Individual Case (CAS) - Discussion: 2013, Publication: 102nd ILC session (2013)

Employment Policy Convention, 1964 (No. 122) - Spain (Ratification: 1970)

The Government provided the following written information.

The Convention provided that each ILO Member shall pursue an active policy designed to promote full, productive and freely chosen employment, with the participation of the social partners. The Government’s economic and employment strategy had been established in the context of the European Semester, and its actions correspond to the priority areas identified in the Annual Growth Forecast 2013. A particular objective is to tackle unemployment and the social consequences of the crisis and also achieve the objectives of the Europe 2020 strategy. The reform of the labour market had entered into force in February 2012, and had been adopted by Parliament in Act No. 3/2012 of 6 July 2012. The labour market reform established a new framework for labour relations with a view to modifying the dynamics and adjustment pattern of the Spanish labour market, thereby constituting a key aspect of preparing the way for jobs-oriented economic recovery. Its prime objective was to promote internal flexibility measures through instruments that enable enterprises to adapt to economic circumstances without causing massive job losses and to improve the employability of workers. Monitoring of the reform would continue in 2013 through the groups and committees established and an interim evaluation report on its outcome would be drawn up by an independent body, the Organisation for Economic Co-operation and Development (OECD) during the first year of implementation. It would be published once the data from the active population survey for the first quarter of 2013 had been analysed.

Active employment policies were a new strategy designed to improve employability, especially of the youngest workers. In Spain in 2012 they had followed, and would continue to follow in 2013, a new strategy based on the following five major areas of action, agreed upon with the autonomous communities at the Sectoral Employment Conference of 11 April 2013.

Institutional aspects: Coordination, evaluation and efficiency. The Annual Employment Policy Plan 2012 was a fundamental landmark for establishing proper coordination between the various competent administrations (Autonomous Communities and the state administration) and the progressive establishment of a culture of evaluation with regard to active employment policies. During 2012, the autonomous communities, in order to determine actions under the funds distributed by the Public State Employment Service, had to follow the six priority objectives of the Annual Employment Policy Plan, namely: reducing the youth unemployment rate; improving the employability of other groups affected by unemployment; supporting entrepreneurs through job-creation measures and sustaining them in the labour market; strengthening public–private partnerships to reinforce the search for jobs for unemployed persons; developing measures to promote employment for specific groups, with a special focus on persons with disabilities; and taking action against fraud. Moreover, the Plan incorporated, as an innovative element, indicators to show the degree of compliance with the objectives established and the evaluation of actions taken. In October 2012, through an agreement reached at the Sectoral Conference between the Ministry of Employment and Social Security and the autonomous communities, a working party had been set up to evaluate the active policies that had been implemented. During 2012, a total of 82 coordination meetings had been held. As a continuation of the 2012 strategy, the second quarter of 2013 of the Employment Policy Plan 2013 would be adopted, the main content of which had been discussed at the state-autonomous communities Sectoral Conference held in April 2013. The 2013 Plan would strengthen incentives to achieve improved efficiency through a results-based approach. The priority objectives and measures of the 2013 Plan, which would be adopted before the end of the first half of the year, would be established on the basis of the results of the evaluation which was currently in progress. Those results would determine the new distribution of funds among the autonomous communities for pursuing active employment policies, which this year amounted to €1.345 million, 15 per cent of which would be distributed among the Autonomous Communities according to the established objectives. The Autonomous Communities were collaborating in the formulation of the monitoring indicators which would determine this financing. The strategic objectives used to formulate the indicators were: improvement in the employability of young persons and support for entrepreneurship; improvement in the employability of other groups specially affected by unemployment (especially the long-term unemployed and workers over 55 years of age); improvement in the quality of vocational training for employment; and improvement in the linkage between active and passive employment policies.

Linkage between active and passive employment policies (activation). This was a question of reinforcing mechanisms designed to ensure that the recipients of unemployment benefits met their obligations relating to work and training in an appropriate and effective way. During 2012, the regulations on unemployment benefits and allowances were changed by introducing increased supervision of recipients’ compliance with their obligations, accrediting active job seeking and action to improve employability. The year 2013 would also see the introduction of innovative IT methods and tools which had proved effective in other spheres (taxation, social security, finance, etc.), as well as identifying possible sources of additional information with databases enabling the expansion and optimization of current procedures and improved detection of non-compliance with active job seeking and training obligations by benefit recipients.

