Royal Decree Law 2/2021 of 26 January on the reinforcement and consolidation of social measures in defence of employment: relevant points

The new Royal Decree-Law provides for the extension of all Temporary Layoffs (ERTE) based on causes related to COVID 19.

Within these ERTEs, exemptions are again granted to companies that are holders of ERTEs and belong to sectors with a high rate of coverage by the file and a low rate of activity recovery.

ERTEs DUE TO FORCE MAJEURE, IMPEDIMENT AND LIMITATION OF ACTIVITY

  • ERTEs due to force majeure and activity limitation are automatically extended until 31 May 2021.
  • ERTEs for current impediment will be maintained in accordance with the terms of the corresponding resolutions.
  • ERTEs may continue to be applied for on the basis of an impediment or limitation of activity until 31 May 2021.

ERTEs ETOP 

Covid ERTEs based on economic, technical, organisational and production (ETOP) causes may continue to benefit until 31 May 2021 from the simplification of procedures and the possibility of requesting an extension by submitting to the labour authority an agreement to that effect with unitary or trade union representatives.

LIMITATIONS AND COMMITMENTS

They are still in force:

  • Safeguarding employment – in accordance with the relevant deadlines.
  • Prohibition of hiring and overtime – until 31 May 2021.
  • Prohibition of dismissal and extension of temporary contracts – until 31 May 2021.
  • Limits on dividend distributions and tax transparency – until 31 May 2021.

EXTRAORDINARY MEASURES ON UNEMPLOYMENT PROTECTION

  • Extraordinary unemployment protection measures are extended until 31 May 2021.
  • For workers affected by ERTE, the time during the unemployment benefit is received will not be counted as having been used up if they receive a new benefit before 1-1-2022 as a result of the termination of a temporary contract or a dismissal, individual or collective, for economic, technical, organisational or production reasons, or a dismissal for any reason declared unfair.
  • The amount of unemployment benefit for those affected by ERTE will remain at 70% of the regulatory base until 31-5-2021 (it will not be reduced to 50% after the first 6 months).

EXEMPTIONS FROM SOCIAL SECURITY CONTRIBUTIONS

ERTEs due to impediment:

  • 100% if the company had less than 50 workers on 29 February
  • 90% if the company had more than 50 workers.

ERTEs due to limitation:

  • 100%, 90%, 85% and 80% from February to May 2021 respectively, if the company had less than 50 workers on 29 February.
  • 90%, 80%, 75% and 70% from February to May 2021 respectively, if the company had more than 50 workers.

Companies belonging to “ultra-protected” sectors:

  • 85% if the company had less than 50 workers on 29 February
  • 75% if the company had more than 50 workers.

The information contained in this note should not in itself be considered as specific advice on the matter under discussion, but only as a first approach to the subject matter, and it is therefore advisable that the recipients of this note obtain professional advice on their specific case before taking specific measures or actions.

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