T E N E R I F E ’ S O N LY Issue 669
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W E E K LY N E W S PA P E R
10 September 2010 - 16 September 2010
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Employers benefit from new regime Spain’s new labour reform package gets the green light THE Spanish Government’s muchdisputed new labour reform package was rubber-stamped yesterday (Thursday), although it failed to please everyone. But the changes, deemed essential for cutting the soaring jobless rate and reviving the fragile economy, will prove to be a blessing for employers and workers throughout Spain and the Canary Islands. There were a few alterations made before the legislation was passed, and the Socialist government received criticism from all sides - especially from angry union chiefs. Yet something had to give to offer the country a fighting chance of clawing its way out of the recession and on the road to recovery. The main victory for Prime Minister José Luis Rodríguez Zapatero’s government is the right to remove unemployment benefit after 30 days if the recipient does not agree to go on a training course. The previous limit was 100 days. The reforms, which have been discussed for months, will also make it easier and cheaper for companies to fire workers. When the government’s discussions with unions and employers collapsed in June, the two main unions called a general strike for 29th September in protest which, as far as Canarian Weekly is
aware, is still going ahead. The International Monetary Fund has stressed that the labour reforms are “absolutely crucial” if Spain is to cut its appalling 20% jobless rate, and rein in the massive public deficit. The agreement between Zapatero’s PSOE party and the PNV Basque Nationalist Party on redundancy means
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that the final document offers 20 days pay per year worked as compensation. It can be applied if there are “current or forecast losses”, or the “persistent reduction of income levels” within the business. Worker can also lose their jobs if their absenteeism reaches 20% of days in a twomonth consecutive period, or
25% over four separate months in the same year, provided the average absenteeism is not over 2.5% in both cases. On the other hand, a worker with the same company for three years on a temporary contract will now have to be given a fixed contract, so this is in the best interests of the employee. An amendment from the PNV which considered that this should apply only when the person has actually carried out the same job, has not been included in the legislation. The concept of “partial
unemployment”, as suggested by the BNG, Galician Nationalists, was accepted. This means that benefits are calculated using hours and not days worked. Elena Salgado, Minister for Tax and the Economy, said the reforms would allow Spain to climb positions in the world competitiveness rankings. Unfortunately for her, the remark came the day after data showed that Spain had fallen nine places in the World Economic Forum index to No.42. Top of the list are Switzerland, Sweden and Singapore. José Ignacio Echániz, the PP
spokesman, said that the Government was “completely alone” in the legislation, without the support of either the political parties or the unions. He added: ‘It is the first labour reform in history where a Government has not been supported by anyone.” Meanwhile, Celestino Corbacho, the Minister for Unemployment, has said that one in three people collecting the 426-euro extraordinary monthly payment - given to the unemployed whose regular entitlement had expired has found work. The government has been steadfast in its defence of the new measures. Jose Blanco. Minister of Public Works and Transport, said: “Unemployment continues to be the main economic challenge facing the country and the new measures will generate employment and stability. “The measures are positive for all workers, for those who have jobs as well as those who are trying to find them. Even though this reform will not be enough to resolve all our employment problems, it will make the path easier.” Spain plunged into its worst recession in decades at the end of 2008, following the collapse of a decade-long property boom. It returned to tepid growth only this year. Zapatero’s government passed a 15-billion-euro austerity plan in May, aimed at shoring up Spain’s public finances amid investor concerns that the country could follow Greece into a financial crisis. The plan was on top of a 50billion-euro package of spending cuts announced in January, designed to cut progressively the public deficit to the eurozone limit of 3% of gross domestic product (GDP) by 2013.