How Spain will allow workers to keep claiming unemployment benefits
Following an agreement with trade unions the Spanish government is seeking to reform unemployment benefits, including paying unemployed people more and allowing some workers who find a job to keep claiming benefits.
Spain’s Ministry of Labour signed an agreement with trade union leaders on Wednesday to reform unemployment benefits, known as el paro in Spain.
This comes amid ongoing government attempts to reform unemployment protections in the country. The first proposal was voted down in January in Spain’s Congress of Deputies by right-wing opposition parties the Partido Popular and Vox, as well as far-left, former government coalition member Podemos.
Political pundits in the Spanish press believe this second attempt, especially with the new reforms agreed with unions, will be enough to get Podemos on board and therefore through Congress.
The agreement was made without the input of employers’ groups, however. Among many new measures the deal increases the amount of unemployment payment available, broadens the groups that benefit it and even makes it possible to claim unemployment benefits while in work for a short period.
"This is not a little payment, this is a right,” said Spain’s Labour Minister, Yolanda Díaz, at the signing ceremony together with the general secretaries of Spain’s two major trade unions, the CCOO and UGT. The reform, Díaz stated, is intended to help "the lives of those who are having the hardest time" in Spanish society. The reforms were a requirement for Spain to receive its next tranche of European funds.
The key reforms
Benefit increase
Unemployment benefits are being increased. Like with other types of state aid, it is calculated as a percentage of the public indicator of multiple effects income (IPREM).
The draft bill raises the amount to 95 percent of the IPREM in the first six months (around €570 per month) and to 90 percent (€540 per month) in the following six months and, finally, maintains the current 80 percent (€480 per month) or the period thereafter.
Another important change is that the benefit will be the same whether the applicant was previously in part-time or full-time work, something intended to benefit women because the majority in part-time work in Spain are women.
Benefits become compatible with employment
Perhaps the most eye-catching aspect of the draft reform is that it is now technically possible to be both claiming el paro and be employed if you earn less than €1,350 gross per month.
By making the two compatible, it will be possible to receive a salary and unemployment benefit for a maximum of 180 days (6 months), regardless of whether the employment is full-time or part-time. In practice, this will be only available to those who have previously worked and paid taxes for three and half years.
The aim of the work and benefits compatibility, sources from the Labour Ministry say, is to encourage workers' reintroduction into the labour market.
The amount of unemployment aid will depend on the length of the working day and also on how long the benefit has been received, so that the longer you have been receiving it, the lower the amount, which is also calculated as a percentage of the IPREM. It will range from €480 a month to €180.
Though some details still need to be confirmed, according to the reform, it will not be possible to combine work and unemployment benefits before April 2025.
The benefit will be lost if the gross monthly salary is higher than 225 percent of the IPREM, €16,200 gross per year in 12 payments, or €1,350 per month.
Speeding up processes
The reforms also try to speed up the procedures when claiming unemployment benefits.
The Ministry wants to get rid of the one-month waiting period after unemployment benefits run out, but will also tighten up the deadlines: if you apply for benefit six months after the benefit has run out, your application will now be rejected.
Widening the scope
The reform proposal also extends the groups of people who can access unemployment benefits. It will also now be paid to those without dependents who have paid social security contributions for less than six months, and to temporary workers in the agricultural sector.
Equally, whereas before it was necessary to prove a lack of income in order to be eligible, this required evidence of both personal and family unit income, with this reform only one will be required.
Workers over 52
The agreement also maintains the retirement contribution for recipients over 52 years of age at 125 percent of the minimum base in force at any given time.
Comments
See Also
Spain’s Ministry of Labour signed an agreement with trade union leaders on Wednesday to reform unemployment benefits, known as el paro in Spain.
This comes amid ongoing government attempts to reform unemployment protections in the country. The first proposal was voted down in January in Spain’s Congress of Deputies by right-wing opposition parties the Partido Popular and Vox, as well as far-left, former government coalition member Podemos.
Political pundits in the Spanish press believe this second attempt, especially with the new reforms agreed with unions, will be enough to get Podemos on board and therefore through Congress.
The agreement was made without the input of employers’ groups, however. Among many new measures the deal increases the amount of unemployment payment available, broadens the groups that benefit it and even makes it possible to claim unemployment benefits while in work for a short period.
"This is not a little payment, this is a right,” said Spain’s Labour Minister, Yolanda Díaz, at the signing ceremony together with the general secretaries of Spain’s two major trade unions, the CCOO and UGT. The reform, Díaz stated, is intended to help "the lives of those who are having the hardest time" in Spanish society. The reforms were a requirement for Spain to receive its next tranche of European funds.
The key reforms
Benefit increase
Unemployment benefits are being increased. Like with other types of state aid, it is calculated as a percentage of the public indicator of multiple effects income (IPREM).
The draft bill raises the amount to 95 percent of the IPREM in the first six months (around €570 per month) and to 90 percent (€540 per month) in the following six months and, finally, maintains the current 80 percent (€480 per month) or the period thereafter.
Another important change is that the benefit will be the same whether the applicant was previously in part-time or full-time work, something intended to benefit women because the majority in part-time work in Spain are women.
Benefits become compatible with employment
Perhaps the most eye-catching aspect of the draft reform is that it is now technically possible to be both claiming el paro and be employed if you earn less than €1,350 gross per month.
By making the two compatible, it will be possible to receive a salary and unemployment benefit for a maximum of 180 days (6 months), regardless of whether the employment is full-time or part-time. In practice, this will be only available to those who have previously worked and paid taxes for three and half years.
The aim of the work and benefits compatibility, sources from the Labour Ministry say, is to encourage workers' reintroduction into the labour market.
The amount of unemployment aid will depend on the length of the working day and also on how long the benefit has been received, so that the longer you have been receiving it, the lower the amount, which is also calculated as a percentage of the IPREM. It will range from €480 a month to €180.
Though some details still need to be confirmed, according to the reform, it will not be possible to combine work and unemployment benefits before April 2025.
The benefit will be lost if the gross monthly salary is higher than 225 percent of the IPREM, €16,200 gross per year in 12 payments, or €1,350 per month.
Speeding up processes
The reforms also try to speed up the procedures when claiming unemployment benefits.
The Ministry wants to get rid of the one-month waiting period after unemployment benefits run out, but will also tighten up the deadlines: if you apply for benefit six months after the benefit has run out, your application will now be rejected.
Widening the scope
The reform proposal also extends the groups of people who can access unemployment benefits. It will also now be paid to those without dependents who have paid social security contributions for less than six months, and to temporary workers in the agricultural sector.
Equally, whereas before it was necessary to prove a lack of income in order to be eligible, this required evidence of both personal and family unit income, with this reform only one will be required.
Workers over 52
The agreement also maintains the retirement contribution for recipients over 52 years of age at 125 percent of the minimum base in force at any given time.
Join the conversation in our comments section below. Share your own views and experience and if you have a question or suggestion for our journalists then email us at [email protected].
Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.
Please log in here to leave a comment.