Why civil service jobs are now facing a new threat

The government is doing what it can to reduce the number of employees in the public sector. In fact, one of the hidden objectives of the Rajoy administration’s far-reaching labor reform was to facilitate collective firings within the public sphere. It achieved this when it established that having an “insufficient budget” during three consecutive quarters would be sufficient motive to justify sackings.

And now, with the legislation regarding mass-layoffs — known in Spain as EREs — it has gone one step further: it has defined “insufficient budget” as a fall of 10 percent compared to the previous year of the funds transferred to the regional administrations and local councils, or in terms of the budgetary amounts assigned to public companies, entities and organisms.

When it comes to cutting costs in the public sector, the government has made the greatest reductions in terms of its personnel payroll. On the one hand, it has lowered salaries by getting rid of the standard Christmas bonus (around seven percent of annual salary); and on the other, it has clarified the procedures to be followed in order to reduce the size of the workforce in the public sphere.

Until the labor reform was approved, there was widespread debate as to whether EREs could be executed within the public sector. The majority of experts considered the answer to be yes, but there were dissenting voices. The clarification of the reforms to the labor laws put paid to the debate: mass layoffs could take place on the basis of the aforementioned “insufficient budget;” compensation payouts for firings in those cases would correspond to the lowest amount on the scale, i.e. 20 days’ pay per year worked, capped at a full year’s salary.

Reasons for firings

This reflects the changes in the labor reform to private-sector firings, whereby companies have to prove three quarters of falling revenues before they can lay off staff, under the same conditions as those just mentioned. But there is a key difference between the two cases: in the public sector, the civil service itself can be behind the reason put forward for the sackings. It is the administrations that are responsible for putting together the budgets and subsidies for public entities, upon which decisions regarding mass layoffs will be taken according to the draft legislation on the subject, to which EL PAÍS has had access.

This measure, however, will not affect the three million or so civil servants in the public sector, whose work conditions are governed by the Public Service Statute, and not the Workers Statute. But it will affect employees who have been hired by public administrations (around 700,000 people, according to the Ministry of Public Administrations), as well as those on the payroll of companies with more than 50 percent public capital (142,000, according to the survey of the active population).

Since the February approval of the labor reforms — which also saw an end to staff cutbacks via shorter working hours or contract suspensions — there have been several examples of just how the new laws will be put into practice: public broadcaster Radio Televisión Valencia has announced the lay-offs of 1,247 employees — 76 percent of the workforce.