COVID-19: Publication of the new extension of ERTEs, unemployment protection measures and the 'Plan Mecuida' work/life balance program

Listed below are the main new provisions on Spanish “ERTE” temporary collective layoff procedures:

• An automatic extension until May 31, 2021 has been granted for ERTE temporary layoffs due to force majeure under article 22 of Royal Decree-Law 8/2020, of March 17, 2020.
• An extension has also been allowed for any ERTE temporary layoffs due to impediment to operations authorized on the basis of paragraph 2 of additional provision one of Royal Decree-Law 24/2020, of June 26, 2020, which will remain in force in the terms of the decisions that authorized them. The same has been decreed for those authorized on the basis of article 2.1 of Royal Decree-Law 30/2020, of September 29, 2020, on social protection measures to defend employment.
                
  During the period of closure and until May 31, 2021, extraordinary measures in relation to social security contributions will be available for these ERTE temporary layoffs: for companies with fewer than 50 workers as of February 29, 2020, relief has been made available equal to 100% of the employer’s contributions during the period of closure until May 31, 2021, and 90% in the case of companies with 50 or more workers.
                 
  An option has also been granted to apply for new ERTE temporary layoffs due to this reason between February 1, 2021 and May 31, 2021, for which the relief on contributions described above will be available. If the company’s circumstances change, the labor authorities and the workers’ statutory representatives must be notified of the change to its circumstances, the date it took effect, and the affected workplaces and individuals.
• Additionally, ERTE temporary layoffs due to restrictions in force to the normal course of business, based on article 2.2 of Royal Decree-Law 30/2020, of September 29, 2020 have been automatically extended until May 31, 2021.
                      
  The following types of relief have been made available for these ERTEs, from February 1, 2021:
           
  a) For companies with fewer than 50 workers or individuals treated as if they were employees who are registered for social security purposes as of February 29, 2020, the relief on employers’ contributions falling due in February, March, April and May 2021 will be equal to 100%, 90%, 85% and 80%, respectively.
                
  b) For companies with 50 or more workers or individuals treated as if they were employees who are registered for social security purposes as of February 29, 2020, the relief on employers’ contributions falling due in February, March, April and May 2021 will be 90%, 80%, 75% and 70%, respectively.
• The option to apply for ERTE temporary layoffs on economic, technical, organizational or production related grounds (ETOP) linked to COVID-19 has been retained between the entry into force of this royal decree-law and May 31, 2021 in the terms of article 3 of Royal Decree-Law 30/2020, of September 29, 2020.
                  
  Applications are allowed to continue for extensions of any ERTE temporary layoffs on economic organizational or production related grounds (ETOP) that end over the term of this royal decree-law if an agreement is reached in the consultation period. All extensions must be notified to the labor authorities.
• An extension has been granted of the limits and provisions related to the distribution of dividends and tax transparency for all ERTE temporary layoffs authorized before or under this new royal decree-law.
• It has also extended  the  safeguard of employment as provided in article 5 of Royal Decree-Law 30/2020, both in relation to earlier periods and as a result of the benefits contained in this new royal decree-law.
• Also remaining in force are the limits and exceptions in relation to working overtime, new contracts and outsourcing, until May 31, 2021.
• Other provisions that have been kept until May 31, 2021 are the requirement not to treat force majeure and the objective grounds for ERTE temporary layoffs as grounds for dismissal (commonly known as the “dismissal ban”) and the requirement to stop the clock on temporary contracts  affected by suspension of the contract.

As for unemployment protection measures, those contained in articles 8, 10 and 11 of Royal Decree-Law 30/2020, of September 29, 2020, including allowing individuals not to use up their time limit for unemployment benefit have been extended until May 31, 2021. Furthermore, any companies that had already filed a collective application for access to unemployment benefit under article 8.2 of Royal Decree-Law 30/2020 will not be required to file a new application in relation to any workers included in an earlier one.

The decree-law also states that Plan MECUIDA, a program containing measures to achieve a work/family life balance as a result of the circumstances caused by COVID-19, will remain in force until May 31, 2021.

Lastly, the minimum contribution bases in 2021 will be those in force as of December 31, 2019, until the minimum wage for 2021 is determined.