The Council of Ministers on September 29th approved the Royal Decree-Law on social measures in defense of employment, which extends the benefits of ERTE (Temporary Employment Regulation Files) and the benefits for cessation of activity compatible with activity and for seasonal self-employed workers until January 31, 2021, after having reached an agreement on the matter with the social partners.
We inform you that the Council of Ministers on September 29th approved the Royal Decree-Law on social measures in defense of employment, which extends the benefits of ERTE and the benefits for cessation of activity compatible with activity and for seasonal self-employed workers until January 31, 2021, after having reached an agreement in this regard with the social partners.
Outcome of the social dialogue in the Tripartite Labor Monitoring Commission
The Third Social Agreement in Defense of Employment has been reached between the Ministry of Labor and Social Economy and the Ministry of Inclusion, Social Security and Migration and the representatives of the trade union organizations CCOO and UGT and the representatives of the business organizations CEOE and CEPYME, which allows the extension of the benefits of the Temporary Employment Regulation Files (ERTE) until January 31, 2021.
The amount of benefits remains the same
The calculation basis for benefits will remain at 70% of the regulatory base of the worker who will not see their income reduced, as was the case until now, to 50% of the regulatory base once the first six months have elapsed.
This decreasing benefit system has been in force since the approval of Royal Decree-Law 3/2012 of February 10 on Urgent Measures for the Reform of the Labor Market, which will be modified for the first time to maintain the purchasing power of workers.
Temporary layoff (ERTE) due to impediment or limitation of activity
Companies in any sector or activity that are prevented from carrying out their activity as a result of the new restrictions or measures adopted from October 1, 2020 onwards, by both national and foreign authorities, may benefit from the ERTE scheme.
Companies whose operations are disrupted at any of their workplaces due to health measures may apply for a "Temporary Layoff Plan (ERTE) due to disruption," the duration of which will be limited to the duration of the disruption measures. These companies will receive an exemption from their Social Security contributions during the closure period and until January 31, 2021. This exemption will be 100% of the employer's contribution during the closure period and until January 31 if they have fewer than 50 employees, and 90% if they have 50 or more employees.
Companies or entities that see their activity limited in some of their workplaces as a result of decisions or measures adopted by Spanish authorities, may request a "ERTE due to limitations" from the labor authority.
In this case, the exemptions in Social Security contributions for suspended workers will decrease between the months of October 2020 and January 2021 based on the following percentages:
|
October 2020 |
November 2020 |
December 2020 |
January 2021 |
| Fewer than 50 employees |
100% |
90% |
85% |
80% |
| 50 or more workers |
90% |
80% |
75% |
70% |
Companies belonging to sectors with a high rate of coverage by temporary employment regulation files and a low rate of activity recovery
Companies with a high rate of coverage by temporary employment regulation files and a low rate of activity recovery will be considered those that carry out an activity that is classified in any of the codes of the National Classification of Economic Activities (CNAE-09) included in the agreement.
This section may also include companies whose economic activity depends mainly on companies whose CNAE codes are included in the standard or that form part of their value chain, that is, companies that can prove that in 2019 half of their turnover depended directly on those companies or if they depend indirectly on the companies included in the list of CNAE codes – 09.
The agreement establishes that companies in the two previous categories, which automatically extend the ERTE due to force majeure until the end of January 2021, will have exemptions in the Social Security contributions of their workers (both reactivated and suspended) accrued in the months of October, November and December 2020 and January 2021.
The exemptions will be 85% for companies with fewer than 50 workers and 75% for those with 50 or more workers, both for suspended workers and for those who return to their jobs.
This concept of company results from those that, from the beginning of the health crisis to date, have not managed to recover the regulated workers in significant percentages (less than 65 percent of workers recovered from the unemployment regulation files) and that also belong to specific sectors (more than 15 percent of regulated people of the total affiliated to the general regime in a specific CNAE).
These same conditions would also apply to companies that are part of the value chain of those particularly affected. These entities must submit an application to the relevant labor authority between October 5 and 19 to be declared as dependent companies or part of the value chain of another company.
Companies whose turnover during 2019 was generated, at least 50%, in operations carried out directly with "companies especially affected by the pandemic", as well as those companies whose real activity depends indirectly on them, will be considered part of the value chain.
These same exemptions in their Social Security contributions will be maintained (85% in the case of companies with fewer than 50 workers and 75% in companies with more than 50 workers) in the event that companies of the CNAE or of the value chain that start an ERTE for economic, technical, organizational or production reasons after the end of an ERTE of force majeure, once the Royal Decree Law that includes this agreement comes into force.
Counter reset to zero: Workers affected by a temporary layoff (ERTE)
Workers affected by a temporary layoff (ERTE) will have their "counter reset to zero" for those affected by an objective dismissal, individual or collective, or another dismissal based on any cause, that is declared unfair, during the year 2021, or if their temporary contract is terminated within this year.
For the first time, people affected by a temporary layoff (ERTE) will receive priority attention for training courses, and specific actions will be launched for this group.
Safeguarding employment
The Third Social Agreement in Defense of Employment maintains the safeguard commitments acquired in Royal Decree-Law 8/2020, of March 17, and in Article 6 of Royal Decree-Law 24/2020, of June 26.
In addition, a new 6-month job protection period is established for companies that take advantage of a new exempted ERTE (Temporary Employment Regulation File).
If a previous job retention commitment is in effect, the new safeguard period will begin when the previous ERTE period has ended
As in the previous agreement, companies covered by ERTE will not be able to carry out overtime, establish new outsourcing of activity, or arrange new contracts, whether direct or indirect, except for training, capacity or other objective and justified reasons.
The limits set in previous agreements on dividend distribution and the prohibition on establishing a presence in tax havens for companies wishing to take advantage of ERTE (Temporary Employment Regulation File) are also maintained.
Protection for seasonal workers
An extraordinary unemployment benefit will be granted to workers with fixed-term intermittent contracts or who perform fixed and periodic work that is repeated on certain dates, who have been affected by a temporary layoff (ERTE) during the theoretical period of activity.
This benefit may also be received by workers with fixed-term intermittent contracts not previously affected by ERTE who have exhausted the benefits or subsidies to which they were entitled, if they so request.
Improvements are being made to unemployment protection for people who work part-time.
Self-employed
Furthermore, the Royal Decree-Law includes the extension and expansion of the coverage of aid for the self-employed until January 31, 2021. Among the measures approved is the creation of a new extraordinary benefit for suspension of activity and the extension until January 31, 2021 of the benefit for cessation compatible with activity and for seasonal self-employed workers.
To cover those who do not meet the requirements for the benefit compatible with employment (for example, because they have a flat rate or have not contributed to social security in the last twelve months), a new low-income benefit is being created. The package of modifications to the Minimum Living Income has also been completed to facilitate the application process for this benefit.
Once the text is published in the BOE, we will inform you in more detail about these or any other changes that may be approved.
See: Consensus for a new framework for ERTEs and extraordinary benefits for the self-employed and regulatory modifications to the Minimum Living Income (PDF)
You can contact this professional office for any questions or clarifications you may have.
Warm regards,
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A Àmbit Assessor, SL has 40 years dedicated to the tax, comptable and labor consultancy of the Pime.
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