Labour reforms make firing Spanish workers cheap. But it’s still a golden hand-shake for their bosses.
It’s yet another case of one rule for the many and another for the lucky few.
Spain’s right-wing government recently passed changes to labour laws that will make it much easier and cheaper for bosses to fire their workers.
The new rules, which are currently going through parliamentary approval, will see severance pay for new open-ended contracts cut to 33 days from 45 days for every year worked and big cuts to the maximum level of pay-outs, to 24 months’ pay, from 42 months previously.
What’s more if an employer’s revenues have been falling for at least nine-month period they will be able to pay staff the lower 20 days’ severance pay per year worked, and a maximum of a year’s salary.
Companies in difficulty will also be able to opt out of colletive bargaining agreements and alter working conditons by, for example, reducing wages or changing schedules.
Well that’s the picture for the 99%.
While Spain’s 23% unemployment queue has never been closer for workers who have to get by on an average of around Euros 1,000 a month net, the millionaires at the top echelons of Spain’s largest companies are very comfortably continuing their bubble-wrapped existence.
A significant number of CEOs in the Ibex 35 stock market index of biggest capitalised corporations have several years of guaranteed salary in the event of dismissal or even if they decide to leave the company voluntarily, provided they claim the functions for which they were hired have been altered, according to lainformacion.com, a Spanish finance title.
It’s the banks, authors of Spain’s housing debt and speculation fuelled bust, that remain the most generous in their golden-handshakes.
And Santander, the country’s and Europe’s largest bank by stock market capitalisation, remains at the top of the cream-for-fat-cats-come-what-may league.
A decade ago Angel Corcostegui, the then CEO walked away with a settlement of Euros 108 million. In January, as if just to prove that for the world of finance nothing has changed, Francisco Luzon, number three at the bank, left the organization with an accumulated pension fund of Euros 56 million, plus about Euros 9 million in extras.
At Banco Sabadell, no less than 24 executives have untouchable compensation packages, while it’s the same story for 13 high flyers at BBVA. Contractual indemnity clauses are also extended to 43 members of BBVA’s lower management, and in some cases the protections stand even if the person resigns.