The Government Plans to Extend Employment Benefits Til 2012 For Workers Affected by Downsizing

4 December 2009

This provision is included in the Bill for Urgent Employment Support Measures which is currently working its way through the Spanish Parliament.

With this measure the government hopes to allow, for the rest of the current term, the possibility of extending unemployment benefits for up to four months for workers who undergo a collective suspension of employment contracts and are finally laid off without having returned to work. That is, if the dismissal (individual or collective) goes into effect between March 8, 2009 and December 31, 2012, the workers will be able to benefit from this measure.

There are other additional noteworthy measures included in the aforementioned bill. Firstly, the decision to extend, until December 31, 2010, the coverage described in the preceding paragraph for a period of up to three months to workers who have exhausted their employment benefits due to a suspension of employment and who are then laid off at a later time without having worked enough time in the interim to generate further unemployment benefits.

And secondly, companies can take advantage of the one-year increase in exemption from payment of the Social Security contributions for common contingencies when they hire unemployed workers who are receiving unemployment benefits.

We will keep you informed of the final passing of the Act and its terms.

For further information please contact Javier Echeburúa: