Latest employment news of interest

We analyse the latest labour news published recently.

Below is some interesting information on the latest developments in labour law:

Possibility of deferral of the next social security contributions

Companies and self-employed workers may request a moratorium on the payment of contributions due between December 2020 and February 2021 -for companies- and between January and March 2021 -for self-employed workers- applying a general interest rate of 0.5%.

The repayment period is four months for each monthly payment requested, without exceeding twelve monthly payments. The first payment will be made from the month following the month in which the decision is taken.

The requirements to be met in order to be granted are as follows:

• Be up to date with the payment of Social Security contributions.
• And not have another deferment in force.

Applications must be made through the Electronic Headquarters before the end of the first ten calendar days of each of the payment periods.

Refund of all bonuses in case of non-compliance with the employment safeguard clause

Last December, the Directorate General of the Labour and Social Security Inspectorate (DGT) published an informative note on the refund of exempted contributions due to non-compliance with the commitment to maintain employment provided for in DA 6 of Royal Decree Law 8/2020.

In recent months, this State Agency had been receiving recurrent queries on the scope and interpretation to be given to section 5 of Additional Provision Six of Royal Decree-Law 8/2020, of 17 March (LA LEY 3655/2020), on extraordinary urgent measures to address the economic and social impact of COVID-19, the literal wording of which is transcribed below: “5. Companies that fail to comply with this commitment (maintenance of employment for a period of six months from the date of resumption of activity) must repay the full amount of the contributions they were exempted from paying, with the corresponding surcharge and interest for late payment, as established in the rules on Social Security collection, following proceedings by the Labour and Social Security Inspectorate to accredit the non-compliance and determine the amounts to be repaid”.

With this wording, if a company had processed an ERTE derived from the coronavirus and a contribution exemption had been applied, it was obliged to maintain the level of employment for six months and the consequence of failing to comply with this commitment was the return of these exemptions; however, the law did not clarify (and there was clear ambiguity) whether it was appropriate to return all the reductions applied in the company or only those related to the worker who was in breach of this precept with his or her termination.

Well, in the informative note issued for this purpose, the Directorate General of Labour (DGT) and the General Treasury of Social Security and the Labour Inspectorate have considered that non-compliance entails the return of all the exemptions applied by the company, regardless of the number of workers affected by the non-compliance with maintaining employment.

In its reply, the Directorate-General for Labour concludes that, on the basis of the wording of paragraph 5 of the sixth additional provision and in accordance with the interpretative guidelines of Article 3(1) of the Civil Code (LA LEYE), the company’s failure to comply with the obligation to maintain the employment.1 of the Civil Code (LA LEY 1/1889), and with regard to the spirit and purpose of the legal provision, whether or not one agrees with the strictness of the measure, it seems that it was the clear intention of the legislator to link the contribution benefits applicable in relation to temporary redundancy plans to the objective of maintaining employment in the company benefiting from them.

Tax deferral for the first quarter

As in the previous year, access to tax deferrals for self-assessments due between 1 and 30 April 2021 has been facilitated.

This deferral may be requested for up to a total of six months, with no interest on late payment for the first three months. In addition, the Treasury will allow the possibility of deferring debts of up to 30,000 euros automatically and without guarantee to be applicable to Personal Income Tax (IRPF) and payments on account, to payments in instalments of Corporation Tax and to VAT. If the amount of these debts, plus the amount already deferred, exceeds 30,000 euros, deferral may be requested up to the total limit of that sum.

Finally, both companies and self-employed professionals with a turnover of less than 6,010,121.04 euros in 2020 will be eligible for this deferral.

Increase in paternity leave to 16 weeks

As of 1 January 2021, paternity leave will be 16 weeks (the same length as maternity leave), of which the first six weeks must be taken after childbirth.

The parent may choose to take the rest of the paternity leave either consecutively or in weekly periods until the newborn child is 12 months old.

Likewise, and after agreement with the company, the rest of the paternity leave may be taken full time or part time.

It should be remembered that this leave is currently known as childbirth and childcare allowance for both parents and is exempt from taxation.

Bonus and permanence in the company

A Supreme Court ruling [SC 22-10-2020] has declared valid a clause that conditioned the payment of a variable remuneration (bonus) on the employee remaining in the company until the end of the financial year, the date on which the bonus accrual period ended.

In the event of termination due to death, retirement or permanent disability, the clause indicated that the bonus would be paid on a pro rata basis according to the number of days of employment.

Therefore, and always by means of a clause drafted for this purpose, it is presumed that an employee is not entitled to the payment of the agreed variable remuneration if he/she voluntarily leaves before the end of the year (not even to the proportional part of the bonus accrued up to the day of resignation).

However, when the cause of the termination of the employment relationship is not attributable to the employee, the situation changes. Thus, in cases of fair disciplinary dismissal or dismissal declared unfair or dismissal for objective reasons, the bonus accrued up to the last day worked must be paid.

In these cases, the use of a clause such as the one indicated above would be null and void, as the payment would be at the discretion of one of the two parties. In other words, as it is the company that decides to dismiss the worker and, according to the clause, this means saving the variable remuneration, it is considered that this clause is not valid in cases of dismissal.

The Labour Management department of AddVANTE remains at your disposal for further information or to resolve any queries that may arise in relation to this article.