Improvements in job placement services. With the aim of better matching employment supply and demand and facilitating actuation of the unemployed, the focus was being placed on measures intended to improve the quality of information and draw on the experience of private employment agencies. During 2012, the development of the Single Employment Portal had begun. This initiative, to be completed in 2013, consisted of the creation of a common database for the whole country which includes all training and employment offers managed by public, national and autonomous employment services, including European and international offers, those submitted directly by enterprises, public employment offers and those originating from other sources (such as employment agencies). Public–private partnership in the sphere of job placement services had been launched. A framework agreement had been established which had been adopted by the Autonomous Communities for the selection of job placement service providers. The aim was to ensure uniform conditions throughout the national territory to facilitate the coordination of the public–private partnership. Furthermore, the partnership will be results-based; in other words, private agencies would be remunerated according to the characteristics of the unemployed person and the duration of the employment provided. The Autonomous Communities (14 out of the 17) had expressed their willingness to adopt this public–private partnership model (Sectoral Conference of April 2013). The model was expected to be operational by the end of October 2013.

Increasing employment opportunities through training. In order to improve employability and integration into the employment markets, in particular for the youngest workers, the focus had been placed on training measures in 2012 and 2013. The objective was to provide training that facilitates access to the labour market, for which it was crucial for such training to be geared to the needs of the productive sectors. Moreover, it was important to promote training activities which also contained the possibility of gaining occupational experience. The labour market reform adopted in February 2012 had established a new training and apprenticeship contract leading to a vocational qualification. The regulations governing such contracts and their application had also been accompanied by the establishment of a dual system of vocational training, which was already operational, for which there would be a new development strategy for 2013–15. The strategy would be accompanied by a process for monitoring the quality and impact of dual vocational training, which would result in an intermediate evaluation (due in the second half of 2014) and a final evaluation (second half of 2015). In the context of social dialogue, the training round table was revising the training model for employed and unemployed workers, funded with public resources, which aimed to promote skills among training service providers and identify priorities in the productive sectors, so that more effective use was made of the public resources concerned. The new model had already become operational in 2012 and would continue in 2013. As part of the Youth Employment and Entrepreneurship Strategy 2013–16, negotiated with the social partners, measures had been adopted to improve the vocational qualifications and employability of young people: training programmes leading to certificates of vocational competence or promises of employment – at least 30 per cent of participants in such training programmes could qualify for such promises; incentives for unemployed persons to acquire compulsory secondary education; and a reform of the legislation relating to certificates of vocational competence would be conducted in 2013. In order to adapt these certificates to the new dual vocational training model, the basic legislation had already been amended and the National Directory of Vocational Competence Certificates would be published, and updated following the revision of 585 vocational competence certificates in 2012.

Promotion of youth employment and entrepreneurship. The Youth Employment and Entrepreneurship Strategy 2013–16, negotiated with the social partners, had been adopted and was being implemented. The objective was to promote measures to reduce youth unemployment, promote youth employment/self-employment, and it was the result of a process of dialogue with the social partners. It met the recommendations of the European Commission and was geared to the objectives of the “Youth Guarantee” proposal. The Strategy contained 100 measures, of which the following short-term measures deserved particular mention: to stimulate youth employment, contingency measures were being adopted (until the unemployment rate fell below 15 per cent); incentives for part-time employment linked to training for persons under 30 years of age without previous work experience and originating from sectors with no employment or those who have been unemployed for more than six months, counting both employment and training. Employers’ social security contributions were reduced by 75 per cent for enterprises with more than 250 workers and by 100 per cent for the rest; for the initial youth employment contract, strong incentives would be provided for conversion into indefinite contracts (€500 per year for three years and €700 for contracts for women); incentives for work experience leading to a first job would include changes to the current work experience contract so that trained young people could obtain a first job; other measures to promote entrepreneurship and self-employment for young people under 30 years of age; fixed social security contributions, with a minimum rate (€50) for the first six months of self-employment; combining unemployment benefits with starting self-employment for a maximum of six months; increased possibilities for the capitalization of unemployment benefits to start up entrepreneurial activities, so that recipients of unemployment benefits could capitalize up to 100 per cent of their benefits to contribute to the capital assets of a commercial company employing up to 50 workers, provided that there was an employment or professional link with the company; improved protection for the self-employed to facilitate a second chance, under which unemployment benefit could be paid again after a period of self-employment which ended before the fifth year; and establishment of the generations contract to promote the hiring of experienced unemployed workers by self-employed young people. In the Autonomous Communities, administrations which engaged in skills sharing with regard to active employment policies had been taking important action in 2012 and 2013 to increase the efficiency of such policies. The following actions could be singled out: giving priority to young persons in the action and modernization relating to public employment services through the restructuring of offices; improving personalized itineraries to employment and introducing new computer applications for the provision of employment services, guidance and placement in jobs; and the reinforcement of actions designed to ensure that the recipients of unemployment benefit take part in vocational training and guidance activities, with increased linkage between active and passive employment policies.

