The rise in wages is seen as the "main stumbling block" in the state negotiation between employers and unions

The majority employers and unions (CEOE, Cepyme, CCOO and UGT) sat down this Thursday to start the technical negotiation of this pact at the state level, which serves as a reference for companies and workers in the country in labor negotiations. As always, the rise in wages is the main element in the talks, but more this year due to high inflation and especially now before the war in Ukraine.

"During today's meeting, the matters that are to be introduced in the next AENC have been raised and there has been talk of promoting labor reform through collective bargaining," CEOE sources explain. "A large part of the meeting has served to address the salary issue, which is the main stumbling block," they add.

Businessmen are limited to reiterating that their commitment this Thursday has been "moderation" of wages, an idea that its president, Antonio Garamendi, insisted on this morning. In addition, he left a message in the form of a specific number. Garamendi has pointed out that the salary increase that has been applied since January to CEOE staff is 2.5%. "We think that we are the first to set an example," he pointed out. He has also responded that the UGT demand for an increase of 5% for this 2022 does not seem "reasonable".

On the 9th there will be talk of "figures" of increase

From the unions they confirm the starting confrontation in salary matters. Mari Cruz Vicente, secretary of trade union action and employment of the CCOO, has maintained that "there is a coincidence of the issues" to be dealt with in what would be the fifth AENC, among which she has mentioned "training, digitization, energy transitions" and the aspects of the labor reform that were derived from collective bargaining. "The most controversial issue, as expected, are wage increases," she said.

The CCOO and UGT unions insist that the uncertainty of the moment requires that the salary negotiation include a clause guaranteeing purchasing power in the short term. In other words, a tool that would allow more limited increases to be agreed now, also in accordance with a situation of inflationary risk. But they demand that the price increase not fall only on "the shoulders of the workers", but that at the end of a period (two or three years) the templates be guaranteed that they will not have lost purchasing power.

"Here (regarding wages) we have limited ourselves to exchanging views, analyzing the economic situation that has occurred after the invasion of Ukraine," explained Mari Cruz Vicente. That is to say, how can the war affect the Spanish economy and, above all, "the impact on inflation". The anticipated price increase by the international crisis is key to the debate on wages.

According to Vicente, the conversation this Thursday has not revolved around salary increase figures. "Each one of us has made our proposals, our analyses. At this time we have not entered into percentages or specific figures. We will meet again on the 9th in the afternoon, with the commitment to bring something more concrete in terms of salary increases and newsrooms. rest of the points" of the negotiation, he added.

An agreement marked by war in Europe

This Thursday's appointment marked the formal start of the negotiation, although the conversations between the leaders of the social agents have been going on for "days", the president of CEOE, Antonio Garamendi, warned this morning. The AENV does not oblige, but it consists of a roadmap that serves as a reference for companies and workers at the state level on different key labor issues, such as wages but not only, for this 2022 and the next two or three years. The latest agreement covered the period from 2018 to 2020.

Like so many other things, the deal has taken a different turn in the past week. Before February 24, the unions had much more interest than the employers in reaching this pact at the state level. Especially as it affects wages given the high inflation –due above all to energy prices– and the loss of purchasing power that workers suffer. In 2021, the wage increases agreed upon in the agreement reached 1.47%, while the year-on-year CPI closed December at 6.5%, with average inflation of 3.1%.

But on February 24 the perspective changed. Russian President Vladimir Putin invaded Ukraine last Thursday, sparking a war in Europe. A scenario that very few expected and that now conditions not only the future of the Ukrainian population, but also the economy of the continent. As minimum. "We are seeing what the inflationary effect has been, to which are now added the effects of the war, because the reality is that we are at war, that Europe is at war, and the world of the economy is going to be affected," he said. Garamendi said.

Faced with the uncertainty that the war scenario opens and the economic sanctions for the invasion, the AENC pact has also become a key piece for the Government in terms of "stability" and "confidence" in the country. This was highlighted by the President of the Government, Pedro Sánchez, in his appearance in Congress this Wednesday. The leader of the Executive summoned the social agents to reach what he called an "income agreement", by which workers and companies shared the impact of this international crisis. The first vice president, Nadia Calviño, and other economic ministers, such as Yolanda Díaz and José Luis Escrivá, have insisted on this idea in recent days.