COVID-19 Spain: Royal Decree-Law on extraordinary employment measures in relation to COVID-19

By Miguel Pastur

03-2020

On 18 March, the Spanish Government published a new regulation that includes employment measures for those sectors and industries affected by the effects of COVID-19.

I. Exceptional measures in relation to the procedures for suspension of employment contracts and reduction of working hours due to force majeure causes

Companies may implement the suspension of employment contracts and reduction in working hours due to force majeure causes. According to the content of the Royal Decree-Law, the following circumstances are considered force majeure causes:

  • Economic losses directly derived from the measures adopted by the government –i.e. the state of alarm declaration that imply the suspension or cancellation of activities, the temporary closure of premises with public influx, restrictions on public transport and, in general, mobility of citizens or goods. Clarification is still needed on how strict the administration will be in the interpretation of these clauses;

  • Lack of supplies that seriously impede the development of the Company's activity; and

  • Infection of any of the employees or if any of them is in quarantine, properly justified by the medical authorities.

Application procedure:

(i)  The Company must submit an application request to the competent Labour Authority together with a report which contains the explanation of the correlation between the proposed measure and the measures implemented by the Government. These documents must be accompanied by the corresponding documents evidencing the allegations presented by the Company. The Company must also inform the employees of the suspension request made to the Authority, and provide a copy of the request and accompanying documents to the workers' representative, if any.

(ii)  The Labour and Social Security Inspectorate may issue a report within a maximum period of five days, if the Labour Authority considers it appropriate (its request is not mandatory).

(iii)  The Labour Authority must issue a resolution within five days.

II. Exceptional measures in relation to the procedures for suspension of employment contracts and reduction of working hours due to economical, technical, organisational and productive causes

The applicable procedure will be that established in article 47 of the Spanish Employment Act with some exceptions that are detailed below:

(i)  This procedure requires a previous negotiation period with the employee's representatives.

In the event that there are no employee representatives, the consultation period will be carried out by the most representative unions in the sector to which the Company operates.

If it is not possible to constitute the previous representative commission, consultation will be carried out with up of three employees of the Company democratically elected. In this case, the procedure established in article 41.4 of the Spanish Employment Act will apply.

In any case, the representative commission must be constituted within a maximum period of five days.

III. Extraordinary measures regarding Social Security contributions in relation to the procedures for suspension of employment contracts and reduction of working hours due to force majeure related to COVID-19
  • The General Treasury of the Social Security will exempt those companies who have less than 50 employees from the payment of the Company's contributions to the Social Security

  • For those companies that have 50 or more employees, the General Treasury of the Social Security will exonerate 75% of the Company's contributions to the Social Security during this period.

  • Such exemptions will be conditioned to the Company keeping the employment levels in the six months following the re-activation of normal activity.
IV. Extraordinary measures regarding unemployment protection due to the application of the suspension of employment contract or the temporary reduction of working time

Employees who are affected by the suspension of their employment contracts or the temporary reduction of the working hours due to organisational, productive or force majeure causes will be entitled to the following measures:

  • Employees who, even though they lack the required minimum contribution period, will be entitled to the unemployment benefit.

  • The period in which employees receive an unemployment benefit as a result of these extraordinary circumstances will not be computed as regards the maximum periods of unemployment benefits legally established, if they lose their job in the future.

The duration of the unemployment benefit will last until the end of the period of suspension of the employment contract or temporary reduction of the working hours.

V. Telework

Regarding those companies and job positions in which teleworking was not previously implemented, this becomes strongly recommended (also to avoid job loss), and the urgency required by the current exceptional situation implies that the Labour and Social Security Inspection will consider that occupational risk prevention obligations are fulfilled provided that each employee carries out a self-evaluation.

VI. Right of the employees to adapt working conditions and reduce working hours due to exceptional care circumstances related to COVID-19

Employees who can prove care duties to people who require their support (i.e. spouse or unmarried partner, as well as those relatives related by blood up to the second degree), will be entitled to adapt and/or reduce their working hours when exceptional circumstances arise,, such as the actions put in place to avoid the spread of COVID-19. Said exceptional circumstances shall be understood to exist when:

(i)  The presence of the employee is necessary to take care of any of the aforementioned persons who, for reasons of age, illness or disability, need personal and direct care as a consequence of COVID-19.

(ii)  In the event that the Spanish Government implements specific measures that imply the closure of education centres – as is currently the case.

(iii)  In the event that the employee must replace the person who, until now, was entrusted the care or assistance of the aforementioned persons due to COVID-19 causes.

The employee is entitled to specify the adaptation of the working hours due to care duties based on exceptional circumstances related to COVID-19. This adaptation of the working day must be justified by the employee as reasonable and proportionate. The Company and the employee must reach an agreement on its terms.

(iv)  "Special reduction in working hours": those employees who, due to guardianship reasons, have children under the age of twelve or a disabled person that does not perform a paid activity, will be entitled to a reduction in working hours of up to 100%. The employee's salary will be reduced in proportion to the reduction in working hours. It is required that the employee notifies the Company 24 hours in advance.

(v)  In the event that an employee's working time was already reduced due to conciliation reasons or due to child or relative care, he/she may temporarily renounce to that reduced working time or change the terms of his/her reduced working time in order to adapt it to the exceptional circumstances.