May 26, 2020

The fine print of the decree with labor measures, moratorium on mortgages and prohibition of power and gas cuts



The Government approved this Tuesday your second budget package to face the coronavirus epidemic, in which he developed mainly labor and economic support measures for companies and workers, as well as social measures for the most vulnerable groups in this health emergency. With the publication of the royal decree law in the BOE this Wednesday, we highlight the fine print of some of the most outstanding measures.

In general, unless otherwise indicated in an article, the planned measures will remain in force for “the period of one month from their entry into force”, this Wednesday, “notwithstanding that, after evaluating the situation, may extend its duration by the Government.

Mortgages: possible moratorium from Thursday 19

It is established a moratorium on the payment of mortgage payments for mortgage debtors under certain cases of special vulnerability that see their income decrease due to the COVID-19 crisis, and can request it from this Thursday until May 3, while the creditors will have up to 15 days from delivery request for implementation.

During the period of validity of the moratorium, the creditor entity may not demand the payment of the mortgage installment, nor of any of the concepts that comprise it (amortization of the capital or payment of interest), either in full or in a percentage. Neither will interest be earned.

Forbidden to cut off water, electricity or gas

Electricity, natural gas and water companies will not be able to cut off the supply to vulnerable consumers during the month following the entry into force of the decree, that is, until April 18. Who are vulnerable consumers? Those whose annual income is equal to or less than 11,279 euros (1.5 times the IPREM) if there are no minors in the family unit; 15,039 euros if there is a minor and 18,800 if there are two minors. Also included are large families and households in which all members receive the minimum pension. The income multiplier increases by 0.5 if any of the members has a disability, is a victim of gender violence or terrorism. Full definition of vulnerable consumer can be consulted here.

It also extends the validity of the electric social bond to the beneficiaries who had to renew their application, who will be able to carry out the process until September 15.

‘Unemployment of the self-employed’ by cessation of their activity

The Government has regulated for this crisis an extraordinary benefit for cessation of activity, the so-called ‘unemployment of the self-employed’, which will be 70% of the regulatory base on which the self-employed person quotes. When the worker has not paid the minimum period to be entitled to the cessation of activity benefit, “the amount of the benefit will be equivalent to 70% of the minimum contribution base” for the self-employed.

Who can qualify? Self-employed workers whose activities are suspended or “when their turnover in the month prior to which the benefit is requested is reduced by at least 75%” in relation to the average of the previous semester. During the collection of the benefit, the worker “will not pay the social contributions to the Social Security and the period will be considered as a contributor”, they explain in the Social Security.

The duration of the benefit will be “one month”, extendable “until the last day of the month in which the alarm state ends, in the event that it is extended”. The perception of this benefit is “incompatible with any other benefit of the Social Security system”.

Coronavirus ERTEs are “force majeure”

ERTEs, whether for contract suspensions or shorter working hours, that have their direct cause in loss of activity as a consequence of COVID-19 will be considered “force majeure” ERTEs, which have a more agile procedure than the rest. For example, there is no consultation period with workers and they only require the approval of the labor authority within 5 days.

The decree specifies situations that clearly fall within this “force majeure”, such as those in which the declaration of the state of alarm implies the suspension or cancellation of activities, the temporary closure of places of public influx or due to lack of supplies , among others (article 22 of the decree). The procedure for presenting these ERTEs to the labor authority is also detailed.

When the company decides to apply an ERTE “for economic, technical, organizational and production reasons” (not force majeure), but is also related to the coronavirus, the procedures are shortened: maximum 5 days to form the negotiating commission and 7 days for the consultation period. The report of the Labor Inspection must also be within a non-extendable period of 7 days.

Improvement in unemployment protection

Unemployment protection in ERTE is improved. All workers affected by the file will be entitled to the contributory benefit (70% of the contribution base), even if they have not contributed the minimum for it. In addition, the time during which the benefit is collected will not subtract for the future collection of unemployment: the unemployment benefit rights generated so far remain intact.

