Severance pay

[Pesky Wesky]

Originally Posted by Stravinsky

In Benelux countries its more normal to offer contracts, often lasting only 6 months. In that way the companies escape the risk of redundancy ... I guess thats the price the people pay for high redundancy costs!

Isn't that one of the problems in Spain, that people are given a series of 3 month contracts until they can't legally do it any more and then they get another person to do the same job?? Or is that supposedly illegal now?
In one company that I've been going to for 6 years they've had at least 8 receptionists, if not more...

[mrypg9]

Originally Posted by maxd

Well, how about also collecting for the VAT man, paying business taxes on top social payments as well + paying for licences that the city hall keeps on inventing. Etc Etc.

Actually, you are right we only found out about Spanish severance when the downturn came. Also our Spanish MD was not very thorough when he started offering ever fekka...err I mean valued employ a full time contract. He has now gone and we are left to clean and pay for the peices. The joys of being a business owner I guess.

So, if anyone knows how we can weasel out of it, instead of discussing social policy, please let m know

Oh dear, maxd, we seem to be going through a bad patch. It seems you didn't do your homework very thoroughly. Surely as a business owner you should have carefully scrutinised the employment regulations before you dipped your toes into Spanish waters, so to speak. As an internet trader operating in several states surely you checked out EU rules and regulations before setting up offshoots in Spain and elsewhere?
If you have time on your hands in future you could perhaps do a little reading in political theory and economy. How on earth any one can describe the UK as 'socialist' is beyond me. Tony Blair's Government faithfully followed Tory spending plans for its first term. It gave independence to the Bank of England - a neo-con policy if ever there was one. PFI socialist??? Almost complete lack of financial regulation socialist?? Removing the 10% tax band socialist?? You are probably unaware that the tax burden on most ordinary families was higher at the end of the Thatcherite period of Government than at the start. I''m sure that you don't know that the first sell-off of state assets took place under the Labour Government of James Callaghan when Dennis Healey sold off British Petroleum.
As for the welfare claimants you rightly complain about: the percentage of workless households increased from 6.5% in in 1975 to 19.1% in 1994. Between 1995 and 1997 there was an increase of 15% in the number of unemployed lone parents.
We have the neo-liberal Tories to thank for the growth of our dreadful underclass. It would seem that under Cameron, the Tories are at last reverting to the 'one-nation' philosophy of Conservatism which served the country well for many prosperous decades.
EU states such as Denmark, Norway, Germany and France are much more 'socialist' (as you would presumably see it) in their tax and benefit structures. The first two especially are high tax, high wage, high social benefit economies. Their inhabitants enjoy a very high standard of living and good quality of life.
We too were owners of a medium-sized concern in the UK, as you know. We too moaned about taxes, about all the red tape and regulations, about the difficulties of recruiting and retaining a highly-qualified and motivated work force. But we paid our taxes, remunerated our employees well and invested in new plant and equipment to improve our profitability. Yes, we paid a great deal in taxes etc . but we nevertheless managed to accrue sufficient funds when we decided we'd had enough of working to be able to live a good life before we were too old to enjoy it.
The difficulties you are currently dealing with are part of the normal course of business life. How you deal with them will depend on your expertise and experience. If you are planning for long-term success, you will have to contribute as well as take. That's how successful businesses flourish and stay in business.
Ranting on about what you mistakenly perceive to be 'socialism' won't improve matters. The current UK Government is not 'socialist' - it is merely appallingly incompetent and thankfully won't be around much longer.
Attack it for what it is, not what it isn't.
And anyway, if all fails, remember you are living in Prague and can live to a higher standard there on much less than in the UK. Life must be even better in Bulgaria or Romania for a recipient of funds in euros or even sterling.
Although that's not enough to tempt me back there..
And just a thought: how is doing all in your power to evade paying business taxes whilst enjoying the infrastructure provided from state funds different in moral character from attempting to obtain benefits to which you are not entitled?

[mrypg9]

Originally Posted by maxd

So, if anyone knows how we can weasel out of it, instead of discussing social policy, please let m know

'Weasel out of it'??? You mean, how can we bend or break the law to avoid our responsibilities? And you are talking about 10k euro here, not megabucks.
Come on, maxd, you are behaving like a benefit cheat.
Respectable businesspeople operate within the law and are careful to maintain a reputation for trust and probity. The way you treat your employees will affect your reputation with your customer base.
If there are legitimate ways to avoid your responsibilities as an reputable employer, surely your lawyer would have advised you by now?

[mrypg9]

[QUOTE=maxd;202881]

Actually, you are right we only found out about Spanish severance when the downturn came. Also our Spanish MD was not very thorough when he started offering ever fekka...err I mean valued employ a full time contract. He has now gone and we are left to clean and pay for the peices. The joys of being a business owner I guess.

