the 13.4 percent rate in November 2021.  In 2021, the unemployment rate among men was 10 percent, while among women it was 16.2 percent.  The unemployment rate among Greek citizens age 15-24 years remains high at 27 percent.  The unemployment rate for those citizens age 25 – 74 is currently 12.1 percent.

According to a report conducted by the International Monetary Fund in 2019, Greece’s informal economy is among the highest in the EU.  An informal economy, or shadow economy, is the part of any economy that is neither taxed nor monitored by any form of government.  The informal economy in Greece followed an upward trend until 2009, when it accounted for €56.9 billion at the current inflation rate.

An OECD report published in 2021 highlights a significant increase in the shadow economy during the COVID-19 pandemic and in all of OECD’s 36 member states.  In 2020, rising unemployment and a slump in GDP drove more citizens into the shadow economy to make up for lost income.

In Greece, OECD estimates the shadow economy rose to 20.9 percent of GDP from 19.2 percent in 2019.From preliminary estimates, the shadow economy fell in 2021 to 20.3 percent.  However, the shadow economy in Greece in 2021 increased by €1.6 billion from 2020.

Asylum-seekers are eligible to apply for a work permit once they complete their first asylum interview; however, the procedures for obtaining this permit were not widely understood by asylum-seekers, non-governmental organizations (NGOs), or government officials.  As of February 2021, the Greek Asylum Service had 74,934 cases pending, with the backlog expected to be cleared before the end of 2021.  Asylum services and receipt of applications were suspended from March 13-April 10, 2020, due to the COVID-19 pandemic.  Recognized refugees are entitled to the same labor rights as Greek nationals.  NGOs and government officials working in migrant sites reported that some asylum-seekers perform undeclared seasonal agricultural labor in rural areas.

In April 2019, Greece announced a wage subsidy scheme called “Rebrain Greece,” which provides 500 talented Greeks that moved abroad during the financial crisis with a €3,000 monthly salary if they return to Greece.  The program hopes to reinvigorate high-skilled sectors of the economy.  In December 2020, the Greek Parliament passed Law 4758 that involved a tax break for those foreign nationals who would transfer their tax residence to Greece.  Digital nomads who choose to work in Greece can take advantage of a 50 percent tax break for their first seven years of residency.

Greece has ratified International Labor Organization (ILO) Core Conventions.  Specific legislation provides for the right of association and the rights to strike, organize, and bargain collectively.  Greek labor laws set a minimum age (15) and wage for employment, determine acceptable work conditions and minimum occupational health and safety standards, define working hours, limit overtime, and apply certain rules for the dismissal of personnel.  There is a difference between national minimum wage in the private sector for unspecialized workers aged 25 or older and workers below 25 years of age.  The latter receive 84 percent of the salary of those over 25.  A May 2015 law amended the laws prohibiting strikes during national emergencies.  The 2015 law explicitly prohibits the issuance of civil mobilization orders as a means of countering strike actions before or after their proclamation.

In 2017 parliament passed legislation providing for the temporary closure of businesses in cases where employers repeatedly violate the law concerning undeclared work or safety.  Under the same law, employers are obliged to declare in advance their employees’ overtime or changes in their work schedules.  The legislation also provided for social and welfare benefits to be granted to surrogate mothers, including protection from dismissal during pregnancy and after childbirth.  Courts are required to examine complaints filed by employees against their employers for delayed payment within two months after their filing, and issue decisions within 30 days after the hearing.

The government sets restrictions on mass dismissals in private and public companies employing more than 20 workers.  Dismissals exceeding in number the limits set by law require consultations through the Supreme Labor Council (with worker, employer, and government representatives participating), and government authorization.  Based on a ministerial decision in February 2014, the government shifted competency for approving dismissals from the Minister of Labor to the Ministry’s Secretary General.

Greek law provides for the right of workers to form and join independent unions, conduct their activities without interference, and strike.  The establishment of trade unions in enterprises with fewer than 20 workers is prohibited.  In July 2016, Parliament passed a law allowing armed forces personnel to form unions, while explicitly prohibiting strikes and work stoppages by those unions.  Police also have the right to organize and demonstrate but not to strike.  On July 10, 2020, the parliament separately passed legislation requiring prior and timely announcements – in writing or via email – of demonstrations to the appropriate police or Coast Guard authorities.  The laws also make protest organizers accountable for bodily harm or property damage if they do not follow the requirements.

Around 950 inspectors are authorized to conduct labor inspections, including labor inspectorate personnel and staff of the Ministry of Labor, Social Security, and Social Solidarity, the Social Insurance Fund, the Economic Crimes Division of the police, and the Independent Authority for Public Revenue.  Despite government efforts to increase inspections for undeclared, under-declared, and unpaid work, trade unions and the media alleged that, due to insufficient inspectorate staffing, enforcement of labor standards was inadequate in the housekeeping services, tourism, and agricultural sectors.  Enforcement was also lacking among small enterprises (employing 10 or fewer persons).  According to the Union of Labor Health Inspectors, authorities conducted approximately 45,000 inspections related to issues of health and safety at work and ordered fines amounting to 7 million euros ($8.4 million) between 2015 and 2016.

Wage laws are not always enforced.  Unions and media allege that some private businesses forced their employees to return part of their wages and mandatory seasonal bonuses, in cash, after being deposited in the bank.  Several employees were reportedly registered as part-time workers but in essence worked additional hours without being paid.  In other cases, employees were paid after months of delays and oftentimes with coupons and not in cash.  Cases of employment for up to 30 consecutive days of work without weekends off were also reported.  Such violations were mostly noted in the tourism, agriculture, and housekeeping services sectors.

On July 1, 2019, Greece introduced Law 4611/2019, requiring Greek employers to provide a lawful reason when terminating employees on indefinite-term contracts, to pay social security contributions on behalf of interns and apprentices, and introduced new health and safety requirements including use of motorcycles for employment purposes.

14. Contact for More Information

Carl Watson, Deputy Economic Counselor
U.S. Embassy Athens, Leof. Vasilissis Sofias 91, Athina 115 21, Greece
+30 210-720-2306
ATHENS-econ@state.gov

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