Spain’s Ministry of Inclusion and Social Security is exploring a plan to favor early retirement for professions that experience higher rates of medical leaves and thus place a greater burden on public finances. The department led by Elma Saiz is working with employers and unions to create a set of indicators to decide when workers in a given trade can retire earlier without negatively affecting their pension amounts. The overall amount public funds pay out for temporary disability is one of the three criteria currently laid out in a draft discussed between the government and social partners.
Negotiations within the social dialogue are in an early stage, and the draft’s content remains subject to change. Yet it has already stirred tensions between the government and the social actors. Industry representatives, according to various sources, disagree with parts of the indicators and warn that they may introduce gender bias due to the current underreporting of medical leaves in sectors where most workers are women.
Tres the Social Security body has put forward three variables to objectify when it is lawful for an employee to retire before the legal retirement age, which currently stands at 66 years and six months. First, the total amount paid by the state in disability benefits, relative to the money workers in the sector contribute. Second, the total number of temporary disability leaves, relative to the total number of employees exposed. And third, the share of accidents resulting in death in the sector. Under the plan, the latest feasible retirement age would be 52, never earlier.
Based on these indicators, any representative employer or union in a sector could request the government to identify that profession as particularly hazardous and, consequently, allow early retirement. Being classified as such would also require employers and workers in the sector to contribute to a supplementary tax to offset the early departure. Once the request is filed, the government commits to responding within a maximum of six months, as the current process could drag on indefinitely.
Early frictions emerge
The pension reform talks are advancing, and both sides are scheduled to meet again in about two weeks to push the document toward broader consensus. Some parties have convinced others, while some remain at odds. Unions argue that the Social Security criteria may be too restrictive for the most physically demanding professions, which nonetheless experience fewer recognized leaves. They point to a mismatch that could disadvantage workers in strenuous roles.
An example cited by unions is that of hotel housekeepers who often suffer back problems due to the nature of their work. In contrast, a miner might find it easier to have his need for early retirement recognized under the current framework. This has raised concerns about a potential gender bias in the government’s reform proposals.
UGT has been particularly outspoken after the Monday meeting. Cristina Estevez, speaking on behalf of corporate policy, noted a concern about unequal treatment that could affect female workers and highlighted the potential disparity before officials and media. Other sources familiar with the talks acknowledge the gender differences at play, while representatives from the main business association declined to comment.
The ministry, under minister Saiz, has included two commitments in the draft to ease these fears. First, within six months a working group will analyze those demanding roles that are strenuous but do not show high morbidity or mortality. Second, within twelve months a separate commission will study the gender impact of the reform on early retirements. These commitments are viewed skeptically by the unions and other social partners.
The ministry has stated that recommendations from the social partners will be incorporated into the text in the coming days, according to a brief statement issued after the meeting.
Mutuals under debate
Another aspect of pension reform being discussed is the role of mutual insurance funds in handling workers on temporary disability. Mutuals are private entities that the Social Security system funds with public money collected from payroll contributions. They can handle treatments for workplace incidents and a portion of the benefits paid to workers on leave.
Last month, employers and unions reached an initial agreement to study how mutuals could assume a larger role in caring for workers on leave due to non-occupational injuries, such as a football-related injury sustained in free time that prevents a worker from performing duties. The Social Security proposal envisions expanding mutual involvement in cases where recovery durations exceed normal timelines, with the worker’s explicit consent. According to the proposed protocol, a public physician must respond within five days to the mutual’s high-level acceleration requests for returns to work.
Employers and unions clash over this point because business representatives want greater influence over the medical assessments performed by mutuals, while unions fear pressure on workers to return early from leave.