The Bank of Spain notes an increase in the anti-inflation armor in the agreements, but for the most part not completely and without retroactive effect
Despite the shutdown of the bosses, who radically refuse to include them in a new collective bargaining agreement, more and more workers are protected from inflation with clauses in their agreements, albeit with some limits. This is confirmed by the Bank of Spain in a short analysis published this Wednesday, in which it confirms what this newspaper had already claimed: that 25% of the employees covered by the agreement are shielded from price fluctuations, a much higher percentage higher than the 16.6% recorded on average between 2014 and 2021, although on the other hand “significantly” lower than what was collected until 2009, when they were the vast majority.
In addition, the regulator states that this level will rise significantly more in 2023 and will exceed 40%, according to data from the agreements already signed for next year. However, this does not mean that, as the unions demand, these workers have a guarantee that they will not lose their purchasing power during these years, as most of these clauses are in fine print and do not fully protect them.
For example, 75% of employees with wage clauses in effect in 2022 have certain limits or thresholds included in their contracts, above which these clauses do not work. In other words, the salary revision agreed in the clauses does not necessarily imply a full transfer to wages of the differences that occur between the observed inflation and the wage increase initially agreed, but this transfer is in most cases partial, based on percentages that according to the Bank of Spain in recent years also “particularly” have been reduced.
In turn, just over half of employees would be affected by non-retroactive indemnification clauses meaning that any activation of the clauses would not imply salary adjustments related to past years but only an update of salary rates for next year .
Another aspect the report analyzes is whether the salary review is performed annually or multi-yearly. In this case, just over 60% of the employees covered by these clauses have an annual reference; that is, any salary revision would be determined based on year-end inflation. On the other hand, 20% of the employees affected by these clauses are faced with a multi-year reference; that is, the potential salary revisions would be determined based on inflation behavior over the term of the agreement. The public body explains that “in a context where the current high inflation rates could slow significantly in the coming years, these multi-year clauses would help mitigate the impact of inflation on labor costs in the near term.”
Source: La Verdad