Government increases level of social protection for least secure workers

In March 1998, the Spanish Government approved two decrees that raise the level of social protection guaranteed for those employed on training contracts and "reduced part-time" contracts. It has thereby fulfilled the commitment it made to the social partners following the "April agreements" of 1997, although some measures contained in the decrees have been criticised by the trade unions.

On 27 March, the Spanish Government approved two decrees on training contracts (contratos de formación) and on "reduced part-time" contracts (contratos a tiempo parcial reducido). These decrees aim to increase the level of social protection guaranteed in these kinds of employment contract. From now on, workers with training contracts will be entitled to full social benefits for temporary incapacity. Moreover, workers with reduced part-time contracts (that is, those covering work for less than 12 hours a week or 48 hours a month) will be entitled to all benefits (pensions, unemployment benefit and temporary incapacity benefit). The Government has thus fulfilled the commitment that it made to the social partners after the "April agreements" - on employment stability, collective bargaining and filling the gaps in regulation - were concluded in 1997, although almost one year later (ES9706211F).

The decree on training contracts also covers other issues that were contained in the April agreements. It reinforces the training component of the contract by providing more detailed specifications and guarantees concerning the employer's obligation to provide the worker with theoretical and practical training. A greater role is also given to collective bargaining: collective agreements in companies will establish the number of training contracts that may be entered into, according to the size of the workforce. The decree establishes a scale of thresholds that ranges from one contract for companies with between one and five workers up to 30 contracts (or a number of contracts equivalent to 4% of the workforce) for companies with over 500 workers.

This set of measures has been well received by the social partners, and especially by the trade unions. In fact, since the labour reforms of 1994 the unions have been calling for a fairer training contract with a greater degree of social protection and guarantees of training, and they rejected the formula of reduced part-time contracts because it offered hardly any kind of social protection.

However, the trade unions have criticised other measures included in the decree on part-time contracts. The Government has approved a 55% reduction in employers' social security contributions for "secure" reduced part-time contracts and a 45% reduction for temporary part-time contracts. In the Government's opinion, these measures help to create jobs, and provide incentives for a type of contract that promotes worksharing. The trade unions, however, believe that this type of measure promotes an extremely unequal distribution of work - and income - because it promotes only the most insecure contracts, besides involving a reduction in the income of the social security system that is not compensated for by the general state Budget.