Once again the social partners have decided to agree to price indexed wage increases. In Spain, there is a tradition of negotiating salary increase percentages, or most price-indexed salary review clauses, but the salary structure is never discussed. In other words, there is a lot of bargaining about how much is paid, how much is paid…
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Once again the social partners have decided to agree to price indexed wage increases. In Spain, there is a tradition of negotiating salary increase percentages, or most price-indexed salary review clauses, but the salary structure is never discussed. In other words, there is a lot of negotiation about how much is paid and what is less.
The country would be much better off if there were issues like workers’ participation in the company’s profits – salaries depending on how well the company / sector performs – or linking salaries to productivity.
The introduction of these wage-fixing systems is of particular interest to employers because it implies that the company will only increase wages if it is in a position to do so (because profits or productivity have improved). In addition, many academic studies around the world indicate that this type of link between salary and business results increases the productivity of organizations by engaging the worker and motivating their effort. In other words, the worker knows that if the company does well, they will get a share of the success: this improves commitment and effort.
However, this business willingness to participate in workers’ benefits/productivity, accepted in other European countries and especially the United States, is not shared in Spain. Precisely, in this near-term negotiation, the CCOO proposed to agree on salary increases linked to business limits.
The reasons are not easy to explain. A European Commission report examining the surprising lack of use of pay systems linked to business results in Spain concluded that the main business reason for rejecting their use was that companies did not want workers to “control” their annual accounts. That is, according to this study, employers understand that if wages are dependent on company profits, unions will have more reason to demand greater transparency about company-reported profits, and may even question their veracity.
If this study by the European Commission is correct, it seems to be a sufficient argument. Transparency in profit margins should be a prerequisite in a democratic country and not a reason to oppose wage systems that, according to academic studies, improve the productivity and competitiveness of our companies and generally improve the economy.
Finally, to end on a note of hope, perhaps if the Profit Margin Monitor announced by the Vice President of the Calvino Government gains momentum and the current secrecy regarding corporate profits is reduced, in a few years we can start to introduce salary systems that are really linked to business. Advantages/productivity to bring us closer to other countries around us.
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