Law 39/2010 of 22 December on the 2011
State budget (“Law 39/2010”) was published on 23 December 2010 in the
Spanish Official Gazette.
The objectives of Law 39/2010 and the
soon-to-be enacted Law on a Sustainable Economy are to establish the
basis for economic recovery and to change the economic growth model in
Spain. Moreover, this law aims to continue to reduce Spain’s public
deficit, which began with the approval of Royal Decree Law 8/2010 of 20
May on extraordinary measures to reduce the public deficit. Below is a
summary of the most important provisions introduced by Law 39/2010 from
a labour and social security standpoint.
1. PUBLIC PENSION SYSTEM
Title IV of Law 39/2010 freezes public
pensions at 2010 levels. This measure follows the government’s
undertaking to reduce the public deficit and restructure public finances
in the medium term.
1.1. Freezing public
sector pensions
As stated, article 39 of Law 39/2010
maintains public sector pensions at 2010 levels.
1.2. Maximum annual
state pension for 2011
In line with Chapter II of Law 26/2009,
the maximum state pension in 2011 will be EUR 34,526.80. This is the
same figure as in 2010, following the government’s undertaking to
sustain public spending.
1.3. Maximum monthly
state pension for 2011
Chapter II of Law 39/2010 establishes
that the maximum monthly state pension in 2011 will be the same as in
2010, which was EUR 2,466.20, assuming that the pension is spread over
14 payments during the year (including extraordinary payments). If a
pensioner receives fewer or more payments, the monthly amount must be
adjusted so that the annual maximum of EUR 34,526.80 is not exceeded.
1.4. Non-contributory
state pensions
According to Chapter IV of Law 39/2010,
the maximum annual state non-contributory pension for retirement and
disability is EUR 4,803.40. In addition, every pensioner who is not a
homeowner and therefore rents his or her dwelling will receive an annual
supplement of EUR 525 in 2011. Where various members of a family receive
a state non-contributory pension, only the lessee may receive the
supplement. If there is more than one lessee, only the first may receive
it.
1.5. Supplement to
ensure the minimum state and public sector pension
Chapter III of Law 39/2010 lays down
that pensioners whose total income in 2011 does not exceed EUR 6,923.90,
will be entitled to receive a supplement to ensure that they receive the
minimum state and public sector pension.
1.6. Pensions under
the former mandatory insurance for the elderly and disabled
Chapter IV sets forth that the pension
entitlement under the former mandatory insurance for the elderly and
disabled is set at EUR 5,313 per year as from 1 January 2011, provided
that the pensioner is not receiving any other state pension.
2. SOCIAL SECURITY BENEFITS
According to the first additional
provision of Law 39/2010, as from 1 January 2011, the social security
non-contributory benefit for families will be EUR 291, regardless of the
child or minor’s age. The amount will be higher if the child suffers
from a disability.
3. SOCIAL SECURITY CONTRIBUTIONS
Title VIII of Law 39/2010 establishes
the social security, unemployment, salary guarantee fund and
professional training contribution bases and rates for 2011, and the
maximum and minimum social security contribution bases. In 2011, the
maximum contribution base will be EUR 3,230.10 per month whereas the
minimum, calculated by increasing the minimum legal wage by one sixth,
will be EUR 738.85 per month.
3.1. Contribution
reduction to maintain employment levels
The fourth additional provision of Law
39/2010 states that companies are entitled to reduce the social security
contributions of their permanent employees aged 59 or over by 40%,
provided they have been working for the company for at least four years.
3.2. Social security
contribution reduction for workers changing position because of risks
during pregnancy or breast feeding, or due to an occupational illness
The fifth additional provision of Law
39/2010 establishes a 50% reduction of companies’ social security
contributions for employees who need to change position or carry out
different tasks in the company because of pregnancy or breast feeding,
or due to an occupational illness. This reduction is applicable while an
employee is in the new position or is carrying out the different tasks.
