The Government intends to approve this Thursday in its extraordinary Council of Ministers the fifth extension of the covid ertes. The agreement extends the aid for these files until September 30, 2021, that is to say, it covers the entire summer campaign.
The conditions of the agreement maintain special coverage for a list of specific sectors and introduce special incentives for those companies that can remove their workers from the state. At the level of benefits for workers, the same conditions are extended, with the same amount of pay and limitations on dismissal. Some 580,000 people are currently in Spain on a suspension file and these are the keys to the pact reached between the Executive, CEOE, Cepyme, CCOO and UGT to give them coverage.
1. What companies can benefit from the covid ertes?
The scheme outlined by the Government is maintained and distinguishes three types of ertes endowed with public resources. On the one hand, the ‘ suspension ertes ‘. These are the files that any company that is forced to close by a government decision can turn to.
Either due to a temporary outbreak, such as a bar located in a neighborhood in which a rebound in covid infections has been detected and for which the regional government on duty has temporarily decreed the closure. Or because of a closure decreed for a long time, as would be the case of nightlife, which has been banned for months.
The other type of erte authorized by the Executive is the ‘ erte due to activity limitation ‘. This protects those companies that are affected by specific limitations in their production, even though they may continue to operate. An example would be a theater that has limited capacity for health reasons and therefore has limited activity.
And the third part of the agreement is for those sectors most affected by the covid crisis and are considered ‘ ultra- protected ‘. This refers to a specific list of activities defined by CNAE (national classification of economic activities). These are the ones that the Government has considered most affected by the pandemic. Here the agreement reached between the parties introduces new features, as it adds some sectors to the list.
2. What companies are on the list of the most affected?
This is the list of sectors that the Government considers to have “a high rate of coverage due to temporary employment regulation files and a low rate of recovery of activity.” Three sectors have been added to this list with respect to the last extension: ‘Manufacture of other clothing and accessories’, ‘Wholesale of coffee, tea, cocoa and spices’ and ‘Photography activities’. And five come out of it: ‘Graphic arts and related services’,’ Manufacture of optical instruments and photographic equipment ‘,’ Retail trade of computers, peripheral equipment and software ‘,’ Space transport ‘and’ Rental of means of navigation ‘.
Ertes – Ultra-protected sectors
3. If a company is not on the list of sectors most affected, does it have access to aid?
For those companies that are not on that list of CNAEs, the Government has also opened the possibility of availing themselves of an erte by force majeure as long as they can prove that their activity depends on a company that is on said list. To access these grants, they must be able to prove that 50% or more of their turnover depends on a firm in erte by sectors.
4. How much is the aid for companies?
Erte companies can stop paying part of their workers’ Social Security contributions. The amount of the same will depend on the type of erte and the size of the company. In the case of impediments due to disability (companies forced to close), the exemptions are 100% for firms with fewer than 50 employees and 95% for those with more than 50 employees. Percentages that are maintained from June to September.
For the rest of the sectors, those of limitation and those of ‘ultra-protected’ sectors, the exemptions vary depending on the size of the company and whether or not they have active workers. The following table summarizes the exemptions.