01 April 2020

COVID-19: RDL 11/2020, further urgent complementary measures in the social and economic field

In view of the public emergency situation, the Government adds to those already published, the new Royal Decree-Law 11/2020 of 31 March, which adopts additional urgent measures in the social and economic field to deal with COVID-19 ("RDL 11/2020"). RDL 11/2020 is an extensive text structured in 3 Chapters, 54 Articles, 22 Additional Provisions, 5 Transitional Provisions, 13 Final Provisions and 4 annexes. In this regard, throughout this information note we will analyse the most relevant employment aspects that it regulates, after explaining its main pillars.

The first chapter is devoted to support measures for employees, consumers, families and vulnerable groups, including moratoriums or assistance in relation to the lease rent of the main dwelling and suspensions of eviction procedures, the possibility of terminating certain contracts without penalty for consumers and users, and the support measures for certain employees, companies and self-employed persons that we will develop next. On the other hand, the second chapter focuses on trying to sustain economic activity, with measures to support industrialization, flexibility in supply for the self-employed and companies, among others. Finally, the third chapter, under the heading of "other measures", reinforces, on the one hand, several of the measures adopted in Royal Decree Law 8/2020 ("RDL 8/2020"), such as those relating to the control of foreign investment or consumer protection in relation to electronic communications and, on the other hand, introduces other measures to increase the resistance of the Spanish financial system to possible market fluctuations.

In addition, it is important to note that the Twelfth Final Provision establishes the validity of the measures provided for in RDL 11/2020 until one month after the lifting of the alarm state, with the exception of those measures for which a specific period of time has been regulated, the duration of which shall be subject to the same.
Once the content regulated in RDL 11/2020 has been explained in detail, we will go on to detail the aspects introduced in employment matters: 

THE CONCEPT OF "EMPLOYMENT COMMITMENT"

RDL 8/2020 subordinated the application of extraordinary measures in employment matters to the maintenance of employment. In this regard, RDL 11/2020 regulates that this maintenance will be assessed based on the casuistry of the different sectors and the applicable employment regulations, as well as the specifics of those companies that present a high variability or seasonality of employment or a direct relationship with specific events or shows, as is the case, among others, in the field of performing arts, music, film and audiovisual.

On the other hand, in the case of temporary contracts, the commitment to maintain employment will not be deemed to have been breached in the event that the contract is terminated due to the expiry of the agreed time, or the performance of the work or service for which it was entered into, or in the event that the performance of the work or service constituting its subject matter cannot be carried out immediately.

In addition, in the Explanatory Memorandum III, Section 2, RDL 11/2020 establishes that the commitment to maintain employment will not be understood to have been breached when the employment contract is terminated due to disciplinary dismissal that is declared appropriate, or due to resignation, retirement, or total or absolute permanent disability of the employee.

EXTRAORDINARY ALLOWANCE FOR LACK OF ACTIVITY FOR PERSONS INTEGRATED IN THE SPECIAL SYSTEM OF HOUSEHOLD EMPLOYEES OF THE GENERAL SOCIAL SECURITY SYSTEM 

The new RDL 11/2020, with the aim of helping a particularly unprotected group, regulates a temporary unemployment benefit for domestic employees, compatible with maintaining part of their services. This subsidy may be requested both by employees whose employment relationship has been terminated (withdrawal by the employer) or for the cause of dismissal set forth in Article 49.1.k ET, and by those who have temporarily ceased to provide services, in whole or in part, in order to reduce the risk of contagion, for reasons beyond their control, in one or more homes and on account of the COVID-19 health crisis.

Accreditation of the causal event requires a responsible declaration, signed by the employer(s) who have dispensed with all or part of the services of the household employee, or, if applicable, the letter of communication of the termination of the employment relationship. 

EXCEPTIONAL UNEMPLOYMENT BENEFIT AT THE END OF A TEMPORARY CONTRACT 

Another group with a significant degree of vulnerability are temporary employees, for whom a special subsidy is also available, in the event that a fixed-term contract, including temporary, training and relief contracts, of at least two months' duration, has been terminated after the entry into force of Royal Decree 463/2020 declaring the State of Alarm, and they will not have the necessary contribution to access another benefit or subsidy. 

In addition, the incompatibility of this subsidy with the receipt of any minimum income, inclusion income, social wage or similar public aid is established.
As for the amount and duration, it will consist of a monthly allowance of 80% of the current IPREM, for one month, which may be extended if it is determined by a new Royal Decree-Law. 