Education policies. The school drop-out rate in Spain was twice the European Union average, with the 2011 figures being 26.5 per cent for Spain and 13.5 per cent for the European Union. The same situation had persisted throughout the last decade, although the drop-out rate fell from 31.9 per cent in 2008 to 26.5 per cent in 2011. For 2012, the latest data from the active population survey for the last quarter of 2012 gave a figure of 24.9 per cent. Nevertheless, the school drop-out data contrasted with the percentage of persons between 30 and 34 years of age who had completed tertiary-level studies. The latter figure stood at 40.6 per cent, thereby exceeding the European target of 40 per cent, and continued the progress towards the national objective of 44 per cent by 2020. The main objective of the reform of education laws, which would begin in 2014–15, was to reduce the school drop-out rate to 15 per cent by 2020. This meant that 85 per cent of pupils were expected, under the proposed new education structure, to graduate from high school or complete intermediate or basic vocational training. The aim was for the educational reform to adopt measures, inter alia, to detect learning problems at an earlier stage and implement programmes for improvement, help pupils to follow the training path that best suited their profile, step up the volume of reading in key competencies for academic development and give greater autonomy to schools to develop educational projects geared to results. Furthermore, a new basic vocational training qualification would be created, which could be accessed without completion of compulsory secondary schooling, but which would continue to train the pupil concerned with a view to resuming such studies or moving on to intermediate vocational training. In addition, in 2012 two specific action plans for reducing the school drop-out rate had been launched. The first targeted the prevention of school drop outs and promoted a return to the school system, the second aimed to cater for the educational needs of the socio-cultural environment with an impact on school drop outs. Mention should also be made of: the assistance programme designed to allow unemployed young persons who dropped out of compulsory schooling to resume their studies; the new system of part-time work aimed at those who wish to combine work and training; the new training contract which makes it possible to obtain a vocational training qualification or a certificate of vocational competence; the improved access to vocational training studies through online learning; the revision of the content of various vocational training qualifications and certificates to adapt them to the new professional realities and needs of the productive sectors; the launching of a plan to boost lifelong learning; a policy of efficiency with regard to scholarships; and reform of university legislation to promote excellence, competitiveness and internationalization of the university system.

Employment policy results. According to data in the state employment service registers, the number of people unemployed at the end of May 2013 had fallen by 98,265 compared with the previous month. In relative terms, this was a 1.97 per cent decrease. In May 2012, the unemployment figure fell by 30,113 compared with the previous month. With this fall, the number of people who were registered as unemployed stands at 4,890,928, which was the biggest reduction in the registered unemployment figure in the month of May. In fact, the average drop in unemployment in the month of May since 1997 had been 54,450. This month, unemployment had therefore fallen by 43,815 more people than the average for the previous two months of May. These data clearly maintain the tendency towards a slowdown in the increase in registered unemployment, as since May 2012 the year-on-year rate had fallen by almost nine points, six this year, and now stood at 3.75 per cent. Thus, the increase in unemployment over the last 12 months has fallen below 180,000 (176,806), while in May the previous year, the year-on-year increase was over half a million (524,463).

Unemployment falling in all sectors and among young people. Among workers from the service sector, unemployment had fallen by 61,336 (1.97 per cent), among construction workers by 18,637 (‑2.51 per cent), in agriculture by 9,405 (-4.56 per cent) and in industry by 8,851 (-1.61 per cent). Lastly, among persons who had not been employed previously it had dropped by 36 (0.01 per cent). Unemployment had fallen among men by 61,150 (-2.48 per cent) compared with the month of April and stood at 2,405,493. It had also fallen among women by 37,115 (-1.47 per cent) and stood at 2,485,435. It should also be emphasized that, among young people under the age of 25, unemployment has fallen by 16,735 (-3.53 per cent) compared with last month. Among those aged 25 and over, it had dropped by 81,530 (-1.81 per cent). Registered unemployment among young people under the age of 25 over the past 12 months had dropped by more than 32,000 (32,317), which was a year-on-year fall of 6.59 per cent.

Reduction in 16 autonomous communities. Registered unemployment fell in 16 Autonomous Communities, including in particular Andalucía (26,529), Catalonia (-14,829) and the community of Valencia (-10,671). It rose, however, in the Canary Islands (538). As for data by province, unemployment fell in 47 provinces, and particularly Barcelona (-8,655), Madrid (-8,470) and the Balearic Islands (-7,917). It rose, by contrast, in five, headed by Las Palmas (309) and Tenerife (229).