QUOTE]

I've just come in from an afternoon lying by the pool, read this through again...and I'm a bit taken aback on a second reading.
What about the responsibilities of being a business owner, maxd?
And how did you come to employ a 'Spanish MD' who had no knowledge of basic employment law? An MD who is ignorant of basic stuff such as this?? What kind of experience do you expect your key employees to have had? What qualifiications?
I have nothing to do with business nowadays, but even I know, from talking to Spanish friends who are in business, that Spanish law requires payment of twenty days for each year worked in cases of redundancy.
As for your cleaners....on permanent contracts??? For how many hours???
As a one-off special offer, I will consider running your Spanish operation for a reduced salary seeing as how I'm not looking for work...say £80k p.a.? I couldn't do a worse job than your former Spanish 'MD'.
I'm surprised Sue Neil hasn't commented on your request for ways to 'weasel out' of your obligations. She was herself made redundant a week or so ago.
This forum isn't like expats.cz, max. Most people who post here are solid types, many retired business people, some HNWIs. Not many hard-up 'English teachers' living half-a-dozen to a flat and constantly on the lookout for money-saving ideas, whether buying second -hand knives and forks. or going to Germany to buy groceries to save a few crowns.
The last time I looked at expats.cz there was a long post about 'sticky toilet bowls'. Says it all..

[JBODEN]

mrypg9: I smell ears burning!

[maxd]

mrypg9, People make stupid decisions without our knowledge. Happens all day every day here, there and everywhere. I am sure you have made your fair share of dumb ones in your time too.

Cleaners are on full time contracts because OF THE SPAINISH LAW. We want reliable people who do not steal from us or our guests and changing them every few momnths does not instill a sense of loyalty. Like I say, they have seen nice redundancy pay now from others and are being cheeky so they can have a peice of that too.

Do not see your point? We give our managers a lot of autonomy and on one had we have peace and quiet but on the other we are open to them messing up. It is easy to say sitting in your armchair in Marbella that things should have been done differently.

[Xose]

Originally Posted by maxd

mrypg9, People make stupid decisions without our knowledge. Happens all day every day here, there and everywhere. I am sure you have made your fair share of dumb ones in your time too.

Cleaners are on full time contracts because OF THE SPAINISH LAW. We want reliable people who do not steal from us or our guests and changing them every few momnths does not instill a sense of loyalty. Like I say, they have seen nice redundancy pay now from others and are being cheeky so they can have a peice of that too.

Do not see your point? We give our managers a lot of autonomy and on one had we have peace and quiet but on the other we are open to them messing up. It is easy to say sitting in your armchair in Marbella that things should have been done differently.

SPANISH LAW ?! You're having a bubble mate!! The gross margin you mean.

Ever heard of Adecco?!!

I know several companies who's core team is about 10% of their peak headcount. They take the contract (cleaning personnel is one of the types, cable jockeys etc., etc.) and hire temp agency people.

Guess what though - the margin's aren't quite the same. But then you'd know that, wouldn't you?!

Out of control rapid expansion is one of the most common causes of positive book/negative cash flow failures. In any country, get it wrong, you go down. It's the capitalist way you are obviously so fond of.

[maxd]

Originally Posted by Xose

SPANISH LAW ?! You're having a bubble mate!! The gross margin you mean.

Ever heard of Adecco?!!

I know several companies who's core team is about 10% of their peak headcount. They take the contract (cleaning personnel is one of the types, cable jockeys etc., etc.) and hire temp agency people.

Guess what though - the margin's aren't quite the same. But then you'd know that, wouldn't you?!

Out of control rapid expansion is one of the most common causes of positive book/negative cash flow failures. In any country, get it wrong, you go down. It's the capitalist way you are obviously so fond of.

Agencies workers are unreilable. Once you have trained them they leave and you start again. Then you go in a circle. We needed reliablity. Now we get opportunism. Being rude, turning up late etc and something really really bad that I cannot go into here. You can sack them but that is what they want. Who can blame them, the system gives 45 days for every year worked.


Check this calculation out. Spain is 5 times the UK:

Based on minimum statutory paid notice and severance pay for a white-collar employee aged 40, made redundant after 10 years on a salary of £20,000, the average redundancy pay across the EU was £11,163.


But using the same comparison the redundancy pay would be just £5,000 in France and the Netherlands and £5,128 in the UK. In Spain and Italy the payment would be £25,464 and £18,276 respectively, and £15,000 for both Belgium and Austria



I know you do not care but imagine a company is burning cash in the recession now, and a lot are. To be strong and survive you need to cut down your labour force but the law says you have to pay mega bucks to get rid of them. The result is downsizing will kill you.

