The labor reform will reduce the average duration of indefinite contracts and will increase the number of layoffs

• CESAR URRUTIA

  @cesarurrutiasj

  MADRID

Updated Sunday, April 10, 2022-02:33

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The labor reform approved by Congress last December has entered into force in April with all its effects.

Once the transitory adaptation period has expired, the Spanish labor market already has a regulatory framework in place that aims to put an end to the precariousness of contracts, identified with temporary contracts.

The abuse of temporality has turned Spain, with the Administration as one of the main focuses, into an extreme case that is now taking a firm course towards the indefinite contract.

What this change will consist of when it is consolidated is what no expert dares to venture.

Does the transformation consolidate quality employment or is it mere statistics?

Is more employment generated?

Will there be more or fewer layoffs?

At the moment, the

.

But there is a nuance that, throughout this week, has come to the fore as the change in the labor market is underlined: indefinite does not mean forever.

Neither now nor before the reform, as highlighted by the economist

in his report Precariousness 2.0: indefinite contracts, but not eternal, published by Fedea in 2018 together with

.

The excess of temporality is a unanimously recognized problem in Spain, with a special impact on young people and women.

This was reflected in the demand of the European Commission when guiding the reform and the subsequent negotiation approved by all social agents, the Government and Congress.

The labor reform of 2012 was not repealed, but if the vice president and head of Labor

In this way, the periodic statistics of the labor market are already beginning to mark the trend that will be accentuated in the coming months.

In March, almost

, a proportion that before last December was practically impossible due to the entrenched nature of temporary employment.

samples?

Oscillations of hundreds of thousands of registrations and cancellations in Social Security between the last and first days of the month (around 300,000 on August 31) or five-day contracts interrupted at the weekend to avoid paying contributions.

Over the last decade, the relationship between both hiring modalities has been

.

Only from last February the storms fell from 86% to drill in March the level of 70%.

With these numbers, the 513,677 indefinite contracts signed in March led the Secretary of State for Social Security

" thanks to the impact of the labor reform, due to the repercussions "in terms macro for the economy and personal terms for the people.

His Labor colleague, the Secretary of State,

, underpinned the approach by stressing that Spanish workers are experiencing a "very forceful recovery of the principle of stability in employment and the fight against precariousness".

But the end of precariousness is far from being a guarantee of labor reform.

According to the Fedea study, with the previous legislation,

" because they were only valid for one year and dismissal was the predominant way of terminating the employment relationship.

In other words, indefinite hiring was far from considering a stable employment project for four out of 10 workers.

Nor is it that, in contrast to the precariousness identified with temporary contracts, it constituted a clear job creation tool.

The study indicated that the impact of the nearly two million permanent contracts signed each year was "relatively low" in the net changes in permanent employment.

"Seen in another way and as an example, in the last four years of economic expansion (2015 to 2018)

says the report.

At the time of the study, there were numerous bonuses for permanent contracts and in the case of entrepreneurs, there was no compensation in the first year.

In the new stage, an

expected .

By absorbing large pools of temporary contracts such as

, which it transforms into discontinuous permanent indefinite contracts, a paradox will occur.

There will be more permanent contracts than ever but they will probably also last less than ever.

"A priori, it is what could be expected,

, confirms Felgueroso, who clarifies that he does not have the updated data on the average validity of the contracts.

Rotation in the first two years

His colleague, the economist Marcel Jansen explains that although the labor framework has changed and promotes the transfer of temporary to fixed relationships, "the reasonable thing" is to think that

.

Not only that, but in the first years of the contract there will also be more layoffs.

"There will be more turnover," he says.

Jansen recalls in this regard that the job destruction rate in this type of contract reached 40% in the first year and then went down.

If the contract exceeded three years, the survival rate in the indefinite relationship grew considerably.

what has to be done is to prevent excessive rotation in the first and second year due to the fact that in that period firing is cheaper".

Thus, that the labor reform is already transforming the labor market is a fact.

But that the generalization of the indefinite contract will produce stability at work and put an end to precariousness, not so much.

The Government already practically considers both things accomplished, but companies and unions ask for prudence, as do the economists, who consider that it will not be possible to take a rigorous balance of the changes for another two years.

"I am one of those who deny that the transformation is merely statistical: for a worker,

; he is more protected and as his employment relationship lasts, productivity can benefit, says Jansen, while warning on the possibilities of indefinite insertion of groups such as young people without training or long-term unemployed "Temporary contracts were useful as a bridge to more stable employment, now we have to prevent their insertion from being made difficult after the reform," he says.

That the precariousness trap has disappeared in a week after being the great problem of the Spanish labor market for years is so surprising that labor experts doubt it is true.

This contract is the star of the reform and will be used to carry out seasonal work or work linked to seasonal productive activities.

It is the tool with which it is intended to cover business needs for temporary jobs, even for a week or less, or those that until last March were being carried out under the work and service modality.

In March, discontinuous fixed contracts

, being the category that grew the most (407%) but the one that registered the least contracts compared to others such as full-time or part-time indefinite contracts.

Of course, together with the eventual ones due to production circumstances, the work and service contracts were the main source of power for the contracts converted into indefinite ones, mostly in the category of discontinuous permanent contracts.

This transfer is the one that both the labor offices and the Labor inspectors identify as the one with the greatest risk or, even,

.

The laxity in its regulation, closely linked to sectoral collective agreements on issues such as calls to activity or the circumstances of the dismissal promises litigation.

And the possibilities of being fertile ground for temporary abuses as well.

Is it an empty space of the labor reform to make room for the precariousness that it was precisely trying to combat?

, president of the Union of Labor and Social Security Inspectors.

Ercoreca points out that it is in this modality that the ultra-short contracts that ended on a Friday and began the following Monday or the hundreds of thousands of casualties on the last days of each month that with the same automation were registered on day 1 will fit.

In this sense, the stability of an indefinite employment relationship does not mean the end of precariousness due to the worker's obligation to always be available for company calls, even if they occur from year to year for such short periods that they prevent sufficient level of income, reconcile or even generate minimum unemployment rights for contributing more than 360 days.

"The discontinuous permanent workers will appear as permanent full-time workers -260,822 last March- even if they end up working only two months a year,

", says Ercoreca.

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