3.3. Maintenance of
pensioners’ purchasing power
The eighth additional provision of Law
39/2010 establishes that all pensioners whose pensions should have been
adjusted in 2010 will receive an extraordinary payment to compensate for
the difference between the pension received in 2010 and the pension that
they should have received in view of the retail price index in the
twelve-month period between November 2009 and 2010.
3.4. The
remuneration of managers and employees of social security industrial
accident mutual insurance societies
The fifty-ninth additional provision of
Law 39/2010 establishes that the salaries of managers of social
security industrial accident mutual insurance societies must not exceed
the highest salaries of senior members of national authorities, and that
their 2011 salaries cannot exceed their 2010 salaries.
4. LEGAL RATE OF INTEREST
The seventeenth additional provision of
Law 39/2010 sets forth that until 31 December 2011, the legal rate of
interest will remain at the 2010 rate of 4%, and that the late payment
interest rate referred to in the General Taxation Law will be 5%.
5. IPREM (National Indicator of Earnings)
The eighteenth additional provision of
Law 39/2010 establishes the following IPREM values for 2011:
- Daily IPREM: EUR 17.75
- Monthly IPREM: EUR 532.51
- Annual IPREM: EUR 6,390.13
With regard to any legislation which
refers to the IPREM, rather than the national minimum wage, the annual
IPREM will be EUR 7,455.14, unless the legislation expressly excludes
the extraordinary salary payments made in summer and winter, in which
case the annual IPREM will be EUR 6,390.13.
6. LEGISLATIVE AMENDMENTS
6.1. Amendment of
the Statue of Workers approved by Royal Legislative Decree 1/1995 of 24
March
The twenty-second final provision of
Law 39/2010 adds a new paragraph to the fifth section of article 37 of
the Statute of Workers. Pursuant to this amendment, a worker who has in
his or her care a child under the age of eighteen who suffers from
cancer or any other serious illness that requires hospitalisation and
continuous care may request a reduction in his or her working day of 50%
or more (with the corresponding reduction in salary). This reduction can
only be requested if the illness requires a long period of
hospitalisation and direct, continuous and permanent care.
6.2. Amendment of
Law 7/2007 of 12 April of the Basic Statute of Public Workers
The twenty-third final provision of Law
39/2010 adds a new article 49(e) to the Basic Statute of Public Workers
that gives public sector workers the same right as that set out in the
Statute of Workers to reduce their working day when a child in their
care suffers from cancer or any other serious illness.
6.3. Amendment of
the consolidated text of the General Social Security Law approved by
Royal Legislative Decree 1/1994 of 20 June
The third and twenty-first final
provisions of Law 39/2010 modify the following articles of the General
Social Security Law:
1. Section 3 of article 23 on
declaring the improper receipt of funds.
2. Article 37 on the disposal of
attachable property.
3. Section 3 of article 71 on the
maintenance of social security mutual insurance society reserves.
4. First two paragraphs of article
128.1(a) on the concept of temporary disability.
5. Article 73 on how profits from the
management of professional contingency payments may be used.
6. Section 3 of article 76 on the
compensation paid to social security mutual insurance society members
at the end of an employment relationship.
7. Section 3 of article 215 on the
type of income considered when determining entitlement to unemployment
benefits.
8. Inclusion of a new additional
provision that extends work accident protection to everyone included
under the social security special regime for domestic workers.
9. Inclusion of a new chapter IV-6 in
Title II that provides for a new benefit for all workers who request
at least a 50% reduction of their working hours when a child in their
care is hospitalised for an extended period of time due to cancer or
any other serious illness.
6.4. Amendment of
Law 9/2009 of 6 October on the extension of paternity leave
The second final provision of Law 9/209
provides that the extended period of paternity leave will enter into
force on 1 January 2012.
6.5. Orphanhood
state pension
The nineteenth final provision
introduces a recommendation to the government to study the possibility
of extending entitlement to the orphanhood pension until the recipient
completes his or her studies, or at least until he or she turns 25. It
is also recommends that the possibility of claiming other benefits at
the same time as this pension be studied.
