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A No-Deal SMI Will Complicate Other Negotiations With Employers

There is no agreement on the increase in the minimum interprofessional salary (SMI) that the Government has confirmed will take place for the last tranche of this year . The meeting held on Monday by the Secretary of State for Employment, Joaquín Pérez Rey, with the employers and the unions was closed without an agreement, but with confusion regarding the continuity of the dialogue.

As explained by the CCOO and UGT negotiators – there were no comments from either the Ministry or the CEOE employers’ association in this regard – new meetings will no longer be held, although informal contacts will be maintained to continue testing an agreement, something that the unions did not rule out.

Business sources consulted by elEconomista acknowledge that if the Government opts for an increase in the SMI for this year, relations with employers will be strained, thus making other pending negotiations more difficult , such as the extension of the Ertes, whose table should be opened in the next days; the labor reform, which should have a draft in October; and the second phase of the reform of the System to underpin the sustainability of pensions.

Calviño’s nuance
In addition, sparks flew again between the first vice president and head of the economic area, Nadia Calviño , and the second vice president, in charge of the negotiation and leader of United We Can in the Government, Yolanda Díaz . This time it was due to the entry into force of the SMI rise. Calviño said in statements to TVE that the increase in the minimum wage for this year will be “relatively limited” and will apply from October to December, without retroactive character.

He also reiterated what he has been defending the last two months: “We have to do the increase in the SMI as long as it does not put employment at risk , especially for young people.” Calviño clarified that the Government will be guided by the recommendations of the commission of experts that it created to analyze the path of rise of the SMI to reach 60% of the average salary at the end of the legislature. He also recalled that the rise in the SMI can now resume due to positive data in the labor market, with “unprecedented” drops in unemployment and a drop in workers in temporary employment regulation files (Erte).

Although a public response was not issued from the Ministry of Labor, sources present at the meeting clarified that Pérez Rey assured that the increase will be applied from September 1 . Díaz was discreet in this regard and in statements from Oviedo he limited himself to saying regarding the entry into force of the increase that “social dialogue will be allowed to work as usual.”

“I want to be clear with those who today say that it is not necessary to raise the SMI. They should explain why they are doing it if they are negotiating agreements with higher increases, of 1.5% and 1.8%,” he said. The minister clarified that the rise in the SMI “is not going to be taken to the Council of Ministers tomorrow [for today] despite the fact that all the legal procedures are prepared for this to be the case.” “I would like there to be an agreement, but if this were not the case, the important thing is that social dialogue has taken place,” he said.

On the amount of the rise, which ranges between 12 and 19 euros as indicated by the Ministry, the vice president said that they know what the unions and the employers want and what they are trying to do is always a weighting.

Dialog tables
Although the businessmen are far from the breakdown of the negotiations, the irreversible decision of the Government to raise the minimum wage for the remainder of the year will cause the CEOE and Cepyme employers to maintain more “tense” positions at the tables they keep open with the Government .

The main one, that of the labor reform, will not be particularly affected either, since the employers have shown disagreement with the proposal that prevents a possible agreement from being glimpsed. There are more doubts on the table of the extension of the Ertes, pending call, because it will be necessary to know what the Government’s proposal is. And you also have to wait for the pension table.

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