Employers will be able to offer young people monthly salaries of less than 600 euros as part of labor market reforms that the government has agreed with the European Union and the International Monetary Fund, according to sources.

The government is expected to announce several changes to labor laws in the mid-term fiscal plan, which is currently being finalized.

One of these is to allow employers to pay anyone under the age of 25 20 percent below the monthly minimum wage (739.60 euros gross), as set by the national collective contract. This means that those affected will be paid a gross monthly salary of 591.60 euros.

A similar law was passed last year but the Manpower Organization (OAED) covered the difference between the minimum and lower wages. This will no longer be the case.

Among other changes that have been reportedly agreed, fixed-term contracts will now be for up to three years, rather than two. Employers will be able to renew these deals up to three times, thereby keeping employees on fixed-term agreements for up to nine years without having to hire them permanently. If at the end of the nine years, the employee is not kept on, he or she will not receive any redundancy pay.

The government and the troika have also agreed that businesses will be able to ask employees to be flexible in their working hours. An employer will have the right to ask for employees to work for 10 rather than eight hours for up to six months a year, rather than the current four, in return for working six hours for an equal time.

The reforms will apply to the broader public sector as well as the private sector, where many of these measures already apply unofficially.