June 22, 2021

Escrivá will toughen the punishment of companies that chain express contracts


MADRID

Updated:

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The Government will once again tighten the penalty in the quotation of short-term contracts in an attempt to fight against the duality of the Spanish labor market. The punishment will focus on companies that repeatedly opt for this type of hiring. As detailed by the Minister of Social Security, Jose Luis Escrivá, during the press conference to present the components of the Recovery, Transformation and Resilience Plan of its Ministry, the department is already working to eradicate the “abuse of short-term contracts, which are now excessively recurrent in the Spanish labor market » and a penalty “increasing with the number of drop-outs in a certain period of time” will be implemented. That is, the higher the number of casualties in the system, the higher the cost.

This is one of the novelties of the labor market to which the Government has committed to Brussels in exchange for accessing European funds and which include several novelties in the field of Social Security. In addition to the fight against temporary employment through contributions, Escrivá explained that two modalities of Permanent ERTEBecause “the pandemic has shown us that they have been a key tool to sustain employment and we want to use this experience for the future.” Specifically, one of the modalities will be aimed at companies that suffer temporary drops in their activity, as has happened with the Covid, while the other will be used for companies that must move towards new production models. In both models it will be imposed training for suspended workers, especially in the second mode.

ERTEs continue to be a protection umbrella for hundreds of thousands of people in Spain. Specifically, Escrivá hopes that the number of welcome down from 600,000 this week And, despite the warnings from organizations such as the Bank of Spain or Airef, which warn of the high risk that these people will eventually end up unemployed, the minister has been convinced of the reactivation of a good part of them. According to Escrivá, when you look at the structure, the people who are in ERTE are highly concentrated in sectors whose recovery is going to be “very strong in the coming months for sure.”

«Half of those 600,000 workers are employed in catering, food and drink and accommodation activities“Said Escrivá, although he clarified that” some parts of these sectors could happen that there are changes in the structure of demand and the need for some type of adjustment becomes evident and there we will be able to have an opportunity to apply the mechanism of internal flexibility for companies ”. Funding for these permanent flexibility mechanisms is still in the design process. «The creation of a Tripartite Fund is envisaged to finance the mechanism, whose public contributions could come from Recovery Fund-Next Generation loans“Escrivá said.

With regard to the pension system, the minister has predicted an early outcome to the negotiations with the social agents. “You have to meet the plan deadlines,” Escrivá said. “The agreement has to be imminent.” The agreement must include the new self-employed contribution system, although the minister has remarked that the system change will be “very gradual” and that the entry into force will not begin until 2023. The first reform package, which does not include the socially thorniest points, such as the one that will be the new sustainability factor, includes a redesign of the coefficients of de-incentivization for early retirement and the repeal of the forced retirement clause.

The minister has insisted on the need to eliminate the uncertainty that exists about the pension system and about future pensioners. One of the keys in this regard will be the design of the tools necessary to absorb the arrivals of the generation of ‘baby boom’ at retirement age. As Escrivá explained, the philosophy of the new sustainability factor, the call for intergenerational equity, in which the ministry works, seeks to concentrate the weight of the effort that the system will have to make on the generation of ‘baby boomers’ and to a lesser extent on the following generations.

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