Recruitment on the rise. In May, some 1,283,261 recruitments were registered, representing an increase of 36,160 (2.90 per cent) on May 2012. Cumulative recruitment in the first five months of 2013 reached 5,457,691, which was an increase of 85,079 (1.58 per cent) on the same period the previous year. Positive developments had been seen in the training and apprenticeship contracts, as there had been 67 per cent more persons recruited under those contracts in 2013 compared with the same period last year. In May, some 7,220 new “support for entrepreneurs” contracts had been reported to the public employment services, which represent 21.7 per cent of all the open-ended contracts of that type that had been reported.

Unemployment benefits. Some 871,504 cases of unemployment benefit were processed in April 2013, which was an increase of 4.2 per cent over April 2012. The total number of beneficiaries at the end of the month was 2,901,912, a reduction of 0.7 per cent on the same month the previous year. The unemployment protection system achieved coverage of 61.28 per cent, whereas the same indicator stood at 65.45 per cent in April 2012, which was a fall of 6.4 per cent. Total expenditure in April 2013 had been €2,556 million, which was 2.5 per cent less than in the same period the previous year.

In addition, before the Committee a Government representative said that the Government was jointly responsible for policies implemented by the European Union. In late 2011, the Government had found itself faced with an international crisis aggravated by the structural characteristics of the labour market and the national economy. The first measure taken was to begin labour reforms, with the aim of building flexible industrial relations to mitigate job losses and introducing new measures to promote the recruitment of people who had difficulties accessing the job market. The reform had three main components to promote sustained economic recovery and generate employment: fiscal consolidation; the achievement of deficit goals; and the restructuring of the financial system. As a result, the labour market and enterprises had become more flexible. In addition, the Government was according special importance to active employment policies that were managed in collaboration with the Autonomous Communities.

The Government was committed to laying the foundations for a solid economic recovery that would enable Spain to get back on the road to creating stable, quality employment. That was the country’s key target and the main objective of the reform agenda. In conclusion, he said that the policies adopted would allow for sustained economic growth and employment generation, especially for young people, who were the Government’s main concern.

The Worker members recalled the relevance of the Convention in the context of the crisis currently faced by Europe, where to cope with the situation many countries were pursuing policies of austerity, revising their labour legislation to make their labour markets more flexible or drastically reducing public expenditure so as to obtain financial assistance from the “Troika” – the European Central Bank (ECB), the International Monetary Fund (IMF) and the European Commission. In the present case, the Committee was called upon to examine how Spain was reacting to the crisis in the light of ILO standards, and notably Convention No. 122. It highlighted the dilemma that existed between the commitments that States entered into vis‑à‑vis the ILO standards that they had ratified and the mechanisms that were in force in the European Union. In its report on its application of the Convention, the Government referred to the European Employment Strategy. Although the European Commission did not appear to take fundamental labour rights into account in its instructions to Eurozone countries, the ILO had nevertheless succeeded, in its contacts with the ministers of labour of the G20 countries, in gaining acceptance for the Global Jobs Pact and for the Decent Work Agenda as tools that could help countries overcome the crisis and create jobs. In analysing the case before the Committee, the conclusions adopted at the Regional Conference in Oslo, which had brought together European governments and the social partners, should be duly taken into account.

The Worker members criticized some of the measures taken by the Government to introduce more flexibility into the labour market and thus create a favourable climate for job creation, as they were not an adequate response to the crisis. They referred specifically to the adoption of a new type of contract comprising a one-year trial period during which the contract could be broken without payment of any compensation, the extension of grounds for dismissal, the suppression of administrative authorization for collective dismissals, the priority given to enterprise agreements over sectoral agreements and the greater facilities accorded to employers to modify employment contracts unilaterally. Those measures were accompanied by significant cutbacks in public expenditure, which had an impact on wages, social benefits and, in some sectors, employment. The trade union federations had denounced the absence of social dialogue and non-compliance with the agreements reached in the context of the Second Agreement on Employment and Collective Bargaining concluded in January 2012. All of those measures had been counter-productive in economic terms, as they had deepened the recession and increased the public deficit. In the first quarter of 2013, unemployment had risen to 27.1 per cent (compared with 26 per cent in the third quarter of 2012), while, among young people, it had reached 57.2 per cent and, among migrant workers, 39.1 per cent. Also in the first quarter of 2013, the share of temporary employment was 22 per cent (in 90 per cent of the cases concerned, that type of employment was by choice) and the number of people with no income from employment was 1.5 million, 800,000 more than in the first quarter of 2007. The figures showed that the steps taken had not resulted in the creation of productive and lasting employment and, consequently, did not meet the requirements of Articles 1 and 2 of the Convention. The Worker members also doubted the effectiveness of the measures adopted to combat precarious employment and unemployment and in relation to other aims of the Convention. They concluded by recalling that unemployment among young people affected a large number of highly skilled workers. It was therefore essential that the Government submit a report in 2013 on the application of the Human Resources Development Convention, 1975 (No. 142), with information on the steps taken in collaboration with the social partners to ensure that the vocational guidance system corresponded to the skills requirements of the most vulnerable workers and of the regions that had been hit hardest by the crisis.

