SPAIN The Career Break (Time Credit) Scheme in Belgium and the by etssetcf

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									                                                 SPAIN

                                         The Career Break (Time Credit) Scheme in Belgium
                                    and the Incentive Premiums by the Flemish Government
                                                                   Statements and Comments



                                                               Ministerio de trabajo y asuntos sociales

Firstly, I am going to provide some information about the Spanish labour market situation, secondly, I
will shortly describe the more relevant Spanish measures whose characteristics are close to those of
Belgian career breaks and finally, I am going to refer to the potential transferability of the Belgian
scheme to Spain.

 The Spanish labour market situation is, in my opinion, the most relevant factor related to the
potential transferability of the Belgian career break incentive to Spain, since it is very specific and
very different from that in Belgian and, specially, in Flanders. This fact conditions very much the
transferability.

The Spanish labour market is characterised by low levels of labour participation and of employment
and high level of unemployment. According to the European Labour Force Survey referred to 2002,
the Spanish labour participation rate was 65,8%, the fifth lowest in the European Union, and, what is
more relevant, the employment rate was 58,4%, the third lowest in the European Union. At the same
time, the unemployment rate was 11,1%, the highest in the EU. Consequently, we can say that the
main problem of the Spanish labour market is the lack of employment demand, against the labour
market situation in Flanders, where, it seems, there is a lack of labour force supply.

Likewise, the proportion of temporary employment is very high, 31,2% in relation to total
employment, the highest in the EU, and the proportion of part-time employment is relatively low, 8%,
the second lowest in the EU.

Furthermore, gender differences in the Spanish labour market are very pronounced. The female
participation rate is 52,6%, more than 25 percentage points lower than that of the men. The female
employment rate is 44%, nearly 30 points lower than that of the men. And the female unemployment
rate is more than twice the male unemployment rate: 16,3% against 7,7%. At the same time, part-
time work accounts for 17,8% of whole female employment and for 2,6% of whole male employment.

Other characteristic of Spanish labour market is the small size of the firms, since the majority of them
has less than 10 employees (85% of firms and 22% in terms of employees) and only 0,3% are large
firms (with more that 250 employees) which represent 36% in terms of employees

Regarding the Spanish measures, I must point out that in Spain there is not any policy measure
similar to the Belgian career break incentive, but there are some measures which also have as main
objective to improve the work-life balance and the long-life learning, and some of them have certain
characteristics close to those of the Belgian career break incentive. However, the main difference
between the Spanish and Belgian measures is that in the case of Spain the leaves aren’t paid by the
Government (with the exception of maternity leave, sick, accident or disability leaves, which usually
exist in most countries).

Most of those Spanish measures are care related, above all children care related, and some of them
have been introduced or modified in 1999, by the Law of Life-Work Reconciliation (Ley de
Conciliación de la Vida Familiar y Laboral), which came into force in that year.

February 19-20, 2004               Peer Review    The Career Break (Time Credit) Scheme in            1
                                                  Belgium and the Incentive Premiums by the
                                                  Flemish Government
                                                  SPAIN

With the aim of getting a better balance between professional and private life, the Law of Life-Work
Reconciliation establishes some rights for employees to take leaves in case of family responsibilities
but, at the same time, paying special attention to not hamper the labour market participation but to
facilitate it. That is, the goal is avoid workers to withdraw from labour market in case of care family
responsibilities.

The more relevant rights regarding family friendly policy issue are the following:
    Parents with a child under three years old have the right to take up a complete suspension of
    working for a maximum period of three years (until the child is 3 years old). During this period of
    leave, workers do not receive any pay or economic benefit, but they have the right to come back
    to the same job they had before taking the leave during the first year and have the right to a job in
    the same professional category during the rest of the period. Furthermore, the period of leave is
    considered as effectively worked in terms of seniority. Finally, workers have right to receive job
    related training provided by their employers.

    The same measure has been established in favour of workers with care dependent family
    member’s responsibilities. But, in this case, the maximum period of leave is 1 year.

    Likewise, workers with children under 6 years old or who have care dependant family members
    responsibilities have the right to part-time work (the reduction must be between 1/3th and 1/2nd of
    full time work) but with a proportional reduction in their earnings. This measure existed before the
    law came into force but only in favour of workers with children under 6 years old.

Usually, these leaves can be improved by collective agreements.
    Additionally, in relation with care responsibilities, as I said before, the only relevant pay leave is
    the maternity leave. Its duration is 16 weeks and it may be taken by the mother or by the father,
    with the limitation that the mother has to take al least, 6 weeks after the birth. (This leave had
    been stabilised many years before the Law of Reconciliation and it was not changed by this law).

