Three Economics Words That Have Become Popular This Year | My finances section

At the beginning of this year, when the first news about a “mysterious pneumonia” began to arrive from China – one of the symptoms of the disease that would soon be baptized with the name of Covid-19 – few imagined that terms such as teleworking, ERTE or mortgage moratorium, among other economic concepts, would later have been used with such assiduity. To exist, they existed. But they remained on the sidelines, as if they designated something chimerical, in some cases, or were intended to indicate few very specific situations. On the contrary – as happened in the previous crisis with the risk premium, just to take an example – the havoc caused in the economy by the coronavirus pandemic has quickly made them very popular.

Telecommuting

Not even five out of 100 employees. This was the proportion of the active population that used to work remotely last year in Spain, according to the INE. If it was already a gradually upward trend -in 2018 it had been 4.3%, against 4.8% in 2019-, teleworking has known a real explosion this year, due to the outbreak of the coronavirus. So much so that 36.6% of those surveyed in the latest study by the Centro de Investigaciones Sociológicas (CIS) declared that they had started teleworking because of the pandemic, compared to 34.9% who continue to do their jobs in the same way as it usually did before the arrival of the virus. On the contrary, 28% have not been able to consider the use of teleworking because the nature of the activity prevents it.

The most relevant data from the CIS survey, however, is perhaps 68.8% of teleworkers who claim to be satisfied or very satisfied with this form of employment, or those three out of four who think it is a good way to work, whether or not there is a pandemic. Therefore, despite the problems of reconciliation with family tasks and a certain nostalgia for the office that it brings in some cases, telework seems to have come to stay and is already revolutionizing spaces dedicated to employment in large cities (such as case of those restaurants and hotels that become makeshift offices) or gives wings to emptied Spain, rescuing the attractiveness of the small towns to which some workers have decided to move.

In any case, the legal aspects are regulated by the new Law on remote work, in which it is established that teleworkers “will have the right to the provision and adequate maintenance by the company of all the means, equipment and tools necessary for the development of the activity”, as well as the necessary technical assistance. In addition, “the development of remote work must be paid for or compensated by the company, and may not involve the assumption by the worker of expenses related to the equipment, tools and means linked to the development of their work activity”. However, the setting of these related means and expenses is subject to the signing of an agreement between the company and the employee. The regulation also does not apply to remote activity forced by the pandemic.

FOR HIM

The temporary employment regulation file (ERTE), partial or total, is a tool that both the Government and social agents consider the main asset to cushion the impact of the Covid pandemic in the world of work. In exchange for particularly favorable Social Security contributions, companies can use this instrument to guarantee employment and part of the salary for their workers.

Through the agreement between the Government, employers and unions, reached at the end of September, the ERTEs in force at that time are extended until January 31 and the amount of the benefit remains the same, at 70% of the regulatory base ( previously it was expected to drop to 50% from the sixth month). Since October 1, the cases in which a company can access the ERTE are due to impediments to opening, limitations and force majeure.

In this way, companies that cannot open their businesses due to confinement measures or closure obligation to contain coronavirus infections can take advantage of these files and, if they have less than 50 employees, they benefit from a 100% exemption in Social Security contributions during closing. The largest have a reduction of 90%. In the same way, companies and entities in any sector or activity that see development limited by health issues obtained in their ERTE an exemption of 100% in October, which went to 90% in November, it is 85% in December and will be 80% in January, for firms with less than 50 workers. For the largest, the exemption is 90%, 80%, 75% and 70%, respectively.

Likewise, ERTE due to force majeure, linked to the pandemic, can be applied if they are carried out in one of the sectors that appear on the list of those most affected. The exemptions in Social Security contributions are 85% from October to January in companies with fewer than 50 workers and 75% in those with more than 50.

Mortgage moratorium

It is another of the terms with which Spain has become familiar, an absolute novelty, which involves the suspension of the payment of the loan installment for the acquisition of the first home, in whole or in part. It was one of the first measures of the so-called social shield approved by the Government in the early stages of the pandemic, in March, and was extended in July.

Until September 29, the mortgaged could request a legal moratorium of three months on the accrual of capital and interest, but only if they met these four requirements at the same time: have been left without a job or, in the case of being a businessman, prove a loss of income greater than 40%; that the income of the family unit in the month prior to the application does not exceed 1,613.52 euros; that the loan installments, plus basic expenses and supplies were equal to or greater than 35% of the net income received by all members of the family unit; and that the effort represented by the burden of loans on family income had multiplied by at least 1.3 since the beginning of the crisis.

Households that did not meet all these assumptions could benefit from the banking sector moratorium for a period of nine months. Of course, in this case only the return of the capital was suspended, but not the interest. The legal moratorium could be linked to the sectoral one, to thus cover a period of one year. At the end of June, a little more than 735,000 mortgage defaults had been granted, between official (226,000) and sectoral (509,000), according to the Bank of Spain.

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