The Minister of Labor explained this Wednesday that Advantageous measures for ERTEs caused by the coronavirus crisis will have retroactive effect: they reach the files initiated before the entry into force of the decree.

These conditions of unemployment can also be used by people “who have the status of worker members of labor companies and associated work cooperatives who plan to contribute due to the unemployment contingency.”

In addition, discontinuous permanent workers who have had their employment contracts suspended as a result of the impact of the coronavirus (and who would have worked otherwise in that period), will be able to receive unemployment benefits “with a maximum limit of 90 days”.

Automatic extension of unemployment benefit

During the effective period of the extraordinary measures for the epidemic, the SEPE may ex officio extend the right to receive the unemployment benefit, “so that the lack of application does not lead to the interruption of the perception of the unemployment benefit or the reduction of its duration”. In the case of the subsidy for unemployed people over 52 years of age, “the payment of the subsidy and the Social Security contribution will not be interrupted even when the presentation of the required annual income statement is made outside the legally established period.”

Exemption in the payment of fees in the ERTE

Companies are exempt from the payment of social security contributions to workers affected by ERTE. There are two situations: total exemption from quotas for companies with less than 50 workers and for companies with more, the exemption “will reach 75% of the business contribution.” This has no effect for working people, “maintaining the consideration of said period as effectively quoted for all purposes”, for example, retirement.

Adaptation and reduction of working hours

Despite your announcement, the Government in the end has not regulated a Social Security benefit for workers to take care of in this health crisis. The Executive has opted to regulate, for this exceptional circumstance, the right to adapt and reduce the hours of employees to care for their dependent relatives. It is “an individual right” of each of the parents or caregivers.

Who can request it? Workers employed by others, who prove “duties of care with respect to the spouse or domestic partner, as well as with respect to relatives by blood relationship up to the second degree of the working person” when “exceptional circumstances related to the actions necessary to avoid the community broadcast of COVID-19 “.

What are those exceptional circumstances? When the presence of the worker is necessary for the care of these people who, “for reasons of age, illness or disability, need personal and direct care as a direct consequence of COVID-19”. Also due to the closure of educational centers or of any other nature due to the epidemic and when the person who habitually takes care of the dependent “could not continue to do so for justified causes” related to the coronavirus.

About the adaptation of the day: it is marked as a limit “as long as it is justified, reasonable and proportionate”, taking into account the specific needs of care and the organizational needs of the company. “The company and the working person must do everything possible to reach an agreement,” states the decree-law. Job sources explain that if the company wants to refuse, “the employer is the one who must prove that the request is not justified, reasonable and proportionate. Not the contrary.”

The right to adjust the working day may refer to working time or another aspect of working conditions. It may consist of shift change, flexible hours, split or continuous shift, change of work center or telework, among others.

About the reduction of working hours: It implies the proportional reduction of the salary. You can even demand a reduction of 100% of the working day, so that the worker would be without income. This circumstance will cause workers to opt more for adaptation and not for reducing the working day, “which allows them to keep their work and their remuneration, or low intensity reductions in order to lose the minimum amount of remuneration,” states the legal text.

The reduction of the special working day “must be communicated to the company 24 hours in advance”. As the current possibility of reducing the entire working day is extended, the decree establishes for that case that “the right of the working person must be justified and reasonable and proportionate to the situation of the company.”

If a worker is already enjoying an adaptation of the working day to conciliate or a reduction for care “he may temporarily renounce it or he will have the right to have the terms of his enjoyment modified as long as the exceptional circumstances envisaged are present” for this emergency.

“Preferred” nature of teleworking

The Government orders the priority of the measures that companies can implement to continue with the activity in this crisis, “particularly remote work”, which “should be a priority against the temporary cessation or reduction of activity”, that is, the ERTE.

The Executive opens his hand with the requirement of the evaluation of occupational risks in teleworking, which is the responsibility of the company. In this emergency, “the obligation will be understood to have been fulfilled”, exceptionally, “through a self-assessment carried out voluntarily by the worker himself”.

