Cash for companies which cut working hours for same wages

SMALL and medium-sized businesses will get up to €150,000 if they reduce staff's working hours by at least 10% without cutting their salaries, as long as they keep the new system in place for a minimum of two years.

The ministry for industry and trade launched a public consultation at the beginning of summer with a view to shortening the standard working week to four days, and launched a pilot scheme in which smaller companies would get paid to do so.

A deal struck when debating the 2022 State budget has led to €10 million being set aside – independent party Más País, a breakaway group of left-wing Podemos run by former member Íñigo Errejón, said it would vote in favour if funds were set aside to study the feasibility of reducing Spain's working hours to a typical 32 a week.

At present, a standard working day in Spain, net of breaks and lunch, is eight hours, meaning a 40-hour week over five days, and anything less than this is considered a part-time job.

Cutting staff's workload by 10% to qualify for the €150,000 would mean a 36-hour week on the same pay as for 40 hours, although firms are encouraged to reduce time spent on the job by 20%, giving a four-day week of eight-hour days.

At present, around 60 or 70 small and medium-sized companies are expected to qualify for the €150,000 bonus, although Más País believes up to 160 firms may apply, benefiting over 3,000 employees.

The aim of this exercise is to increase productivity, since studies have shown that staff are physically and mentally healthier if they have more free time and a better work-life balance, and it would also encourage gender equality – women are statistically more likely to take on the bulk of care duties, which are easier to juggle over four days a week than five.

As well as reducing the working week, businesses eligible for the €150,000 bonus will be required to incorporate organisational strategies, staff training, and efficient procedures, to ensure productivity does not decline through employees spending less time at work and to compensate for maintaining their pay levels.

The government cash is aimed at helping with any costs incurred initially as firms get used to a shorter week and for their setting up new processes and training.

These costs could include supplementing salaries, taking on management consultants to aid the process, or funding courses for employees.