The Government prohibits from this Saturday (and until the state of alarm ends) that companies execute any type of dismissal for coronavirus, which has paralyzed the economy. The companies will not be able to do it alleging causes of force majeure or economic, organizational, technical and production causes, and they will have to accept the Temporary Employment Regulation Files (ERTE). However, the Executive has not actually prohibited employers from terminating the contractual relationship with their employees, but has only process more expensive.

This Saturday the Official State Gazette (BOE) publishes the Royal Decree-Law 9/2020, which has been enacted by the Ministry of Labor led by Yolanda Díaz to put a stop to the dismissals related to the Covid-19 and thus avoid the loss of employment during the health alarm. However, labor lawyers already warn that in reality employers can continue to fire their workers if they see it necessary to maintain their activity, only that they will have to pay more for it.

In fact, Labor has annulled as an objective cause of dismissal all of the aforementioned, but has not established them as null and void or modified unfair dismissals, as is clear from the rule published in the BOE, so this route remains open , even if it’s more expensive for employers. Many experts remember that prohibiting dismissals is unconstitutional, which is why the Government has opted for the only thing left: penalize them considering all of them (those that take place in full alert) as inappropriate although losses, organizational, productive reasons or the loss of the activity are proven. Although ultimately it will be a judge who determines it.

Yolanda Díaz already warned this Friday, in the press conference after the extraordinary Council of Ministers that was held to give the green light to these measures and to the extension of the alarm status for another 15 days, once the approval of the Congress of Deputies. “It cannot be dismissed because we have arbitrated an exceptional mechanism with many public resources to facilitate our ERTE,” he said, making it clear that it was not necessary to “confuse the causes of the dismissals with the classification of the dismissals (appropriate, inappropriate, null)” , because that is the task of the judges. “If there are challenges for abuse or misuse, the courts will classify it a posteriori,” he said.

Regarding the cost to the company, the difference between an objective dismissal and an unfair dismissal is the compensation that must be paid to the worker. In the first case, 20 days per year worked are paid with a ceiling of 12 monthly payments, while in the second case you must pay 33 days per year worked, with a maximum of 24 monthly payments. Employers will, therefore, have to pay much more if in the end they fire their employees, since with the decision taken by the Government the only way is through unfair dismissal.

ENTREPRENEURS SAY THERE WILL BE MORE UNEMPLOYMENT

The Spanish Confederation of Business Organizations (CEOE) and the Spanish Confederation of Small and Medium Enterprises (Cepyme) they have already criticized these measures in a statement, because “when a large number of companies, especially SMEs and the self-employed, are struggling to avoid the closure in a context that is already announced of a global recession, we strongly reject that the Government tries to throw suspicions and mistrust of the business community “.

They claim that their will, above all else, is to sustain the economy and employment, and that is why they try to “avoid an even greater halt in business activity.” In his opinion, the measures adopted “are going to prevent laying the foundations for Spain’s necessary economic recovery”, and with them the Executive risks that there is a higher level of unemployment.

However, the unions, which had alerted that there could be up to 1 million layoffs in March, have positively valued the decisions of Pedro Sánchez’s cabinet. In a joint statement, UGT and CCOO have recalled that both the prohibition to dismiss during the health crisis and the exercise of a greater control in ERTE to guarantee the return to employment once this situation is over, they are measures that they have already proposed to the Government.

“These measures represent a step forward in the protection of working people, in very difficult times marked by the pandemic and the state of alarm that the country is experiencing,” they assured. And regarding the layoffs, they have stated that “no one could take advantage of this situation to dismiss”, since measures had already been agreed to prevent companies from using this formula during this crisis. “ERTE are the alternative to layoffs and companies must bet on them”.

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