    Finally, with the aim to support motherhood and child care and, at the same time, to encourage
    female employment, in 2003 it was introduced a tax credit for employed women who have a child
    younger than 3 years. The annual amount is 1.200 euros for each child under the age of 3,
    including those adopted. The credit can be received monthly for a maximum of three years.
Regarding training leaves, in 2001 a pay leave was stabilised. This leave was incorporated in the
IIIed National Agreement of Continuum Vocational Training, which was signed at the end of 2000 by
the social partners for a period of 4 years: 2001-2004. To have right to this leave workers have to
have been employed by the same firm for at least one year. The leave is in order to participate in
training courses, with the restriction that these courses should be recognized by official certificates.
The duration is up to 200 hours, and the workers receive full foregone wages. The leave has to be
authorised by the employer, but if the employer refuse the career break leave, he/she has to justify
the decision providing the reasons for the refusal.




February 19-20, 2004                Peer Review    The Career Break (Time Credit) Scheme in             2
                                                   Belgium and the Incentive Premiums by the
                                                   Flemish Government
                                                 SPAIN

In addition, in the University field, there are different pay leaves whose characteristics depend on the
particular University but they usually have as common goal training and research. These leaves are
paid by the University teachers belong to. The most common is the sabbatical year leave and it is
taken in order to research during the period of leave.

Regarding the potential transferability to Spain of the Belgium career break, I consider that it is
very limited, since, as we will see, the factors that hamper the transferability are more numerous and
important than the factors that favour it.

The main factors that favour the transferability to Spain of the Belgian career break are relate to:
1) the institutional configuration of the Spanish state, and 2) the labour market.

With respect to the first factor, we can say that Spain is a quasi-federal state with 17 autonomous
communities. But the labour law is one of the prerogatives of the central state and Autonomous
Communities do not have labour legislatives competencies. This factor would facilitate the
transferability since the introduction of the Belgian scheme in Spain would require a change in the
Spanish labour law and this change can be introduced by the central state.

 Regarding the labour market, the only factor which could favour the transferability is the high
proportion of full-time employment. As many Belgian career breaks consist in a reduction of the
working time and this reduction, usually, is more interesting for full-time workers, since it allows them
to reduce their working time, the high proportion of full-time employment in Spain could favour the
transferability.

Among the factors that hamper the transferability, I would highlight as more important the low
Spanish employment rate, mainly the female employment rate, and the need to increase it.
Therefore, one of the labour policy priorities of the Spanish Government is to increase employment.
With this aim and at the same time with the goal of improving the quality of jobs, Spanish
Government has carried out some political actions to encourage employment demand, since the
main problem of Spanish labour market is the lack or the weakness of the employment demand.
Actually, the Spanish Government has established some policy measures to encourage permanent
hiring of some disadvantages groups, among them women. The objective of these measures is
twofold: to increase the level of employment and to reduce the proportion of temporary employment,
which is very high in Spain. These measures have as main incentive an important reduction of
employer’s social security contribution and they are very costly from the financial point of view.

In addition, the unemployment level in Spain is very high, although it has decrease very much during
last years, and the public expenditure dedicated to unemployment benefits is high.

On the other hand, the introduction of a measure like Belgium career break has the risk of having a
negative impact on employment and labour market participation, and, at the same time, the Belgian
incentive is very costly.

All of these factors make the transferability of the Belgian career break scheme to Spain ver unlikely.

Moreover, from the companies perspective, one of the main problems is the small average size of
the firms, since small companies have more difficulties than large companies to re-organise work in
case of absence or working time reduction of their workers. In addition, Spanish employers,
generally speaking, are not very interested in career breaks for their employees. Because, given the
low level of employment and the high level of unemployment, employers can easily find other

February 19-20, 2004               Peer Review    The Career Break (Time Credit) Scheme in             3
                                                  Belgium and the Incentive Premiums by the
                                                  Flemish Government
                                                SPAIN

workers to replace people currently working in their companies, and this alternative is less costly
than to provide current workers with rights to career breaks.

In sum, I think that the establishment of the Belgian career break in Spain is unlikely in the near
future, but it is not impossible. I argue this since, on one hand, one of the main goals of the recent
Spanish National Action Plan for Employment (NAP) is the establishment of measures to facilitate
the combination of family and professional responsibilities, and, on the other hand, the Spanish
Government is very interested in improving workers’ training. Therefore, insofar as measures such
as the Belgian incentive help to get those objectives, the Spanish Government will be in favour of
their introduction, but , from my view, they have as main problems the risk of their negative impact on
the labour market participation and the high financial cost for the Government.




February 19-20, 2004              Peer Review    The Career Break (Time Credit) Scheme in            4
                                                 Belgium and the Incentive Premiums by the
                                                 Flemish Government

								
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