The Employer members emphasized that Spain was the country that had ratified the largest number of Conventions, which showed how ready and able it was to collaborate with the ILO. The Committee had twice analysed the situation in Spain as it related to the Convention which, as a governance Convention, was inter-related with many other instruments that aimed at ensuring that active employment policies were consistent with the full exercise of workers’ rights. Moreover, the economic crisis in Spain was being analysed by various ILO supervisory mechanisms: a complaint before the Committee on Freedom of Association, a representation concerning non-compliance with the Termination of Employment Convention, 1982 (No.158), and the discussion in the Conference Committee. The situation should be examined from a single perspective. In the opinion of the Employer members, the Government had provided a clear explanation of the active employment policies which it was obliged to implement under the Convention. It should be emphasized that the Convention had been adopted at a time of economic growth with no consideration of times of crisis. However, the comments of the supervisory bodies, and notably the General Survey, had taken the situation into account and indicated that exceptions to social dialogue and collective bargaining were acceptable in times of grave economic crisis. In addition to active employment policies, monetary and fiscal measures had to be adopted to generate employment and the necessary climate of confidence for investment. Moreover, the Convention had been adopted at a time when the taking of decisions was the prerogative of each State, whereas today the world was divided into blocs. Spain was part of the European Union, and therefore the measures it took had to conform to its obligations vis-à-vis the Union. They concluded that, from the information supplied by the Government, Spain’s implementation of the provisions of Article 3 of the Convention was satisfactory.

A Worker member of Spain emphasized that the country was going through one of the worst situations since the establishment of democracy, a situation that the trade unions had described as a “national emergency”. In addition to the dramatic data, what was surprising was the Government’s attitude of insisting on the same policies that had brought about this social disaster. Far from resolving the crisis, austerity policies and cuts had made it worse. Although the Government was stating that labour reform provided a framework that was conducive to the creation and maintenance of jobs, the data showed that the reform, in one year of operation, had caused job losses and increased precariousness. In bailing out the financial institutions, the Government was using resources that would be much better employed for protecting the people who had been impoverished by its social and economic policy. Nor were the prospects very optimistic since the OECD was expecting the unemployment rate to rise to 28 per cent in 2014. Moreover, the latest reforms had been accompanied by a disregard for democratic procedures. Neither in the labour reform nor in other economic measures adopted with a major impact on employment had the Government left the trade unions space for negotiation, breaking with a rich tradition of social dialogue which had made Spain a model of dialogue. The Convention imposed on States the legal obligation to pursue an active policy designed to promote full employment, to consult the social partners and to periodically review and evaluate the effectiveness of the measures taken. None of those obligations had been met. The sole priority for the Government was to reduce the deficit, ignoring the ILO’s recommendations. Workers regretted that the Government had not asked the Office for technical assistance. It was to be hoped that it would not take another year for measures to be adopted.

Another Worker member of Spain said that, according to a survey, 27.16 per cent of the active population, and over 57 per cent of workers under 25 years of age, were currently unemployed. That was the net result of the first year of labour reform imposed by the Government in 2012 without any negotiation or consultation with the social partners. The reform had two objectives: first, to facilitate the dismissal of workers and reduce labour costs and, second, to undermine collective bargaining and the legal force by collective agreements. Inevitably, the outcome was to cause a further increase in unemployment and to accentuate the impact of the recession, since both factors tended to reduce domestic demand. Austerity policies and structural reform were simply a means of taking away people’s rights and social benefits and had failed to help the most indebted countries to reduce their deficits to any significant degree. On the contrary, they had generated a profound political crisis in the European Union that was developing into a crisis of legitimacy of its institutions, since governments were being obliged to take decisions through undemocratic procedures on vital issues that were not within the purview of the Union. That was what the 2012 labour reform had done in Spain, when by legislative decree the Government had allowed for employers to amend a collective agreement unilaterally which had been negotiated with its social partners. The ILO’s fundamental Conventions were no longer being respected and the policies pursued were destroying jobs. Employment could only grow and jobs be created, especially for young people, by means of investment, the financing of enterprises and families, and the stimulation of demand. The workers wanted democratic policies and institutions to which everyone contributed, in order to enhance the well-being of the immense majority who needed economic growth, employment, equality, social justice and the redistribution of wealth.

The Employer member of Spain emphasized that companies and business organizations had been demanding reform of the labour legislation long before the economic crisis had hit. Spanish companies had already been experiencing lower levels of productivity and competitiveness than neighbouring countries, in particular owing to the very rigid labour legislation, as demonstrated in the recruitment and dismissal system, and to an inflexible collective bargaining regime. Alongside the enormous problem of unemployment, hundreds of thousands of businesses had closed and disappeared. Although social dialogue was the best way to achieve agreement between all relevant parties, it was not always essential and was not necessarily the only solution. She made reference to the Agreement on Employment and Collective Bargaining that had been signed by entrepreneurs and trade unions in January 2012, and the approval shortly afterwards of labour market reform measures that had failed to take the Agreement into consideration. Since the democratically elected Government was always ultimately responsible for the country’s economic policy, it was understandable that, given the circumstances, the Government was forced to treat labour market reform measures as an urgent matter. In order to ensure positive results, the new regulations should go hand in hand with additional measures in the area of employment and other structural reforms that would, inter alia, facilitate the balancing of public accounts and improve the business environment. In the years prior to the crisis, the budget to fund active employment policies had been increased, but the desired results had not been achieved, and business organizations had constantly demanded a rigorous assessment of their effectiveness. She added that a process of dialogue on vocational training for employment was under way and emphasized that it was one of the basic pillars for the competitiveness of businesses, for maintaining and creating jobs and for the employability of workers. Given the short time that had passed since the introduction of the measures that had been adopted, the results could not yet be evaluated as regarded a consolidated positive tendency. Nonetheless, encouraging signs were beginning to show. While even business organizations had indicated that it was necessary to continue moving forward through dialogue and consultation, that was not an attempt to diminish the Government’s political legitimacy to fully exercise its legislative powers. No Government should be limited, or politically conditioned, by social dialogue. There was no doubt that social dialogue processes and the main stakeholders needed to adapt to the new requirements imposed by the realities of the ongoing crisis. The important role played by social dialogue during the decades in which numerous rights had been granted should mean that there was a greater requirement for responsibility when joining efforts to overcome difficulties.

The Worker member of Germany, also speaking on behalf of the Worker member of France, expressed great concern at the reforms pursued by the Government under the aegis of the European austerity policy, considering that these reforms in particular, and the European austerity policy in general, constituted a serious attack on social Europe. With reference to Article 1 of the Convention, which provided that each Member shall declare and pursue, as a major goal, an active policy designed to promote full, productive and freely chosen employment, he emphasized that in Spain employment was not being promoted, but rather destroyed. The rise in unemployment, particularly youth unemployment, had led to a substantial weakening of workers and unions, and was being used to implement a radical restructuring of European labour market institutions at the national level, a development that he firmly condemned. The tough cost-saving policy intended to overcome the crisis had plunged Europe back into recession in 2012. The austerity policy pursued in Spain had entailed far-reaching changes in collective bargaining, as ever more radical neoliberal labour market reforms had been calling into question sectoral and national collective agreements. For example, Decree No. 3/2012 established that collective agreements at the enterprise level took precedence over sectoral collective agreements. He expressed concerns about the fact that the Decree weakened sectoral collective agreements, and thereby trade unions. In Spain, the high unemployment rates and Government-enforced pay cuts had resulted in a decline in consumption. The consequences of the reforms in Spain and the European austerity policy had had devastating consequences in Spain and other countries, including Germany and France. He emphasized that the crisis could not be overcome by neoliberal reforms pushed through by the State, but rather through social dialogue and the increased involvement of trade unions. Growth could only be created by strengthening social cohesion.

The Government member of France, speaking also on behalf of the Government members of Cyprus, Germany, Greece, Italy and Portugal, staid that these Governments had embarked upon a joint coordinated effort to combat unemployment, especially among the young, and wished to express their solidarity with the Government of Spain in all it was doing to that end. He drew the Committee’s attention to the exceptional situation of Spain and to the determination of the Governments to combat the effects of the crisis. He reaffirmed the attachment of the Governments to social dialogue and to active policies for productive and freely chosen employment and was confident that the Government of Spain would pursue its efforts in keeping with the values and principles of the ILO.

An observer representing the International Trade Union Confederation (ITUC) said that, on the basis of data provided by the Government, 1,800,000 jobs had been destroyed in just two years. On the one hand, the Government had indicated to the ILO that it was expecting the GDP to rise by 4.5 per cent and unemployment to fall by 3.2 per cent. However, the Government’s own data, supplied by the Council of Ministers, predicted a 25.9 per cent unemployment rate by the end of 2015. This meant that, even in the best case scenario, the Government’s policies presumed that Spain would have around 6 million unemployed workers within the next 30 months. He believed that the Government’s employment policy was the product of its obsession with budgetary consolidation, while completely overlooking the most elementary principles of social justice, and that its labour reform would go down in history as the labour relations measure that had destroyed the largest number of jobs. He compared the situation of the hundreds of thousands of young people who had already emigrated or would soon have to do so with that of those who had done so in the post-war era.

Another observer representing the ITUC said that many States, and in particular international credit agencies, insisted on saying that reforms were necessary to return to the path of growth and employment creation. However, the experience of Latin American countries indicated precisely the opposite: adjustment policies magnified pro-cyclical effects, deepened the recession and hampered any recovery in employment. The similarity between what was currently being imposed on countries such as Spain and what had been implemented in Latin America was alarming. Spain’s labour reforms showed utter disregard for democratic mechanisms and broke with the commitments that had established close ties of communication and social dialogue. He recalled that the Committee would soon discuss the case of progress of Iceland, where the financial sector had not been the primary recipient of rescue packages. Lastly, he considered that what was being witnessed was the exhaustion of the credibility of the adjustment discourse, and that workers were no longer willing to continue paying the price for a speculative feast divorced from the real economy.

The Worker member of Brazil considered that what was happening in Spain constituted a significant step backwards in both political and social terms. There had been a huge decrease in the number of jobs and the unemployment rate had reached record levels, principally affecting young people and immigrants. While the Convention was general in nature, there could be no doubt about the meaning of its provisions. The policies of member States needed to promote full, productive and freely chosen employment. Moreover, the social partners had to be involved in developing and implementing such policies. Workers had not been responsible for causing the crisis, but they were the ones who were paying for it, while entrepreneurs were reaping the benefits. The question arose as to whether fiscal austerity and greater flexibility of rights had ever lifted a country out of crisis; on the contrary, such policies were leading to a greater concentration of wealth. He questioned the Government’s position, stressing that the worker’s interests should also be taken into account. He considered that only counter-cyclical policies could mitigate the social effects of the crisis and create the space in which to overcome it, giving the example of the policies in Brazil under the Lula administration. He maintained that Spanish trade union federations should be an integral part of the search for solutions, and should not be excluded from the negotiations on reforms and employment policies.

The Worker member of the Bolivarian Republic of Venezuela referred to the considerable loss of purchasing power, which had been a result of reductions in wages and the increase in the cost of living. Labour reforms had used the situation of austerity as an excuse to reduce severance pay, make dismissals and unilateral amendments to working conditions by the enterprise even easier, and distort collective bargaining by allowing for the non-application of collective agreements. Income from capital had, for the first time, exceeded that from labour. She expressed concern at the situation in Spain, which amounted to a violation of the Convention, particularly as regards the participation of employers’ and workers’ representatives in formulating employment promotion policies. Labour reforms had transformed labour into a commodity by imposing reductions in wages, changes in working conditions with little reason or need, and quick low-cost dismissal procedures. She requested the adoption of the measures requested by the Worker members.

The Government representative welcomed all the comments made, especially the words of support from the Government member of France on behalf of a large number of European Union Member States. He reiterated his Government’s stance in defence of its reforms, which were essential to return to employment generation. He particularly emphasized the effectiveness of the labour reform which had been adopted by Royal Decree, in view of its urgency, and later ratified by Act of Parliament. Encouraging the internal flexibility of enterprises would help to generate employment. The structural problems that had characterized the Spanish economy in the past, such as an unemployment rate far exceeding the European average at a time of economic growth, were unsustainable. Structural unemployment was the product of an inflexible labour market. The labour reform would push the GDP growth threshold down to 0.7 per cent to generate employment. He recalled that, although huge amounts had been allocated to employment policies in the previous decade, unemployment had not only not stabilized but had actually increased, as there had been no incentive for those policies to be effective. He believed that the way ahead lay in introducing rationalization criteria and evaluating the results. He added that it was important to pursue the reforms as the only way to generate stable and sustained employment. The reform process should be underpinned by social dialogue, a key tool for achieving the objective. He referred to the initiatives in 2013, such as the signing of an agreement resulting in the Youth Employment and Entrepreneurship Strategy and the establishment of a round table for a new agreement on vocational training for employment. Recalling that participation by the social partners in employment policy-making bodies was institutionalized, he reiterated the commitment of Spain, which had ratified more Conventions than any other country, to the ILO supervisory mechanisms for international labour standards.

The Employer members had noted the information provided by the Government and of the ensuing debate. They felt that the obligation imposed by the Convention should be understood as corresponding to the level of economic development of each State and of the relationship between its employment goals and the other economic and social objectives. They believed that the content of a Government’s active employment policies depended on the specific characteristics of each State. They therefore considered that it was not for the Committee to decide on the content and implementation of those policies. According to the Convention, consultations on those policies should be conducted with the social partners so as to benefit from their experience and views and to reach agreement on policy changes. Recognizing that broad consultation on active employment policies was normal, they considered that, when faced with the serious and insurmountable problem of having to save jobs, enterprises and institutions, as was the case in Spain, it was acceptable to adopt exceptional measures, within the context of social dialogue and existing domestic legislation. They agreed with the requests made by the Committee of Experts for information from the Government.

The Worker members emphasized that the ILO could not turn a blind eye to the dramatic situation affecting Spanish workers and threatening European workers in general. Waiting another year or two to act would merely aggravate matters. In the context of the Convention, examining data on unemployment fell well within the competence of the ILO supervisory bodies. The Committee of Experts should also assess the impact of macro-economic policies in order to ensure that they met the requirements of the Convention, and particularly Article 1(3). In that regard, they urged the Government to provide relevant and up-to-date information in light of the aims of the Convention so that its employment policy could be examined, taking into account the application of its economic and budgetary policies. Furthermore, the Government, in conjunction with the social partners, should evaluate the results of its employment policy and amendments already made to labour market legislation and seek the widest possible consensus with the social partners to prepare an ambitious employment plan. Deploring the total breakdown in social dialogue, they also urged the Government to re‑establish constructive dialogue with the social partners, in accordance with Article 3 of the Convention, and proposed a high-level technical mission to assist in implementing these requests.

Conclusions

The Committee took note of the detailed written and oral information provided by the Government representative and the discussion that followed.

The Committee noted that the issues concerned the deterioration of the labour market situation in the context of the adjustment measures implemented to deal with the debt crisis in the Eurozone, the difficulties with respect to social dialogue, the increasing youth unemployment and long-term unemployment and the need to ensure that educational policies met employment needs and the needs of the workers affected by the crisis.

The Committee noted the comprehensive information provided by the Government on the active labour market measures it was implementing on the economic and employment strategy adopted in the context of the European Union to tackle unemployment and the social consequences of the crisis. The Government stressed its commitment to social dialogue in order to overcome the crisis. The 2012 labour reform provided for internal flexibility measures to enable enterprises to adapt to the current economic circumstances. The new strategy also included specific measures to reduce the youth unemployment rate, strengthen public employment services and the intervention of private placement agencies, and further coordinate between the national and regional authorities to attain a better balance in the labour market.

The Committee noted that the Preamble of the Convention stated that, under the terms of the Declaration of Philadelphia, it was the responsibility of the International Labour Organization to examine and consider the bearing of economic and financial policies upon employment policy in the light of the fundamental objective that “all human beings, irrespective of race, creed or sex, have the right to pursue both their material well-being and their spiritual development in conditions of freedom and dignity, of economic security and equal opportunity”.

The Committee considered that the outcome of the Ninth ILO European Regional Meeting was relevant to this case. It noted that the Oslo Declaration “Restoring confidence in jobs and growth” stated in particular that fiscal consolidation, structural reform and competitiveness, on the one hand, and stimulus packages, investment in the real economy, quality jobs, increased credit for enterprises, on the other, should not be competing paradigms.

The Committee expressed its concern at the persistent deterioration of the labour market and urged the Government to continue evaluating, with the participation of the social partners, the impact of the employment measures adopted to overcome the current job crisis. The Committee requested the Government to pursue, as a major goal, an active policy designed to generate sustainable employment opportunities, particularly for youth and other categories of workers affected by the crisis. The Committee requested the Government to increase its efforts to strengthen social dialogue with a view to maintaining a favourable climate for employment creation and achieving better results in the labour market. The Committee noted that the Office could contribute, through technical assistance, to promoting a sincere and constructive social dialogue among all the parties concerned to address the labour market situation in the context of Convention No. 122.

The Committee requested the Government to provide a report for the next meeting of the Committee of Experts with updated information regarding the application of the Convention.