Minumum Wage

[tuckswood8]

Our community employs an assistant gardener who has worked for us for 25 years. He works 6.5 hrs per day Monday to Friday (not including breaks), a total of 32.5 hours per week. He gets 15 months pay every year including a Paga Extra in July and December and a Paga Verde in October. He gets all the statutory holidays and 30 days annual leave.

The community recently changed administrators and the new one has changed to a different asesoria laboral. With the previous asesoria the emplyees monthly base salary was €826.80 plus antiguedad and clothing allowance, but the new firm have put a base salary of €985.40 on the nomina. I have contacted the previous asesoria who say that their figure was correct and was some way above the legal minimum for an assistant gardener, having been increased by the community over the years.
The new firm say their figure is correct according to the rates agreed with the "union"? and that we have been underpaying the employee. There does not appear to be an original contract of employment available, but it seems to me that the first asesoria is probably correct as they have been preparing the wages for all these years and their figure is considerably above the national minimum wage.

Any help would be much appreciated as the asesoria say that we should have a new contract of employment agreed and in place by 1st January.

[Trooperman]

Quote:
He gets 15 months pay every year including a Paga Extra in July and December and a Paga Verde in October. He gets all the statutory holidays and 30 days annual leave.

Does anyone wonder why Spain is in an economic mess?


I afraid I just couldn't resist commenting, but I'm sorry I cannot help with your question

[gus-lopez]

http://www.google.com/publicdata?ds=z3e ... nimum+wage

http://expatlifespain.com/spain-minimum-wage-up-just-15 This is the official rate for 2010, unless it rose again during the year but I can't find any reference to it. Whether it goes up in january , I don't know. Both rates shown here in in excess of what you were already paying.

[fincalospinos]

Quote:
He gets 15 months pay every year including a Paga Extra in July and December and a Paga Verde in October. He gets all the statutory holidays and 30 days annual leave.

Does anyone wonder why Spain is in an economic mess?


I afraid I just couldn't resist commenting, but I'm sorry I cannot help with your question

Whats the problem with a 15 month pay deal ? At €826 / month, it still only works out less than €12.5k per year, not a vast fortune, and certainly not likely to plunge Spain into an economic crisis

[Trooperman]

As I said, I cannot contribute to the actual question posed in the thread but for fincalospinos, this is my take on it:


It’s a deceitful and messy way to go about determining a remuneration package. What is his base rate? What is his holiday pay calculated on? If his employment is terminated, what is the severance pay based on? Does he get the additional payments regardless of performance? If he leaves between these extra payments is it calculated pro-rata? What part of his wage goes to make up statistical returns? Why do it anyway?

Its not the amount that will bankrupt Spain, it’s the messy approach to employment and labour relations that will do the damage.

It is the sort of activity that went on in the 70s in the UK, in various industries, to circumvent wage restraint deals that disrupted the normal market-forces approach to hiring and firing of labour. It all went horribly wrong then when Dennis Healey had to go cap in hand to the IMF

[Bongtrees]

It’s a deceitful and messy way to go about determining a remuneration package. What is his base rate? What is his holiday pay calculated on? If his employment is terminated, what is the severance pay based on? Does he get the additional payments regardless of performance? If he leaves between these extra payments is it calculated pro-rata? What part of his wage goes to make up statistical returns? Why do it anyway?

It is neither deceitful nor messy, it is the way it is in Spain. The one remarkable thing is that this person is actually employed with a contract and both he and his employer are contributing to the tax system.

When I first started employing people in Spain I just could not get my head around it, however over the years I know from experience that the rate is the monthly rate as quoted here. Holiday, sickness maternity and severance pay are worked out by the gestor using tax tables etc exactly the same as anywhere else and I can tell you that employees know exactly how much they are entitled to and if they think for one minute they are being short changed they go immediately to the tax office to sort it out.

[gus-lopez]

As I said, I cannot contribute to the actual question posed in the thread but for fincalospinos, this is my take on it:


It’s a deceitful and messy way to go about determining a remuneration package. What is his base rate? What is his holiday pay calculated on? If his employment is terminated, what is the severance pay based on? Does he get the additional payments regardless of performance? If he leaves between these extra payments is it calculated pro-rata? What part of his wage goes to make up statistical returns? Why do it anyway?

Its not the amount that will bankrupt Spain, it’s the messy approach to employment and labour relations that will do the damage.

It is the sort of activity that went on in the 70s in the UK, in various industries, to circumvent wage restraint deals that disrupted the normal market-forces approach to hiring and firing of labour. It all went horribly wrong then when Dennis Healey had to go cap in hand to the IMF

He'd probably like to be made redundant if he's on a full contract. 45days wages for each year he's worked , over 46k €'s. Then he'd be entitled to 2 years unemployment benefit. Must nearly be up to pension age then .

[tuckswood8]

The minimum monthly wage (SMI) in 2010 was €633.33 and the government propose to raise this by 1% for 2011 http://www.zfinanzas.es/smi-sube-2011/ Zapatero made a pre-election pledge to increase SMI to €800 by the end of his term in office, but as with all such pledges the reality is somewhat different once actually in office.

In any case it would seem that our employee's monthly base salary of €826.80 is considerably in excess of any actual or proposed minimum. In addition he gets a monthly "antiguedad" payment of €123.12 (this is a statutory payment based on length of service) plus clothing and transport allowances. His actual take home pay this year will be €13,855.81. We also paid €6,282.17 for his social security.

