The Government is going to approve an increase in the minimum wage by the end of 2021, but its negotiation has the greatest attention focused on the increase in 2022. What President Pedro Sánchez announced as an “immediate” increase in the SMI is complicating the Executive, who opened to agree the amount with the unions and employers. The bosses refuse a raise in 2021, no matter how small, which could seem to take them out of the equation of the conversations. But it is not like that: the unions demand that the Executive, together with the SMI of 2021, specify the path of rise of 2022 and the employers continue with the contacts because they are not resigned to losing influence in the increase of next year.
The Government proposes to raise this year the minimum wage a maximum of 19 euros, up to 969 euros
“Everything is very open,” say sources of social dialogue, who do not rule out any scenario in the coming days. Nor that the Government ends up approving the minimum wage alone, that a bipartite agreement be reached between the Executive and the unions, or even a three-way pact in which employers are included. The latter is the most complicated and least likely option at the moment.
The negotiation is lengthening, especially on account of the closure of the employers, but also due to the insistence of the coalition Government to approve with an agreement the rise of the SMI, now located at 950 euros per month in 14 payments. The increase in lower wages is the responsibility of the Executive, which is only obliged to submit it to social dialogue consultations. However, the Ministry of Labor led by Yolanda Díaz is trying by all means that the rise is supported by employers and unions, like so many other labor measures taken to date, with the extensions of the ERTE and the Rider Law, among others. .
The social agreement always provides stability to labor measures and often functions as a legitimating shield against criticism from the opposition. And it can not only appease external differences, but also internal ones, like those of a government that has been divided for months on whether or not it was appropriate to raise the lowest wages.
Union order of 1,000 euros in 2022
Although unions also have a role in delaying negotiations. When the Government decided not to raise the interprofessional minimum wage in January due to the crisis unleashed by the pandemic, as defended by Nadia Calviño and supported by President Pedro Sánchez against the criteria of Yolanda Díaz, CCOO and UGT took to the streets. They staged several mobilizations and insisted month after month on the need for a rise, as the vast majority of European countries had done.
With the good progress of the recovery of employment and before the increase in prices, especially of electricity, the socialist wing of the Government opened to the increase in the minimum wage by the end of the year. Unions welcomed the change of mind, but also warned that their demands in September were no longer the same as in January. If at the beginning of the year, with a context of greater uncertainty, they could access an increase in the “testimonial” SMI, that option would no longer have their support in September.
Faced with a different context, CCOO and UGT have raised their claims. They ask for an increase for this year of between 25 and 30 euros per month, to maintain the purchasing power of the million and a half people who earn the minimum wage in a scenario of high inflation, close to 3%.
Given that the Government did not want to get out of the range of 12 to 19 euros of increase recommended by the expert committee, the unions were open to accept an increase of this caliber, but provided that it included the path of increase of the SMI in 2022. The The Executive has committed to reaching an SMI of 60% of the average salary at the end of the legislature, in 2023. Both Unai Sordo and Pepe Álvarez, leaders of CCOO and UGT respectively, have reiterated that their horizon is “1,000 euros in 2022 “. Without that commitment, they do not count on them for a timid increase in these last months of 2021, they insist.
The claims of both have complicated the pact, even one signed with the unions. As it does not seem likely that the Executive will opt for a rise like the one they demand (25 to 30 euros), to add CCOO and UGT to an agreement the Government would have to define what it is going to do in 2022. But make that decision without the Entrepreneurs is delicate, as denoted by the concern of the employers, who nevertheless insist on the ‘no’ to any increase in 2021.
Pressure on employers
In the Ministry of Labor they insist that the negotiation continues. “You already know that I never give up an agreement for lost,” Vice President Yolanda Díaz has affirmed several times this week. The businessmen have been silent in recent days and have not yet sent the usual official statement with the refusal, which can be interpreted as that there is still some room for action. The second vice president has signed social agreements that seemed very complicated, such as the Teleworking Law and the legislation on riders, among others.
Even so, Yolanda Díaz has hardened her speech on the position of businessmen this Friday. His refusal to negotiate and his closure in the “zero euros” from the beginning of the talks affected the employers, a position that he considers “has no arguments” in a context like the current one.
Employers argue that an increase at this time could make it difficult to recover employment, but quite low figures are being considered (even an increase of less than 12 euros per month was offered) and that it would only take effect in three or four months. For this reason, the unions have emphasized that the position of the employers seems more “political” than based on real economic fears.
The CEOE and its leader, Antonio Garamendi, have received enough internal criticism for agreeing to so many agreements with a progressive government. Also from the main party of the right. Since Garamendi gave his opinion on the pardons of Catalan independence prisoners, the PP and Pablo Casado changed their relationship with the employer and have made it a focus of attacks. For example, for agreeing to the pension reform, which Casado called a “great mistake”.
In this context, some saw that the rise in the SMI in 2021 was a negotiation from which entrepreneurs could get off the hook without much cost and with which they could treasure a ‘no’ to Díaz and Sánchez. However, if the increase in the SMI does not only reach 2021, entrepreneurs have more to lose (and to gain), which could be an incentive to enter into an agreement. Antonio Garamendi has always defended the agreements from a practical point of view, such as the raising of the SMI to 950 euros in 2019. “We were much more concerned about the amount of a thousand euros,” the employers said at the time.
Vice President Nadia Calviño, despite having indicated that the rise would have to be delayed until October at the beginning of the week, has also added to the pressure on businessmen in recent days, with a reminder of the large sums of public money that the State is allocating in aid to the business fabric in this crisis. “Citizens would not understand that the business world does not have any kind of sensitivity to the need to improve the conditions of workers with the lowest wages. Above all, when in the course of September we are also going to have to decide what we do with ERTE and the provision of the self-employed “, he slipped.
The next few days will end the uncertainty about how the increase in the minimum wage will go ahead and, more strategically, about how the social dialogue begins this fall loaded with labor negotiations, such as the extension of the ERTE and the labor reform.