Dialogue between the Spanish social partners focused in late 2001 on the long-running controversy over the cost of dismissal - which is regarded as high in Spain - and its relationship with the country's high level of temporary employment. Employers and trade unions have made proposals on reform in this area.
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Dialogue between the Spanish social partners focused in late 2001 on the long-running controversy over the cost of dismissal - which is regarded as high in Spain - and its relationship with the country's high level of temporary employment. Employers and trade unions have made proposals on reform in this area.
Over late 2001, the continuing social dialogue between the central organisations of employers and trade unions (ES0109207N) focused on the perennial issues of employment stability and the cost of dismissal. On the question of promoting permanent recruitment, the Spanish Confederation of Employers' Organisations (Confederación Española de Organizaciones Empresariales, CEOE) and Spanish Confederation of Small and Medium-sized Enterprises (Confederación Española de la Pequeña y Mediana Empresa, CEPYME) attribute the high percentage of temporary employment in Spain to the relatively high cost of compensation for dismissal (ES0012226F). They also claim that the statistics on the high level of temporary employment in Spain (ES0109201F) should be seen in the light of the nature of the Spanish labour market, which includes many seasonal sectors such as tourism and construction. In the employers' opinion, a form of economic growth must be sought that creates a balance between permanent and temporary employment.
The employers' organisations propose modifying Article 56 of the Workers' Statute in order to set the cost to employers of dismissal at 33 days' wages per year of service, with a maximum of 24 months' wages, for all workers - this level of compensation currently applies only to some types of contract. An alternative would be to extend to all dismissals the compensation provisions of Law 63/97 (based on the April 1997 intersectoral agreement on employment stability - ES9706211F), which currently cover the special employment employment-promoting contracts (attracting reductions in employers' social security contributions) for people aged 16 to 33 years, people over 45 who have been unemployed for at least six months, women and disabled people (ES0103237F). CEOE and CEPYME also propose abolishing the current system whereby a dismissed worker receives 'interim wages' between the date of dismissal and its confirmation by the courts. In exchange for this, it would be possible to increase the compensation for dismissal applicable to temporary contracts.
The Trade Union Confederation of Workers' Commissions (Comisiones Obreras, CC.OO) and General Workers' Confederation (Unión general de Trabajadores, UGT) both responded that the main causes of employment instability in Spain are the unjustified use of temporary contracts to cover stable jobs and the insufficient regulation of outsourcing and subcontracting. If these aspects of industrial relations were regulated, if temporary and permanent contracts were treated more equally, and if temporary workers were given information on and preference for permanent vacancies, the trade unions would accept the prolongation of the abovementioned special open-ended contracts to foster employment (with compensation for dismissal set at 33 days' pay per year of service) for another four years. The types of unemployed persons who could be employed on these contracts could also be extended and a selective reduction of employers' social security contributions could be negotiated for new recruits or for companies with stable workforces.
Eurofound recommends citing this publication in the following way.
Eurofound (2002), Social dialogue focuses on cost of dismissal, article.