Luckily, we are not in that situation but A LOT of Spanish companies and all the talk of labour reform is just hot air but in the end Spain is going to a lot worse place for it.

[mrypg9]

Originally Posted by maxd

mrypg9, People make stupid decisions without our knowledge. Happens all day every day here, there and everywhere. I am sure you have made your fair share of dumb ones in your time too.

Cleaners are on full time contracts because OF THE SPAINISH LAW. We want reliable people who do not steal from us or our guests and changing them every few momnths does not instill a sense of loyalty. Like I say, they have seen nice redundancy pay now from others and are being cheeky so they can have a peice of that too.

Do not see your point? We give our managers a lot of autonomy and on one had we have peace and quiet but on the other we are open to them messing up. It is easy to say sitting in your armchair in Marbella that things should have been done differently.

There are dumb decisions and dumb decisions. Not knowing basic matters of business practice is beyond dumb.
Asking people how to avoid your legal and moral responsibilities on a public forum is also beyond dumb. This forum is not like expats.cz. People on here are respectable types, not fly-by-nights and big fish in little ponds with big ideas and scant knowledge.. They are business owners, former business owners and also employees. I'm sure they were impressed by your request for ways to 'weasel' (your words) out of your obligations as they too may be facing redundancy.
Some people may also think it dumb to advertise your woes publicly. Telling everyone that you need to make redundancies doesn't exactly help business confidence. Announcing that you wish to find ways of depriving your employees of their legal rights gives a poor image of any business. You say you want reliable and honest employees yet you tell us all you want to behave in a dishonest way to those you have had your use of. How can you expect loyalty from your employees when you behave like that?
As for your cleaners -surely you have them on temporada contracts where their entitlements are restricted?
You are a property management company that rents out apartments from owners for a fee. There may well be many people out there who would be put off usiing your services if they knew a) that you were in a position where you have to cut costs and b) that you were prepared to engage in such unethical practices.
So to answer your question: no, we didn't make 'dumb' decisions when running our businesses. We acted in accordance with the law and treated our employees fairly. We were proud of our reputation for integrity and fair dealing with all. I regard rogue employers and benefit cheats as one of a kind.
Internet trading is a fascinating phenomenum -few if any fixed assets, flexible and internationally mobile. Few lasting successes, many failures. But there is still an obligation to trade ethically. Some things such as reputation are of great value to most people.

[mrypg9]

Originally Posted by maxd

Agencies workers are unreilable. Once you have trained them they leave and you start again. Then you go in a circle. We needed reliablity. Now we get opportunism. Being rude, turning up late etc and something really really bad that I cannot go into here. You can sack them but that is what they want. Who can blame them, the system gives 45 days for every year work


Check this calculation out. Spain is 5 times the UK:

Based on minimum statutory paid notice and severance pay for a white-collar employee aged 40, made redundant after 10 years on a salary of £20,000, the average redundancy pay across the EU was £11,163.


But using the same comparison the redundancy pay would be just £5,000 in France and the Netherlands and £5,128 in the UK. In Spain and Italy the payment would be £25,464 and £18,276 respectively, and £15,000 for both Belgium and Austria



I know you do not care but imagine a company is burning cash in the recession now, and a lot are. To be strong and survive you need to cut down your labour force but the law says you have to pay mega bucks to get rid of them. The result is downsizing will kill you.

Luckily, we are not in that situation but A LOT of Spanish companies and all the talk of labour reform is just hot air but in the end Spain is going to a lot worse place for it.

You are digging a hole for yourself. Your employees are obviously aware of your attitude towards them and are reacting accordingly. If your employees steal or break the terms of their contract and labour law you can sack them on the spot for serious breaches - no comeback, no compensation. How can you say 'that is what they want'? They will get no redundancy and because they have been sacked they may not be eligible for some benefits. They will get no reference to help find another job. So how on earth can anyone 'want to be sacked'?????
And I'm not sure about your claim of 45 days for every year worked. But if that were so, then solid businesses make provision for that, as Xose has already told you. It's one of many factors that affect your pricing structure.
Not all companies shed staff in times of recession. If your staff are trained and qualified it is often counterproductive. Look at the example of Germany: (a very socialist country, by your definition, although Angela M. would be surprised to learn you view her as a red) the majority of German Mittelstand firms kept their workers during the tough times which could be why they are out of recession.
The bottom line is this: if your business is in such dire straits that you are unable to operate without cutting to the bone or resorting to dubious tactics then you have either made errors of judgment with your business model and strategy or you are just unlucky, another casualty of the downturn, a downturn many ascribe to economic policies of the kind you seem to advocate.