Pablo Hernández de Cos , Governor of the Bank of Spain, has agreed today with companies and unions that it will be necessary to extend the guarantee schemes and ERTE beyond September 30, but at the same time he has addressed the Minister of Labor Yolanda Díaz to expressly ask her not to withdraw the capacity of companies to make adjustments that allow them to survive, a capacity granted by labor legislation that Díaz herself has indicated she wants to repeal.

Hernández de Cos and Díaz have coincided in the presentation of the annual report of the Economic and Social Council (CES) together with representatives of social agents such as Unai Sordo (CCOO) or Rosa Santos (CEOE) and Pedro Fernández Alén (Cepyme). The governor of the supervisory body has recalled the severity of the crisis caused by the coronavirus, warning that the recovery may not be intense enough to avoid "structural" damage to the economy. In this regard, he praised the measures taken so far and stressed that the current stage of the crisis is much more difficult to manage.

"We must be open to extend the guarantee programs and the ERTE if necessary," he said, referring to the second extension of the schemes that demand employers and unions. "But this support must be combined with ensuring the correct functioning of the different labor flexibility mechanisms available to companies, whose function is especially useful in these circumstances to efficiently carry out the adjustments derived from the crisis."

For the governor, the mechanisms of the labor reform in the hands of the companies, accompanied by active employment policies will be necessary so that the employees affected by restructuring since this fall will find a job as soon as possible because it does not make sense to maintain the support to businesses that the coronavirus crisis has made unviable.

The direct allusion to the labor reform that Díaz has promised to repeal and that the unions consider should be started in September in a "postponable" manner, has not been answered by the Minister of Labor, who, however, did call for "not being afraid" to extend the Temporary Employment Regulation (ERTE) records beyond September for as long as "necessary", since "there would be no point in dropping the system" if necessary after the high investment effort.

The lines of guarantees and ERTE in support of companies and workers since March have been keeping the productive fabric alive by saving millions of jobs and hundreds of thousands of companies. But at the same time they have a huge cost to the state coffers that the ministries of Economy and Social Security keep a close eye on. For Work, only the benefits of the ERTE have already eaten more than a third of the budget of the body that pays them, the SEPE, and which also has to face obligations with the rest of the unemployed workers . For Social Security, aid to self-employed workers and companies has led to a deficit of more than 2,000 million euros, when just a year ago the situation of the organization was the opposite.

Díaz has defended as a great success having included in the latest extension of the ERTE the prevention of outbreaks of the epidemic, a measure that he considers "effective" given the utility registered in the cities and counties that are suffering these outbreaks of contagion.

"I say this with caution, in case this tool is necessary, I want to give you a message of reassurance," he said, since "after such a large public investment effort, there would be no point in dropping the system if this were necessary." Díaz has stated in a message addressed to businessmen and unions but also to other members of the government, such as Nadia Calviño or José Luis Escrivá.

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  • Yolanda Diaz
  • Social Security
  • José Luis Escrivá
  • Nadia Calviño

EmploymentBusinessmen and unions again reject the Government's offer to extend the ERTE to one week of their expiration

LaborEmployers and unions see a new extension of ERTE in September as inevitable to protect workers and companies

300,000 jobs Managers warn that without further support measures 52,000 companies will turn their ERTEs into layoffs by the end of the year

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