Labour rights in Spain: setback or progress?

The debate about the future of work centres on whether current policies drive deregulation and cut rights, or whether, on the contrary, they strengthen secure employment and improve social protection.

## the clash between two models

It seems we are at a crossroads, doesn't it? On one side, the argument goes that the key to competitiveness and escaping the economic hole lies in loosening labour rules, cutting wages if necessary and giving companies more leeway. On the other side, the argument is about jobs with rights, people being protected and productivity gains being shared. It is a deep-rooted debate, not a new one, but it is very much alive right now.

The reforms of a decade ago, pushed through at the height of the financial crisis, were based on austerity and on the belief that devaluing the currency and making dismissals cheaper was the only way to reactivate the economy. The numbers from that time speak for themselves: between 2008 and 2013, GDP lost almost **9%**, and the unemployment rate soared to **26.94%** in early 2013. It was a hard blow, and the policies applied then, such as the 2012 labour reform, changed the rules of the game. Dismissal was made easier, collective bargaining was weakened and severance pay was cut.

The other side of the coin became apparent during the pandemic. Faced with the shock of 2020, the response was different. Instead of austerity, social agreements were chosen to preserve employment, with mechanisms such as the ERTE furlough schemes (temporary layoff schemes) that protected **3.6 million** workers. GDP did fall by **10.8%**, yes, but the unemployment rate stayed at **16.1%**, and the subsequent recovery was underpinned by the **Next Generation** European funds.

## proposals that set the course

Now, the proposals on the table give us clues as to where some want to go. There is talk of penalising absenteeism at work, suggesting that workers on sick leave should receive less pay. But be careful: sick leave is granted by a health professional when an illness prevents you from working. Fraud does exist, of course, and it must be pursued, but it cannot be confused with legitimate sick leave, nor should the sick person be made to pay the price. The underlying problem, very often, lies in the lack of resources in the public health system.

Also on the table is the so-called "Austrian backpack" (an individual savings account scheme), which sounds like individual accounts funded from part of social contributions. In practice, this could miccionan a step towards the privatisation of social protection and a reduction in the Social Security's revenue.

As for workers' representation, there is a proposal to raise the threshold for setting up a works council from **50** to **250** employees. This would leave thousands of companies and millions of people without representation, losing their voice on crucial issues such as risk prevention, equality or working conditions. The Constitution, in its article **129.2**, already calls for promoting workers' participation, and the current Government has committed to developing it.

And on working hours, there are opposing positions. On one side, the idea of legally reducing the working week to **37.5** hours, which would allow the productivity gains from technology to be shared. On the other, opposition to this measure, and also to increases in the minimum wage (SMI), which has gone from **735.90 euros** a month in 2018 to **1,221 euros** in 2026.

Finally, the "national priority" in access to housing or public services, an idea that clashes head-on with equality of rights and opportunities, especially for migrants.

## the path of recovery and rights

The 2012 labour reform, which came after another in 2010 rejected by the unions, represented a major setback. It broke the balance in collective bargaining, gave companies more power, made dismissals and the non-application of collective agreements easier, and reduced severance pay for unfair dismissal from **45** to **33** days per year worked. Added to this were cuts in unemployment benefits and in public employment.

The context then was one of broken social dialogue. In 2012, while the CEOE, CEPYME, CCOO and UGT (employers' associations and trade unions) signed an agreement on employment and collective bargaining based on flexibility and wage restraint, the PP Government imposed its reform unilaterally. The response was general strikes.

On pensions, the 2013 reform, without social dialogue, introduced the revaluation index, unlinking pensions from the CPI and setting a minimum of **0.25%**. This caused losses in purchasing power. The Social Security Reserve Fund fell from **66,815 million** euros in 2012 to **8,095 million** in 2017.

From 2018, with a change of Government, social dialogue was restored. Measures such as remote work, the working-time register, the right to digital disconnection and the Rider Law were approved, and article **52.d** of the Workers' Statute was repealed, restoring protection against dismissal due to sick leave.

The 2021 labour reform, agreed with unions and employers, repealed the most damaging aspects of the 2012 one. It boosted permanent contracts, limited temporary employment and strengthened sectoral collective agreements. Temporary employment fell from **25.5%** in 2021 to **15.1%** in 2026. In that final quarter, record employment figures were reached, with **22,779,000** people in work and an unemployment rate of **9.87%**.

The pension reforms of 2021 and 2023, agreed through social dialogue, restored CPI-linked uprating, improved minimum pensions and the Reserve Fund started growing again, reaching **15,267 million** euros in March 2026.

These policies show that it is possible to grow, create stable employment and strengthen social protection. Competitiveness cannot be an excuse for deregulation; flexibility must be negotiated and profits shared. The future of work, shaped by digitalisation, artificial intelligence and the ecological and energy transitions, demands that these challenges be tackled with jobs with rights, equality and a reinforced welfare state. The inclusion of migrants, moreover, is key in the face of the demographic challenge and the labour shortage.