Extraordinary aid for workers affected by company restructuring processes
Royal Decree 908/2013, of November 22, 2013, establishing special rules for the grant of extraordinary aid to workers affected by company restructuring processes, was recently published in the Official State Gazette. The rules aim to cater for emergency situations and situations of social and labor need in order to alleviate the social consequences deriving from such restructuring processes.
In order to meet this objective, it provides that Ministry of Employment and Social Security will be able to grant the different types of subsidy provided for in the Royal Decree, funded by the relevant budget programs, to workers affected by collective layoffs, objective layoffs on economic, technical, organizational and/or production-related grounds, as well as to workers whose employment contracts are terminated pursuant to the provisions of the Insolvency Law, provided that they have worked for the company or group of companies for a minimum of two years and are legally unemployed at the time the aid is granted.
In particular, the aid can be granted if the agreement reached during the consultation period of the collective layoff procedure includes an income plan formalized by means of a group insurance policy, if the employment relationship is terminated in accordance with the provisions of the Insolvency Law or if the company has been declared insolvent and has not paid the statutory severance for dismissal and, finally, if the contributory unemployment benefit entitlement has been used up in periods of temporary suspension of contracts or reduced working hours.
The practical application of this piece of legislation and, in particular, the budgetary provision made for the aid, will be determining factors in providing economic coverage to workers affected by company restructuring processes.
Garrigues Labor & Employment Department