COMPATIBILITY OF THE ALLOWANCE FOR THE CARE OF MINORS AFFECTED BY CANCER OR OTHER SERIOUS ILLNESSES AND UNEMPLOYMENT BENEFIT OR CESSATION OF ACTIVITY DURING THE STATE OF ALARM 

As for the allowance for the care of minors affected by cancer or other serious illnesses, which were being received by salaried employees on 14 March 2020, it will not be affected by the ERTE that has its cause as provided for in Articles 22 and 23 of RDL 8/2020 of 14 March.

In this sense, RDL 11/2020 establishes that the receipt of the aforementioned subsidy will be compatible with the receipt of the unemployment benefit that, as a result of the reduction of the working day, affected by a temporary employment regulation, may be entitled to receive. 

During the time that the State of Alarm remains, there will be no obligation to contribute, the period being considered as contributed for all purposes. 

TEMPORARY INCAPACITY BENEFIT FOR ESSENTIAL EMPLOYEES IN SITUATIONS OF TOTAL CONFINEMENT

RDL 11/2020 regulates in its twenty-first Additional Provision that, exceptionally and with effect from the beginning of the confinement situation, and by means of the corresponding discharge, this protection will be extended to those employees obliged to move from one locality to another and who are obliged to provide the essential services referred to in Royal Decree Law 10/2020, provided that:

• the confinement of the population where they have their domicile has been agreed and the employee has been expressly denied the possibility of moving by the competent authority;

• the employee cannot carry out his/her work telematically for reasons not attributable to the company for which he/she provides his/her services or him/herself; and

• the employee is not entitled to receive any other public benefit.

FUNDS FROM THE COLLECTION OF THE VOCATIONAL TRAINING QUOTA FOR EMPLOYMENT FOR THE YEAR 2020

It is established that, exceptionally and extraordinarily, given the economic impact of the measures approved to deal with the health crisis caused by COVID-19, the income derived from the vocational training contribution obtained in the financial year 2020 may be used to finance any of the benefits and actions of the unemployment protection system defined in Article 265 of the General Social Security Act, or to finance programs that foster the recruitment of unemployed persons or help them to regain employment.

SUPPORT MEASURES FOR THE SELF-EMPLOYED 

The Government has also approved, through RDL 11/2020, measures to help the self-employed in order to alleviate the consequences of the health crisis generated by COVID-19. Two measures have been approved: 

• Moratorium on social security contributions: companies and self-employed employees included in any Social Security scheme may request, provided they meet certain requirements to be established by Ministerial Order, a 6-month moratorium on the payment of Social Security contributions and on joint collection. The accrual period, in the case of companies, will be between April and June 2020, and in the case of salaried employees between May and July 2020, provided that the activities they carry out have not been suspended as a result of the State of Alarm. 

The companies must submit the application through the RED System, and they must be individualized applications for each contribution account code where the employees for whom the moratorium on the payment of their contributions is requested are registered. On the other hand, self-employed employees shall submit the application through the RED System or by the electronic means available.

Deadlines: applications must be submitted within the first 10 calendar days of the entry periods corresponding to the accrual periods. The granting of the moratorium shall be communicated within 3 months of the application. However, this notification shall be deemed to have been made when the moratorium is actually applied to the quota payments made from the time the application is submitted.

The contribution account codes for which the companies have obtained exemptions in the payment of the business contribution, as well as in the joint collection quotas, as a result of the procedures for the suspension of contracts and reduction of working hours due to force majeure, cannot benefit from this moratorium. 

The corresponding sanctions will be applied to those applications presented that contain false or incorrect data. Undue recognition of moratoriums will lead to an ex officio review of the act of recognition of the moratorium. In such cases, and without prejudice to the administrative or criminal liability that may correspond by law, the company, or the self-employed employee, shall apply to the quotas to which the moratorium of the corresponding surcharge and interests has been unduly applied. 

• Deferral of Social Security debts: companies and self-employed employees, provided they do not have another deferral in force, may request a deferral of their Social Security debts, the statutory period for payment of which will be between April and June 2020. In this case, RD 11/2020 sets the interest rate at 0.5% instead of that provided for in Article 23.5 of the Consolidated Text of the General Social Security Law, approved by Royal Decree Law 8/2015 of 30 October ("LGSS"). These requests for postponement must be made before the first 10 calendar days of the regulatory period for entry. 

AVAILABILITY OF PENSION SCHEMES IN THE EVENT OF UNEMPLOYMENT OR CESSATION OF ACTIVITY RESULTING FROM THE HEALTH CRISIS CAUSED BY COVID-19

During the period of six months from the entry into force of the Royal Decree declaring the State of Alarm, the members of the pension plans may, exceptionally, make their consolidated rights effective in the following cases: 

• be legally unemployed as a result of an ERTE due to the COVID-19;

• be the owner of establishments whose opening to the public has been suspended as a result of the declaration of the State of Alarm; and

• in the case of self-employed employees who have previously been integrated into a social security system as such and have ceased their activity as a result of the health crisis caused by the COVID-19.

It is established that the maximum amounts to be disposed of must not be higher than the salaries ceased to be received while the ERTE remains in force.

DEADLINES FOR ADMINISTRATIVE APPEALS 

Through the Eighth DA, the time limit for appeals is extended. The time limit for lodging administrative appeals or for initiating any other challenge, claim, conciliation, mediation and arbitration procedures that replace them is calculated in accordance with the provisions of the Laws, in any proceedings from which unfavourable or taxing effects may arise for the person concerned, shall be calculated from the working day following the date of completion of the declaration of the State of Alarm, regardless of the time that has elapsed since the notification of the administrative action that is the subject of appeal or challenge prior to the declaration of the State of Alarm. The above is without prejudice to the effectiveness and enforceability of the administrative act being appealed or challenged. 

MEASURES TO SPEED UP PROCEDURES

Once the declaration of the State of Alarm and its corresponding extensions have been left without effect, the Nineteenth DA regulates that, as soon as possible and in any case within a maximum period of 15 days, an Action Plan will be approved to speed up judicial activity in the social and contentious-administrative jurisdictions, as well as in the area of the Commercial Courts in order to contribute to the objective of rapid economic recovery.

EXTRAORDINARY MEASURES IN THE FIELD OF CONTRIBUTIONS AND UNEMPLOYMENT PROTECTION IN RELATION TO FORCE MAJEURE ERTES DUE TO COVID-19

RDL 11/2020 establishes that the extraordinary measures regarding contributions and protection due to unemployment provided for in Articles 24 and 25.1 1 to 5 of RDL 8/2020, will be applicable to those affected by the procedures for the suspension of contracts and reduction of working hours notified, authorised or initiated prior to the entry into force of RDL 8/2020, provided that they derive directly from COVID- 19.

Likewise, with regard to unemployment benefits received by permanent, discontinuous employees (Article 25.6 RDL 8/2020), they shall be applied to employees whose employment relationship was suspended prior to the date of entry into force of RDL 11/2020, provided that such suspension is a direct consequence of COVID-19.

APPLICATION OF THE ERTES TO THE COMPANIES IN INSOLVENCY PROCEEDINGS 

Likewise, measures are incorporated in the tenth Additional Provision that will be applicable to companies in insolvency proceedings that carry out procedures to suspend the work contract and reduce the workday due to force majeure and ETOP, provided that Articles 22 and 23 of RDL 8/2020 are complied with.

The regulations applicable to these procedures are those provided for in Royal Legislative Decree 2/2015, of 23 October, which approves the revised text of the Employees' Statute Law ("ET"), with the specialities provided for in Articles 22 to 28 and Sixth DA of RDL 11/2020, without the procedure of Article 64 of Law 22/2003, of 9 July, on Insolvency being applicable. 

In addition, the following specialities will be applicable to the processing and resolution of these procedures: 

• The applications or communications of the dossiers must be formulated by the bankrupt company with the authorization of the bankruptcy administration, or by the bankruptcy administration directly, according to the regime of intervention or suspension of patrimonial powers.

• The bankruptcy administration will be part of the consultation period in Article 23 of RDL 11/2020.

• The decision to apply the measures on the suspension of contracts or reduction of the working day, in the cases provided for in Article 23, must be authorised by the bankruptcy administration or adopted by it, according to the regime of intervention or suspension of patrimonial powers, in the event that no agreement is reached in this respect during the consultation period. 

• In any case, the application, resolution and measures applied must be immediately informed to the bankruptcy judge, by telematic means. 

• In the cases of section 1 of Article 47.1 paragraphs 10, 15 and 16 ET and Article 33.6 of Royal Decree 1483/2012, of 29 October, which approves the Regulations of the procedures for collective dismissal and the suspension of contracts and reduction of working hours, it will be the judge of the insolvency proceeding that will hear the challenges to which they refer. These objections will be dealt with by the procedure of the bankruptcy incident in employment matters and the ruling will be appealable in reversal.

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