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View Full Version : Employment And people wonder why Spain's Social Security bill is so high...



LosRoques
02-03-2012, 14:30
So we've been discussing recent events with friends and associates here and a situation came to light that highlights the mentality of the populace towards the paro (unemployment benefit).

An employee in a place we know wanted to leave but didn't want to work full notice.

So the employee tells the employer they'll work for as long as is necessary as long as the employer signs the employee off as though they've been asked to leave (but not as though they've been sacked for misconduct) so that they can get paro. In other words, the employee is asking the employer to commit fraud for the benefit of the employee. The employer says no and then points out that under Spanish law the employer can discount from the employee's pay as a penalty any days of the notice period that the employee was absent without permission or baja (sick note). So if an employee walks out you don't have to pay them for the last 15 days worked, or more if the contract has a longer notice period. Despite this, the employee insists on mutually agreed contract end to be able to get the paro or nothing, threatening to take court action if the employer discounts the salary.

What's interesting is how "normal" this kind of thing seems to be.

Ask anyone who owns a company or has owned a company whether they'd take part in the fraud and they'll either say "no, absolutely not, it's fraud and is why we pay so much social security" or they might say "well, if it's someone you know and like then maybe it's ok but otherwise no".

However, ask pretty much any employee what they think and they'll say "sure, why not, that's why we pay social security". What they don't realise is that the employee pays about 6c on the € for social security and the employer pays around 30c on the €, so it's really the employers that are paying for this. Point this out and most will shrug and say "so?".

It seems in general "off the record" conversation that the majority of employees here in Spain are ok with the idea of committing some kind fraud to get benefits, and that in general unemployment benefit is an entitlement regardless of whether or not your circumstances are of your own making.

Many even take advantage of the 9 month contract churn to work for 9 months and then take up to 6 months on the paro, which previously paid out up to 70% of the last 6 months' salary (though that's changed with the austerity measures). On two occasions we've had people turn down a job offer because they'd rather use up their paro and work somewhere for less hours cash in hand than take a full-time contract and lose the paro payments.....

They don't seem to realised that a massive social security bill is one of the main reasons the deficit is so high and that by taking advantage of the system they're pushing Spain even more into the red.

Makes you wonder, of the 25-30% unemployed, how many are actually working as well, and how many chose to be unemployed for a few months before taking another contract? If I were truly unemployed and couldn't find work I'd be really angry at those that were cheating the system, but talking to locals that doesn't seem to be the case.

Even amongst those that think it's wrong you get a shrug and a "well, it's wrong but it's normal, it's what people do".

And they wonder why Spain's Social Security bill is so high....

willowlily
02-03-2012, 16:05
So we've been discussing recent events with friends and associates here and a situation came to light that highlights the mentality of the populace towards the paro (unemployment benefit).

An employee in a place we know wanted to leave but didn't want to work full notice.

So the employee tells the employer they'll work for as long as is necessary as long as the employer signs the employee off as though they've been asked to leave (but not as though they've been sacked for misconduct) so that they can get paro. In other words, the employee is asking the employer to commit fraud for the benefit of the employee. The employer says no and then points out that under Spanish law the employer can discount from the employee's pay as a penalty any days of the notice period that the employee was absent without permission or baja (sick note). So if an employee walks out you don't have to pay them for the last 15 days worked, or more if the contract has a longer notice period. Despite this, the employee insists on mutually agreed contract end to be able to get the paro or nothing, threatening to take court action if the employer discounts the salary.

What's interesting is how "normal" this kind of thing seems to be.

Ask anyone who owns a company or has owned a company whether they'd take part in the fraud and they'll either say "no, absolutely not, it's fraud and is why we pay so much social security" or they might say "well, if it's someone you know and like then maybe it's ok but otherwise no".

However, ask pretty much any employee what they think and they'll say "sure, why not, that's why we pay social security". What they don't realise is that the employee pays about 6c on the € for social security and the employer pays around 30c on the €, so it's really the employers that are paying for this. Point this out and most will shrug and say "so?".

It seems in general "off the record" conversation that the majority of employees here in Spain are ok with the idea of committing some kind fraud to get benefits, and that in general unemployment benefit is an entitlement regardless of whether or not your circumstances are of your own making.

Many even take advantage of the 9 month contract churn to work for 9 months and then take up to 6 months on the paro, which previously paid out up to 70% of the last 6 months' salary (though that's changed with the austerity measures). On two occasions we've had people turn down a job offer because they'd rather use up their paro and work somewhere for less hours cash in hand than take a full-time contract and lose the paro payments.....

They don't seem to realised that a massive social security bill is one of the main reasons the deficit is so high and that by taking advantage of the system they're pushing Spain even more into the red.

Makes you wonder, of the 25-30% unemployed, how many are actually working as well, and how many chose to be unemployed for a few months before taking another contract? If I were truly unemployed and couldn't find work I'd be really angry at those that were cheating the system, but talking to locals that doesn't seem to be the case.

Even amongst those that think it's wrong you get a shrug and a "well, it's wrong but it's normal, it's what people do".

And they wonder why Spain's Social Security bill is so high....

collective de-frauding social security and tax will bring all europe down to its knees as it has with greece.

bonitatime
02-03-2012, 18:13
I think slowly this will get better if only because owners can't afford to pay the difference.
Unfortunately whilst there are too few inspectors there will always be cheating . Both on behalf of the employer and employee. As you have commented before part time contracts are in un-useable here for many employers who want to work properly although my understanding was they were more flexible in the restaurant trade.
The payout is now not as good as it was which might encourage people to work harder. Several employers I have talked to recently say they will not take on staff now with gaps in their CV as it shows they don't really like to work.

9PLUS
03-03-2012, 09:28
Everyone wants the money but no one wants to work of it



An employers nightmare

sunseeker
03-03-2012, 10:00
the system is wrong as a hole. its so ****** up that its going to take rajoy down unless there are drastic changes.

Angusjim
04-03-2012, 10:28
This thread is quite ammusing up until now everone has been led to believe that Britain could learn from Spain with regard to social security obviously everything is not as perfect as we were led to believe.:dontknow:

sunnydays
04-03-2012, 10:35
I have a question. worked for over a year and still have an ongoing contract (full time) thought I would get after a year a permanent contract but seems not as law changed. I don´t want to claim dole happy to carry on working but don´t fully understand the working law as such. (my own fault I know) Where can I find all the info I need.