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CEOE rejects the latest union proposal to raise wages for the next three years | Economy

The president of CEOE, Antonio Garamendi, this Friday at an event in Valladolid.
The president of CEOE, Antonio Garamendi, this Friday at an event in Valladolid.NACHO GALICIAN (EFE)

The Spanish Confederation of Business Organizations (CEOE) has rejected the latest proposal presented by the unions to renew the Agreement for Employment and Collective Bargaining (AENC), considering that “it contributes to the second-round inflation that the official organizations”. With this refusal, the possibility that representatives of workers and employers define a path of wage growth for the next three years with which to face the rise in prices is removed.

The UGT and CC OO unions defined a new framework for increases for the triennium 2022, 2023 and 2024, and also extended it until 2025. According to this approach, to which EL PAÍS has had access, this year wages would face a rise in 3.4%, which would be lowered to 2.5% in the following, although an additional half point could be added to compensate for the average annual inflation of 2022. In 2024 something similar would happen, starting from a rise of 2%, which, in this case, it would increase by 0.25%. In 2025, the percentage would result from the sum of the CPI for December 2024, plus an additional 0.25%.

During this Friday’s meeting, in which the general secretaries of the employers’ associations that make up the employers’ representative body have participated, the projections they have made for the next three years, both the Bank of Spain and BBVA, together with those prepared by the CEOE itself. In them, the resulting average indicates that prices will rise in 2022 between 7 and 7.5%; in 2023, between 2 and 2.5% and in 2024, 2%.

The CEOE considers the unions’ proposal “unacceptable”, arguing that this permanent review of the percentages that would be carried out with the incorporation of a clause, would contribute to the assumption of temporary inflation as definitive, and, therefore, would give rise to to the feared “second round inflation”, which organizations such as, precisely, the Bank of Spain are warning about. “Unless the contrary is decided, the CEOE cannot sign the AENC”, recognizes a source present at the business meeting.

The blockade, therefore, is maintained, and it is seen as a closer possibility that unions and employers do not reach an agreement to define the framework that should serve as a guide for future collective negotiations. This circumstance would prevent the existence of guidelines to protect them in the midst of these processes, which could give rise to disparate resolutions. In order for this not to happen, the businessmen’s approach would pass through a series of recommendations to establish the increases, which would take as a reference the evolution of underlying inflation, that is, the one that does not take into account energy prices, nor that of unprocessed food products.

Red lines

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The unions have set as a red line the defense of the purchasing power of the workers, for which they consider it essential to shield their salaries against inflation. This can be done in various ways: the first is by establishing a salary update clause, that is, the one that would enter at the beginning of the year in response to the increase in inflation; or through review clauses, which are retroactive, and therefore, in addition to updating salaries, they are also fed back with what was lost in the previous year.

These two possibilities are not accepted by businessmen, who defend that the situation of companies is compromised by the increase in energy costs, and they do not have the capacity to face these rises. The Bank of Spain is also opposed to these formulas, and the governor of the supervisory body, Pablo Hernández de Cos, has suggested that salary increases should be made over several years and excluding energy prices from the references.

Sources familiar with the negotiation acknowledge that a new meeting between social agents has not been called, although they assure that it is very likely that contacts will be maintained in the coming days, despite the proximity of the Easter holiday. They appeal to the fact that the impossibility of signing an agreement would suppose the rupture of the social peace that “society demands so much at the moment”.

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