The extent of undeclared work amounts to a rate of 8% of the workforce, which numerically corresponds to approximately 40,000 employees, resulting in income losses for the Social Insurance Fund estimated at €10,000,000 annually, stated the Minister of Labour today.
However, according to Yiannis Panagiotou, through targeted inspections conducted recently by the Ministry of Labour in cooperation with the Ministry of Interior and the Police, an escalation of these violations is observed in specific sectors of economic activity.
Specifically, in 2889 inspections carried out in the past months at construction sites and businesses, 7937 employees were examined, and violations of undeclared and illegal work were detected in 1038 cases, corresponding to a rate of 13%.
“The increasing trend of undeclared work is worrying, and the Government is taking additional measures to effectively limit and reduce it.
Specifically, the Council of Ministers decided on the following measures, which will be immediately implemented:
Increase in inspections conducted and targeting specific areas and hours. Expansion of coordinated operations of the Inspection Service of the Ministry of Labour and the Service for Foreigners and Immigration of the Police. Interconnection of available information systems and existing databases for the utilization of data and information. Conducting a campaign to approach third-country nationals aged 17 to 65 who are legally residing in Cyprus but are not identified as legal employees. Investigation into the connection between employers applying the practice of undeclared and illegal employment of foreigners with the traffickers of illegal immigrants. Conducting an awareness campaign regarding the consequences and impacts of undeclared and illegal work in collaboration with social partners and other relevant authorities,” he said.
“In addition, the Council of Ministers decided on the following measures, for which relevant bills will be submitted to make the necessary legislative changes, following the necessary consultation with social partners:
Electronic registration of all employees in the information system of the Ministry of Labour and Social Insurance. Imposition of an extrajudicial fine of €1000 for each case of undeclared work. Inclusion of liability on the main contractor in addition to the subcontractor, for cases of undeclared work. Doubling the extrajudicial fine in case of repeated violation with a new case of undeclared work.
We call on all employers to promptly comply with the provisions of the legislation and cooperate with the Ministry of Labour, utilizing the potential of the domestic workforce and legally employed workers in the country by registering the details of all employed individuals in the ERGANI electronic system and paying to the Social Insurance Fund the total amount of the corresponding insurance contributions,” he added.
The issue will be included in the agenda of the next session of the Labour Advisory Body, and I am confident that with the support and cooperation of social partners, the results of this effort will be substantial and mutually beneficial for all, Panagiotou concluded.
