ERTEs: The Newest Trending Topic

Published on 2 July 2021

ERTEs due to force majeure based on causes related to COVID-19 and ERTEs due to impediments to and/or limitations on activity as a consequence of the pandemic have been extended for the fifth time.

Are ERTEs the new trending topic? Yes. They are probably one of the most popular topics of conversation nowadays and a source of long discussions and headache for many companies. During pandemic times, this regulatory recourse, unconsidered prior to COVID-19, has managed to position itself on the forefront of public dialogue.

And this is with good reason: ERTEs due to force majeure based on causes related to COVID-19 and ERTEs due to impediments to and/or limitations on activity as a consequence of the pandemic have been extended for the fifth time.

Key points of the new Royal Decree-Law governing ERTEs in Spain

These are the new key points in this extension:

1. Automatic extension of EREs due to force majeure based on causes related to COVID-19 and ERTEs due to impediments to and/or limitations on activity as a result of the pandemic until 30 September 2021.

2. In terms of exemptions from contributions to the Social Security:

  1. ERTE due to impediments to activity as a consequence of the pandemic
    1. Companies with fewer than 50 workers
      1. 100% exemption from June to September of 2021
    2. Companies with 50 or more workers
      1. 90% exemption from June to September of 2021
  2. ERTE due to limitations on activity as a consequence of the pandemic
      1. Companies with fewer than 50 workers
        1. 85% exemption in June and July of 2021
        2. 75% exemption in August and September of 2021
      2. Companies with 50 or more workers
        1. 75% exemption in June and July of 2021
        2. 65% exemption in August and September of 2021
  3. Companies belonging to sectors with a high rate of ERTEs and a low rate of recuperation of activity
    1. Companies whose workers affected by an ERTE reinitiate their activity from 1 June 2021
      1. 95% exemption from June to September of 2021 (fewer than 50 workers)
      2. 85% exemption from June to September of 2021 (50 or more workers)
    2. Companies whose workers continue to be affected by an ERTE
      1. 85% exemption from June to August of 2021 and 70% exemption in September of 2021 (fewer than 50 workers)
      2. 75% exemption from June to August 2021 and 60% exemption in September of 2021 (50 or more workers)

3. The list of the Spanish Classification of Economic Activities (CNAE) of the companies belonging to sectors with a high rate of ERTEs and a low rate of recuperating activity is amended: five sectors are eliminated and three new ones are included.

4. Simplification in processing is maintained for those companies with ERTEs due to impediments or limitations that wish to switch from one to another and the same terms for processing are maintained for new ERTEs.

5. The prohibition on dismissals based on force majeure or economic, technical, organisational and/or production-related reasons related to COVID-19 is extended until 30 September 2021.

6. Companies’ commitment to maintaining employment is maintained for six months from when activity is resumed.

7. Limits on the distribution of dividends and tax transparency, working extra hours, new outsourcing and the interruption in the calculation of the term in fixed-term contracts are maintained.

8. “Plan MECUIDA” is extended until 30 September 2021. This plan is related to requesting workday adaptation and/or reductions in working hours when certain exceptional circumstances are present related to actions necessary to avoid community transmission of COVID-19.

As you can see, just when we thought we were rid of it, this regulatory recourse comes into the picture once again in the form of a Royal Decree-Law. It seems, just as with the pandemic that launched it into the public eye, that it will be with us for a few months more…for now, until 30 September 2021.

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