Thousands of companies in the Balearic Islands have begun applying for temporary layoffs for their employees, which in some cases will be the entire workforce.
Employers and unions estimate that thousands of companies will submit temporary employment regulation files, or ERTE, to deal with the crisis caused by coronavirus.
In February there were 441,667 members of Social Security and experts are predicting that ERTEs will affect about a third of those.
The Balearic Islands has reached a Social Agreement between the Government, Employers and Unions to expedite Administrative procedures quickly, so that unemployment benefits can be paid as soon as possible.
Force majeure ERTEs, which are applied due to the State of Emergency, will not be sent to the Labour Inspectorate to issue the corresponding report, they will be sent to the Government.
The Minister of Tourism & Employment, Iago Negueruela, signed the agreement on Wednesday with the CAEB President, Carmen Planas, PIMEM President, Jordi Mora; the UGT General Secretary, Alejandro Texías; and CCOO General Secretary, José Luis García.
The General Directorate of Labour, will be in charge of signing the ERTEs of force majeure, "which will be the majority of those that appear," admitted Negueruela.
"This measure means the workers will be able to get paid as soon as possible," said the Minister, who emphasised that his priority is to protect employees and prevent layoffs. He also said that companies that process an ERTE by force majeure can benefit from a bonus to Social Security contributions.
Temporary layoffs will affect companies in all sectors and sizes in the Balearic Islands. Activity in the Tourism Sector, which is one of the worst affected, has been completely paralysed and that will have a knock on effect on many other companies.
The Platja de Palma Hotel Association confirmed on Thursday that a high percentage of hotels in the area would be able to issue an ERTE as will hotels in the rest of the Island, according to the Hotel Federation.
Around 200 hotels were still open on Sunday but they are closing gradually and are all forecast to be empty by next Wednesday.
Globalia says it has already notified the unions that it will issue ERTE for its companies, because bookings for Air Europa and Falcon have fallen sharply.
The Directorate-General of Labour has already strengthened staff numbers from one to 26 people to help process the applications and also plans to extend the daily working hours. Anyone with any doubts or questions should call the Government helpline on 900 101 798.
The temporary layoffs will affect thousands of employees on the Islands, so both the Balearic Employment Service, SOIB, and the State Public Employment Service, SEPE, have strengthened their staff numbers to cope with the influx.
At the SOIB, the demand for employment will be renewed automatically until April 30 and registration can be done electronically, although the offices are open to the public.
SEPE, which handles claims for unemployment benefits, only operates by telephone and they are swamped.