What I really need to know is whether there is any legal agreement with a union or government body which requires us to pay an assistant gardener at a rate so far in excess of SMI. Despite much searching on the internet I have been unable to find any such requirement, although I did discover that the October "Paga Verde" is a statutory payment to all gardeners (why only gardeners?)

[tuckswood8]

He'd probably like to be made redundant if he's on a full contract. 45days wages for each year he's worked , over 46k €'s. Then he'd be entitled to 2 years unemployment benefit. Must nearly be up to pension age then .

My last post crossed with yours. Yes you have it right..... we want to reduce his hours, he wants to be made redundant. We did ask the asesoria how much the redundancy payment would be.... €52,681 ! There are only 28 properties in our small community and so it looks as though we are stuck with him until retirement, (he is only 53), even though his work could easily be done in 3 days per week not 5.

[julian]

"45days wages for each year he's worked"

wasn´t that changed to 20 days in the recent reforma laboral?

[Jool]

I am intrigued by this subject - how can you have to pay

€6,282.17 for his social security.

? Seems really high to me, he must be on a higher contribution level and not the minimum then, is this age related? There are special conditions for agricultural workers, surely a creative Accountant could get his contract changed to that whereby the costs to employ him are cheaper? Maybe then his salary could stay the same but it does seem quite high compared to the average.......

Curiouser and curiouser....

[tuckswood8]

"45days wages for each year he's worked"

wasn´t that changed to 20 days in the recent reforma laboral?

That only applies to employees taken on after the legislation was passed and was designed to encourage employers to hire new workers. For existing employees the 45 days still applies.

[Bongtrees]

I am intrigued by this subject - how can you have to pay

€6,282.17 for his social security.

? Seems really high to me, he must be on a higher contribution level and not the minimum then, is this age related? There are special conditions for agricultural workers, surely a creative Accountant could get his contract changed to that whereby the costs to employ him are cheaper? Maybe then his salary could stay the same but it does seem quite high compared to the average.......
Curiouser and curiouser....

It is not curious all. As stated before I actually had Spanish employees all legally employed for 8 years and sounds right to me. The amount could possibly be the combined amount employer and employee for the year. It is well known that employers contributions are very high, somewhere in the order of 40 or 50% (I cant remember which).

To suggest that there is someone somewhere who will get his contract changed is quite frankly astonishing. This person is not going to voluntarily end his current contract thus waiving the right to a huge redundancy payout and sign a new one with a reduced pay packet and less unemployment benefits etc so that a few self serving property owners can save a few euros

The contract is cast iron and correct according to Spanish employment laws.

[Trooperman]

As Bongtrees says: The contract is cast iron and correct according to Spanish employment laws.


As I said: Does anyone wonder why Spain is in an economic mess?


I rest my case (but I'm sorry I can't find a solution for the original questioner)

[gus-lopez]

Well at the moment it's costing you 719.21€ , each per year to employ him. It will cost each of you 1881,46€ to make him redundant. Then you either do it yourselves, or employ someone on a 1,3 or 6 month contract or autonomo.

[Jool]

Bongtrees could you make 2011 the year you actually read my posts properly? Nowhere did I say he should get a wage reduction....you are entitled to adjust contracts by mutual agreement without losing all the benefits accrued so far.

There are special conditions for agricultural workers, surely a creative Accountant could get his contract changed to that whereby the costs to employ him are cheaper? Maybe then his salary could stay the same

If this is what employers HAVE to pay as a standard level of contribution it is no wonder there is such a thriving black market and strengthens my argument that Spain urgently needs more flexibility in the employment market

[markwilding]

I agree with you Jool
Many on here, who read my posts regarding politics, know I'm left of centre. However, I can't help but feel that the labour laws in Spain help to contribute to the high levels of unemployment. The lack of flexiblity is a major problem not only in the obvious way that employers have to think twice before they will take someone on.

The main problem as I see it is, that once people have their permanant contract,they don't want to change jobs, meaning that there is a very small merry-go-round of people going in and out of work, which in turn means those out of work find it very difficult to get on the merry-go-round.

Having said that, The gardener in this case would be equally protected in the UK because of the duration of his employment.If he was made redundant after so many years working, paying his taxes and NI, He would be entitled to a redundancy payment and maybe more if someone else was employed in his place.

[janda_grant2]

Mark, in the UK, theoretically, you can't make some one redundant if their job is still there and is basically unchanged, a reduction in hours is not necesarily good enough grounds. So you couldn't employ someone else in the gardeners place, otherwise they have grounds for unfair dismissal. It's the job that disappears rather than a change in the conditions. Not sure if that applies here though.

[El Cid]

Having said that, The gardener in this case would be equally protected in the UK because of the duration of his employment.If he was made redundent after so many years working, paying his taxes and NI, He would be entitled to a redundency payment and maybe more if someone else was employed in his place.

The difference is that in the UK, based on his figures, he would get less than £6000 in redundancy pay.

Just a bit less than the €52k he would get here!

Sid

[markwilding]

In the UK though his employers may have to pay him compensation and the courts may force them to re-employ him
I'm also doubting the amount that this Spanish gardener would be paid in compensation as I've been told in the past, when talking about this subject, that there is a max that can be paid out. I going to ask a company solicitor friend of mine what the rules are.