Since coronavirus confinement erupts the word ERTE has been one of the most pronounced and that has had the most presence in the news and within companies, and that is that the ERTE has been positioned as a solution to alleviate the complicated economic situation that a large number of companies are going through as a result of the coronavirus.
And more than 10 years ago, coinciding with another economic crisis, the word of fashion was the ERE,and it was another of the alternatives that companies took in to lay off their workers and thus lower the economic burden.
Two terms that although they are different have many things in common, which causes multiple doubts and confusions, so in AYCE Laborytax, as specialists in labor advice,we are going to tell you the differences between ERTE and ERE so that you know them in detail and know how to differentiate them perfectly.
Discover the main differences between ERTE and ERE
What is an ERTE?
The term ERTE means Temporary Employment Regulation Record,and emphasis must be placed on“temporary”to make it clear that aRTE is not a dismissal, this being one of the main differences between ERTE and ERE.
The ERTE is legislate in Article 47 of the Workers’ Statute, as a measure to which a company temporarily suspends the contract of one, several or all of its workers,with the aim of re-reinstateing them later, when the situation has stabilized and the causes that have caused the ERTE have disappeared.
For the duration of the ERTE, workers will not perform their work,nor will they collect the salary from the company or enjoy vacations or work losses. It should also be made clear that in an ERTE workers do not receive any compensation.
The ERTE also provides for the reduction of a mandatoryday, rather than a total suspension of activity. In this case, workers would keep the activity less than hours, charging the proportional share of the hours worked.
As regards duration, Article 47 of the Workers’ Statute does not provide for a specific duration for aRTE,neither minimum nor maximum.
During the ERTE the worker will not collect his salary from the company, but they will be entitled to the unemployment benefit,provided that they have quoted a minimum of 360 days during the last six years, just as it is a normal dismissal.
Typically, the deadline for applying for unemployment benefit is 15 days, but in coronavirus ERDs there is no time limit for applying for the benefit.
What is an ERE?
ERE stands for Employment Regulation File, withoutthe time term, and implies collective redundancy for workers in a company.
The EERE is regulated in Article 51 of the Workers’ Statute as a effective and firm redundancy formula,which applies when a company is forced to cease its business because of a poor economic situation, or when it needs to reduce the number of employees to offsl the economy.
A worker affected by an ERE shall be entitled to compensation and to collect unemployment benefit at 100%, making it clear that the duration of the ERE is indefinite.
The differences between ERTE and ERE
If we talk about the differences between ERTE and ERE, the main difference is that the ERE is a firm and effective collective redundancy, while the ERTE is a suspension of a temporary contract. An ERE-making company is firing its workers, while with the ERTE they simply suspend its activity for a defined time.
Another difference between ERTE and ERE is that with the ERE workers are entitled to compensation,where while with an ERE they do not, since it is not a dismissal.
It should also be noted that any company can make an ERTE whenever justified,regardless of the sector and the number of workers. If there are economic, technical, organizational or production causes, the ERTE will not need to be approved by the labour authority.
On the other hand, not all companies can make an ERE,as we must meet a number of conditions indispensable to apply for the ERE that we will tell you below:
- The ERE must affect at least 10 workers in companies of less than 100 workers.
- The ERE should affect 10% of employees in companies of between 100 and 300 workers.
- The ERE must affect 30% of employees in companies with more than 300 workers.
These are the main differences between ERTE and ERE that you should know so as not to confuse them. Both terms are solutions for companies experiencing times of economic difficulty, the main difference of which is that the ERTE is a temporary suspension of employment, while the ERE is a final and firm collective redundancy.