Fund with 300 million for social care

The concession of a credit supplement amounting to 300 million euros for a Contingency Fund is collected, for transfers to the Autonomous Communities, Ceuta and Melilla to finance “the basic benefits of social services” that are “exclusively” cope with extraordinary situations arising from the coronavirus epidemic.

This fund may be used for “project financing and labor contracts” necessary to: reinforce home-based proximity services, such as guaranteeing care for the elderly; reinforce homeless care devices; and expand the provision of minimum incomes for families without resources “to ensure coverage of their basic needs” in this emergency, among others.

Public contracts for the coronavirus

Article 34 develops a wide series of possible situations regarding public contracts and the epidemic, among which we highlight some. The contracts of “services and supplies of successive provision” concluded by entities belonging to the Public Sector “whose execution becomes impossible” in this health emergency “will be automatically suspended as from the factual situation that prevents their provision and until said benefit can be resumed. “

When the execution of a public contract is suspended, “the contracting public entity must pay the contractor the damages and losses actually suffered by it during the suspension period, upon request and reliable proof of its reality, effectiveness and amount by the contractor” . The decree details the damages for which the contractor may be compensated, such as “the salary expenses that the contractor would have actually paid to the staff” during this period, among others.

The extension of public service provision contracts is also agreed when their validity expires these days, but “the new contract that guarantees the continuity of the provision would not have been formalized” as a consequence of the state of alarm by COVID-19.

Company guarantees without details of how they will be given

Pedro Sánchez announced a mobilization of 200,000 million to face the economic collapse of the coronavirus, of which 117,000 would be borne entirely by the state. Of those, 100,000 are a line of guarantees, without budgetary cost, to avoid a credit crisis. This means that companies and freelancers can request loans “to meet their needs derived from the management of invoices, the need for currency, maturities of financial obligations or other liquidity needs” and it is the State that assumes the risk.

The decree does not detail the conditions or requirements necessary to access these guarantees: neither if they must be companies affected by the crisis nor if they must commit to maintaining employment.

According to sources from the Ministry of Economic Affairs, the details of the conditions are being studied with Europe so that they do not clash with the State aid regulations. The conditions will come in another Council of Ministers.

More limit to borrow from the ICO

On the other hand, the debt limit of the Official Credit Institute is extended, which has several lines of credit enabled for companies and the self-employed. In the 2019 General State Budgets, the limit is set at 5,900 million. With this royal decree, it is expanded to 10,000. The agency will be in charge of adopting “the necessary measures” to make available financing more flexible and improve access to credit for companies.

This measure is in addition to the one approved last week, which expanded the credit line of those affected by the Thomas Cook crisis, approved last summer with funds of 200 million euros. Although Sánchez sold the Covid-19 as a new line for 400 million euros, the reality is that it was an increase of 200 million over that of Thomas Cook. In fact, the line is now called ICO Covid 19 / Thomas Cook.

Fixed and mobile portability suspended

While the alarm state is in force, “all fixed and mobile numbering portability operations that are not in progress will be suspended, except in exceptional cases of force majeure.” In addition, telephone companies are prohibited from carrying out “extraordinary commercial campaigns to contract electronic communications services that require number portability.” No calls to change phone company during alarm.

The return of products is postponed

During the validity of the Alarm State or its possible extensions, “the deadlines for the return of the products purchased by any modality are interrupted, either in person or online.” The calculation of the terms to return them will be resumed when the alarm status loses effect.

Safer for export

For small and medium-sized exporting companies, in which at least 33% of their business is international, an extraordinary line of 2,000 million euros of insurance coverage is enabled. Insurance will be granted by the Spanish Export Credit Insurance Company.

Moratorium on payment of agricultural loans

Farm owners who have loans as a result of the 2017 drought will be able to extend the payment up to one year. Those who want to access this deficiency must request it in the next four months at the Sociedad Anónima Estatal de Caución Agraria (SAECA).

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