Brief summary on regulations approved by Spanish government (Real Decretos) during State of Alert to face Covid-19. Includes mentions on ERTE procedures (description of this and Social Security contributions) and changes introduced in rental contracts and evictions.

Urgent Measures

To face the difficulties of Covid-19 pandemic, Spanish government has approved several urgent regulatory measures (“Real Decreto Ley”).

Such measures are mainly focused in self-isolating population, property rental rights, taxes and Company´s allowances to minimize the impact of the negative result of the pandemic.

Following the last point, Spanish government has declared that Coronavirus falls within the definition of a “force majeure event”, therefore collective suspension of employment contracts and reduction of working hours may be granted by the labour authority under this basis.

The abovementioned procedure is named ERTE (“Expediente de Regulación Temporal de Empleo”), it allows the affected employees to benefit from the unemployment allowances for the period of time the State of Alert called by the government lasts.

The ERTE application shall be filed before the labour authorities. Information about the employees that will be affected by this measure will also have to be shared with the labour authorities.

Companies interested on forwarding this procedure shall bear in mind that employees included in this may not be dismissed by objective reasons within the following six months from the date they are reincorporated in the Company.

Affected employees may receive the 70% of their salary from SEPE up to a maximum depending on various scenarios (such as parenthood, disabilities,…).

This procedure is applicable for any Company affected directly by the call of the State of Alert, no matter the size, sector or number of employees.

The request must be filed before the Spanish labour authorities and, within the period of 5 working days. It shall also be communicated within this period of time the Company´s decision to implement this to the affected employees, as well as to provide the required information to the SEPE so they may benefit from the unemployment allowances.

It is also in the Company´s interest that rules approved by government to face the Covid-19 measures also remove the company´s obligations to forward each affected employee´s Social Security contributions for those Companies with less than 50 employees and reduces the amount to be paid by the Company to the 25% of the total.

Once the procedure has been filed, the Spanish Labour authorities will review the request within 5 working days from the date of presentation.

Spanish government has also introduced several urgent measures in property and rents, specially focused in supporting tenants.

  • The eviction of properties for tenants considered to be in a vulnerable situation and do not have the possibility to access another property.
  • Lease contracts in force may be automatically extended in the case of habitual residences.
  • Deferral or cancellation of the lease payments. This will depend on the consideration of the landlord as big or small landlord, if it is a Company or a Public Body. In this scenario (and if an agreement between landlord and tenant has not been reached) a reduction of the 50% of the rental payment during the State of Alert and a deferral on the payment of this for up to four months.