National budget 2021 – New developments in the area of employment

matters published in the Law 11/2020, dated the 30th of December on the National Budget, which came into force on the 1st of January, 2021:

  • Contribution bases 2021
    • With regard to the minimum contribution bases, according to the professional categories and the contribution groups, from the 1st of January, 2021 and with regard to those in force on the 31st of December, the percentage increase for these will be the same as that established for the guaranteed minimum wage. (The guaranteed minimum wage of 2020 has now been extended for 2021 seeing as the guaranteed minimum wage for 2021 has not been approved yet).
    • The maximum contribution tax bases are the same as they were in 2020, that is to say, 4070.10 euros monthly or 135.67 euros a day.
  • Types of contribution 2021
    • In turn; there is no increase in the rates for 2021 with regard to 2020.
  • Moratoriums in social security contributions
    • The companies and the self-employed workers that are up-to-date with their Social Security obligations and do not have any other deferments in force, can request the moratorium in the payment of the Social Security contributions and for joint collection items that are payable between December, 2020 and February, 2021, in the case of companies and between January and March 2021 in the case of self-employed workers. 0.5% interest will be applied.
  • Contract for dual-sector university training 
    • From the 1st of January, 2021 and for an indefinite period the contract for dual-sector university training has been included in article 11 of the Workers’ Statute, which will be formalized within in the context of the educational cooperation agreements signed between the universities and the collaborating entities. The objective of this is to provide university students with professional skills through a system of alternating paid work activities in a company with their university education.
    • The regulation provides for the regulatory development of the teaching system, the characteristics of the training, the matters related to the financing of the training activity and the payment of the worker hired, which will be established according to the hours worked and pursuant to the terms established in the collective agreement. In no case will it be less than the guaranteed minimum wage. The Social Security protective action for the workers hired for the dual-sector university training will include coverage for all the contingencies that can be protected and benefits, including unemployment and the Wage Guarantee Fund coverage.
  • Compensation provided by the Wage Guarantee Fund (FOGASA)
    • Modifications are made to the Workers’ Statute in relation to the FOGASA. It is now in charge of the compensation granted by a decision, order, accord and satisfaction or administrative decision resulting from a dismissal or the termination of an employment contract pursuant to articles 50, 51, 52, 40.1 and 41.3 of this law, and the termination of contracts pursuant to articles 181 and 182 of the Royal Legislative Decree 1/2020, dated the 5th of May, through which the consolidated text of the Bankruptcy Law is approved, along with the compensation for the termination of temporary contracts or those lasting a certain amount of time in the cases established by law. In all cases with the maximum limit of one year and 9 months in the case of article 41.3 of the Workers’ Statute, the daily wage cannot be more than double the guaranteed minimum wage, including the proportional part of the bonus payments.
  • Legal rate of interest and interest in arrears
    • The legal rate of interest is set at 3% and the interest in arrears is 3.75%.
    • In 2021 the amounts of the multiplier for the public income index (IPREM) are set at: 18.83€ (daily amount), 564.90€ (monthly amount) and 6778.80€ (annual amount).
  • Retirement and work
    • The special solidarity contribution for individuals, who want to draw on their pension and carry on working, will go up to 9% on the contribution base for common contingencies from the 1st of January, 2020, which with regard to employed workers is 7% for the employers and 2% for the worker. As for self-employed workers it will be 9% on the common contingencies contribution base at their sole expense.
  • Permanent seasonal employment contracts in the tourism, retail and hospitality sectors that are associated with tourism. 
    • As a way to favour the extension of the period of activity of workers that have permanent seasonal employment contracts in the tourism, retail and hospitality sectors associated with tourism, from the 1st of January, 2021, companies that are involved in these sectors, whose economic activities take place in the months of February, March and November of each year and register and/or keep workers with the permanent seasonal employment contracts registered in the Social Security system during these months, can make the most of a 50% allowance in these months in the employers’ contributions to the Social Security for common contingencies, unemployment, FOGASA and Vocational Training associated with these workers.
  • Allowance for changing job positions due to work-related risks during pregnancy or breast feeding 
    • The 50% allowance in the employers’ contributions for common contingencies remains the same, in the event that the job position has to be changed due to work-related risks during pregnancy or breastfeeding and also occupational diseases.
  • Vocational training credit for employment 
    • Companies that pay contributions for vocational training contingencies will have training credit, according to the number of workers. Companies that open new workplaces and companies that are set up in 2021 can benefit from this, whenever new workers are hired.
    • Companies that grant their employees individual training leave in 2021 get a bonus credit for extra training.
  • Discontinuation of the bonus for a low accident rate
    • The use of the reduction in contributions system for professional contingencies in companies where there has been a significant drop in the number of occupational accidents is expected to be discontinued.

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