ERTE UPDATE: All parties met again today, government offers more social payments exemption

2020/06/22 23:44:01 Written by Canarian Weekly Business

The negotiation of the ERTE continues 'in extremis' with a new proposal from the Government, with more generous social security exemptions.

The Government met again this afternoon with employers representatives and trade unions to negotiate the expansion of the ERTE beyond June 30th.
Today they presented a new proposal for an extension until September 30th, with more generous exemptions of contributions to Social Security, in respect to their initial offer, but they still haven't reached an agreement with the social agents, since the employers representatives are still showing some reluctance.

No one doubts that the ERTE will be extended beyond the end of June, but there is still debate and room for change in some of the details, the small print that the parties will continue to discuss this week.

The deadline for reaching a consensual solution is running out: ERTEs due to force majeure stemming from the COVID-19 crisis, end on June 30th. The Government and the social partners will continue to negotiate 'in extremis', with their next meeting on Wednesday, to define the continuity of the ERTE, and its conditions.

Some issues are certain, such as maintaining the benefits of unemployment protection, offered by the Government to people affected by ERTE, and also that the date for an extension, is for the moment, until September 30th.

New exemption proposal:
The Executive went to the negotiating table today (Monday), with another proposal in which it has expanded the exemptions in the Social Security quotas that companies will be expected to pay, with respect to what was proposed last Monday.
The exemptions for the new normality are still smaller than those that have existed until now, when the state of alarm has limited many activities, but "they are substantially improved" with respect to the initial offer, says Mari Cruz Vicente, secretary of the CCOO.

As for the percentages, the latest offer from the Government suggests that companies with less than 50 workers can save 65% of the contributions of employees who return to the activity, and 40% of those who remain in the ERTE.

For companies that exceed this level of employees, the proposed exemptions are 45% for quotas for employees who resume the activity, and 30% for those who continue in the file.

Although the Government has improved its offer, some issues remain that neither employers nor unions like, such as the Executive still "rewards" with higher exemptions, the quotas of workers who rejoin the activity rather than those who remain in the ERTE.

Social Security insist that this exemption model, is the best formula to promote the reactivation of employment, while the social agents defend that it penalizes companies, that are having the worst time and cannot yet incorporate their workers.

The new conditions on the ERTE must be reflected in a royal decree-law before the end of the month. The government will no longer present it tomorrow (Tuesday) in the Council of Ministers, so the new norm must be approved in an extraordinary council., which will happen whether all parties agree, or if the Government approves it alone.