Castellán

As in each Round's beginning, the Executive Branch presented its guidelines a few days ago. On June 18th, the Tripartite Superior Council met and the final guidelines were introduced, proposing a kind of "bridge Round" for a year, which after being evaluated by the business chambers and the PIT-CNT was finally accepted on July 7th, 2020.

This agreement has found its foundation in the current crisis context caused by the presence of Covid19 in our country (a GDP drop of around 3% is estimated and the unemployment rate is at 10.5%). Due to the uncertainty of this situation, it was sought to simplify negotiation and address employment.

Following the Executive Branch's proposal, after its approval in the Tripartite Superior Council, it has been confirmed that these guidelines will be applied, through their subsequent ratification in the Groups and Subgroups (with the exception of the construction industry, health, and passenger transport - which are excluded).

The proposal finally accepted includes the following points:

Term 

This bridge Round will be in effect for one year, once the current Agreements expire, for those whose expiration occurs between June 30th and December 31st, 2020. This means that for most activity sectors, it will be in effect from July 1st, 2020, and will expire on June 30th, 2021.

Salary Increases 

Fixed nominal increase of 3% from the first day of the seventh month after the expiration within the aforementioned period (June 30th to December 31st, 2020), except for the most affected sectors that will apply the nominal increase from the first day of the tenth month. Sectors most affected are those that, by November 2020, have a number of contributors equal to or less than 90% of the contributors in November 2019, meaning they have had a decrease in employment equal to or greater than 10%.

Examples:

- if the agreement expired on 06/30/2020, the increase will be effective from 01/01/2021, unless it is an affected sector, which will apply it from 04/01/2021.
- if the agreement expired on 09/30/2020, the increase will be effective from 04/01/2021, unless it is an affected sector, which will apply it from 07/01/2021.
- if the agreement expired on 12/31/2020, the increase will be effective from 07/01/2021, unless it is an affected sector, which will apply it from 10/01/2021.

An additional 1% adjustment has been provided for those submerged salaries, which are less than or equal to $U 22,595 (5 BPC as of 01/01/2020). This additional increase will be granted at the appropriate time according to the activity, and will not be deducted from the final correction.

Final Correction

It should be noted first that a corrective for inflation must now be applied, as provided in the current Agreements. It is estimated to range between 1 and 5% depending on the sector of activity. For sectors classified as "medium" (approximately 70% of the total), this correction is at 3.42%.

Likewise, in the same way, a final corrective equivalent to the inflation of the moving year has been provided in this bridge Round, which in each case corresponds, deducting the salary increase granted in the period and also deducting the GDP drop in 2020.

The loss of purchasing power of the salary verified at the end of this eighth Round will be taken into account in subsequent negotiations to the extent that conditions allow (if the evolution of the GDP in 2021 indicates growth), starting in such case to recover the lost real salary from January 2022 onwards.

Extension of Benefits

The existing benefits in the previous Agreements of each sector are extended (with the exception of those granted only once), as well as the obligatory clauses.

Other Issues

It was also agreed to immediately start a tripartite social dialogue to address employment, business sustainability, and decent work. Likewise, it has been foreseen that the Government will continue to promote other measures to support companies in order to mitigate the effects of the pandemic, such as extending the partial/special subsidy until September 30th and in order to stimulate the preservation of jobs, companies will be granted a credit (to be deducted from employer contributions) of $5,000 for three months for each worker they rehire from total unemployment insurance, as well as in the case of those companies that do not have workers on unemployment insurance, for each new worker they hire, based on the list of workers they had as of May 31st, 2020. Regulations on this matter are expected in the coming days.

Montevideo, July 9th, 2020