Employers who retire but wish to keep working and earn a salary can do so and start receiving 100% of their pension after five years of continued activity. The proposal sent this Monday by the Ministry of Inclusion, Social Security and Migrations to employers and unions outlines that active retirees would begin by receiving 30% of their pension plus their salary in the first year, with the percentage increasing gradually as they remain employed until reaching 100% of the pension in the fifth year.
This newly proposed scale would reduce the incomes of active retirees at the outset, increasing them as the individual stays active, according to sources familiar with the talks. Currently, from the first year onward, an active retiree receives 50% of their pension, plus the salary. The new scale would also be complemented by the possibility, previously prohibited, of collecting incentives for delayed retirement, which would raise the pension amount. Up to now, active retirement was mainly pursued by self-employed individuals and professionals such as doctors, lawyers, or architects.
The Secretary of Social Security, Borja Suárez, held another meeting this Monday with employers and unions to push toward an agreement on a new pension reform. While all sides left with optimistic, conciliatory signals on several issues, the biggest hurdle remains the partial retirement.
These reforms aim to deepen the changes made during the last legislative period, which sought to extend working life in Spain. Not through coercive measures like France, which raised the legal retirement age, but by enabling incentives for professionals who, for health reasons or personal choice, wished to continue working after they could retire.
Now, Minister Saiz plans a new set of incentives. On one hand, the proposal makes active retirement more attractive, meaning a retiree can continue working while drawing part of their pension. Currently, a pensioner who is still working can either draw half of their pension plus their full salary or draw 100% of their pension while employing someone else under their supervision.
The Government, which labels itself as progressive, intends to reduce by about 40% the pension amount for self-employed individuals who are retired and working. This is seen as a significant roll-back of rights. Today, self-employed retirees combine work and pension by drawing 50% of the pension. The plan is to move toward a system where the combination remains possible but with different thresholds, generating concern among unions and pushback from employers.
Another proposal from the Executive, aligned with extending the working life and contribution period, is to front-load incentives for delayed retirement. In other words, delaying retirement while continuing to work. As established in the latest reform, for every year the employee postpones retirement, they would gain an additional 4% of pension. From the second year of postponement onward, the worker would receive an extra 2% for each six months delayed. This structure allows extending a career by roughly two and a half years without waiting for the traditional third year.
That incentive system for delaying retirement has shown effects. In 2022, before it took full effect, 17,651 people who extended their careers retired earlier than planned. In 2023, that figure rose by 50% to 26,487 delayed retirements.
Encompassing the discussion, a heading now appears: Partial Retirement Stalemate. Despite progress on multiple fronts, the core obstacle remains the reform of partial retirement, blocking the final accord on the entire package. A union official stated that the issue is non-negotiable and that progress toward a proposal that could yield an agreement remains distant. Unions seek to standardize partial retirement conditions across industries, while the government opposes streamlining partial-work rates to full-time schedules or lifting the retirement age ahead of schedule, citing potential higher costs to the state and undermining life-lengthening incentives. Union sources say they have asked Social Security for the projected budget impact but have not received detailed responses.
The article closes with a note that readers should stay tuned for further developments as talks continue, with the expectation that more clarity will emerge from the ongoing negotiations and public statements by all parties.