Spain: Developments in working life – Q1 2016

The discussions and deals between political parties after the general election of December 2015, the slow recovery of the labour market and trade union membership losses are the main topics of interest in this article. This country update reports on the latest developments in working life in Spain in the first quarter of 2016.

Political uncertainty after the general election

The general election of December 2015 resulted in the most fragmented Spanish parliament in modern history. In February 2016, the Spanish Socialist Workers' Party (PSOE) and Citizens – Party of the Citizenry (Ciudadanos) signed a deal to govern as a coalition, but failed to win the support of other parties. In their agreement, PSOE and Ciudadanos had arranged to suppress or modify some parts of the 2012 Labour Reform and to create a new ‘stable and progressive’ contract for temporary workers. It remains to be seen how discussions progress and if new agreements can be reached. But if no new coalition deal is signed, another general election will be called in June. As a result of this uncertainty, some experts say that since the end of 2015, many companies have been preparing employment adjustment plans, retirement plans and modifications of working conditions because they fear a new government will change the legal framework.

During the first quarter of 2016 there was an interesting issue high on the political agenda, not linked to governance deals. Mariano Rajoy, Spain’s acting Prime Minister, has proposed that the working day should end at 18:00 with shorter lunch breaks and creating a ‘bank of hours’ (in order to avoid long working hours), bringing the country into line with its European counterparts.

Slow recovery of the Spanish labour market

Overall data show that 2015 was generally a good year for the job market, although the unemployment rate was still 20.9%, according to the Economically Active Population Survey (1.22 MB PDF) released in January 2016. Employment figures for 2015 are also good: the year ended with an additional 525,100 people in work, making a total of just over 18 million. However, data regarding the quality of employment are not so positive. The number of people with higher-quality contracts (such as indefinite, full-time contracts) has fallen, whereas the number of workers on precarious contracts (fixed-term or part-time contracts) has risen. Moreover, data released by the Ministry of Employment (based on Social Security registers) show that the average duration of contracts has decreased from 79 days in 2006 to 53.4 days in 2015. Experts argue that all these trends are symptoms of the increasing precariousness of work in the Spanish labour market, in spite of the progressive (but slow) recovery of the Spanish economy.

Recent research shows that long-term unemployment is much more widespread and entrenched in Spain than in the rest of the OECD (the Organisation for Economic Co-operation and Development). However, in 2015, 19,266 people registered with work-related illnesses in Spain; 1,876 more than in 2014 (+11%). It is also worth mentioning that the number of employees working full or part-time from home decreased by more than 95,000 between 2013 and 2014, which may suggest that the number of teleworkers is decreasing for the first time since the beginning of the crisis.

Trade unions lost more than half a million affiliated members during the crisis

Between 2009 and 2015, trade union Workers’ Commissions (CCOO), the General Union of Workers (UGT), the Central Independent Trade Union of Civil Servants (CSI-F) and the Workers Union (USO) (the four main trade unions in Spain, which represent around 80% of workers) lost a total of 584,788 affiliated members. The economic crisis, high unemployment levels and scandals linking trade union leaders to corruption cases seems to have affected trade unions’ representativeness levels in Spain. Against this background, Pepe Álvarez, who became leader of the UGT in March 2016, has said he will renew the union’s internal organisation and improve its image.

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