A downward spiral in household costs is dropping domestic workers to the lowest level since 2012

Hiring a housekeeper has become a luxury for many families. The successive increases in the minimum wage (SMI), and since last day1 the increase in contributions, are choking the pockets, already squeezed by the price vortex. The cost of hiring a full-time domestic worker today is €1,500, taking into account the salary and contributions to social security. At the end of 2022, there were 375,901 people contributing to the domestic helper scheme, the lowest number in ten years. During this period, the repercussions of this group did not stop. Various sources indicate the possibility that some of the workers, who are 95% of the cases women, have moved into the underground economy. A theory that can be partially explained if EPA data is analyzed. According to statistics, in the domestic service sector, there were more than 377,500 people at the end of 2022, 1,600 less than those reflected in Social Security. Among the other options considered by the experts consulted by this paper is that there has been a transition for workers from the family system to that of non-professional carers of dependents, since the state returned to contributing for them. Since 2019, the State General Administration bears social security contributions from these agreements and generates no cost to the non-professional caregiver. Mobile Desktop Icon Image Amplifier and App Mobile Code AMP Code 1240 APP Code The main advantage for non-professional caregivers, most of whom are also women, is that in this way the years spent caring for a dependent are integrated into their working life and they contribute to generating the right to Benefits such as retirement or permanent disability. Cutting hours, adjusting the contract, and reducing employee hours to avoid a raise, pay the same amount, and, at worst, a dismissal, are the paths taken by many employers in the face of a raise that some families cannot afford or are unable to. Moreover, willing to suddenly pay sometime, when a new increase in the minimum wage looms. This indicator has increased by almost 40% since the rule of Pedro Sanchez. It must be taken into account that the amount to be paid to social security must be added to the monthly salary once the contract is registered by the working family. The joint contingency contribution rate on a contribution basis that will be applied in each case will be 28.30%. This amount, in turn, is divided into a proportion of 23.60% paid by the employer and 4.70% paid by the housekeeper herself, deducted from the payroll. The total cost of contributions for domestic workers ranges from €308.99 to a minimum of €51.56. In the event of adding contributions, his monthly salary will be 1,500 euros. Since last October, domestic workers have been subject to a new regulatory framework that includes among the main novelties the obligation to contribute to unemployment and Fogasa, for both the employer and the worker. The government was forced to recognize their right to unemployment when they lost their jobs after the European Justice Organization (CJEU) considered the Spanish regulations to be discriminatory, inconsistent with European law and leading to a situation of “social helplessness” for this group. The European ruling came in 2019 after a domestic worker asked for unemployment contributions. Social Security refused her application on the grounds that it was not provided for in the legislation and that was when this worker decided to start a legal battle, which ended with a positive ruling by European justice. In this case, the Public Employment Service subsidizes 80% of these contributions to mitigate their impact on the family economy, according to a regulation approved in October, which also maintained a 20% reduction in the company’s contribution to the contribution for common contingencies. Bonus brackets above 20% have also been increased, depending on family composition and income and wealth levels. Related News Social Security Standard If Escrivá charges 20% unemployment contribution to Gonzalo D. Velarde families, the state will pay the remaining 80% of the new monthly fee that gives the group the right to unemployment. On the 1st of this month with the new additional contribution share of 0.6% which includes the intergenerational equity mechanism committed to Brussels, an increase in contributions with which the government intends to fill the pension bank, which now holds just over 2000 million euros. Of the total percentage the employer pays 0.5% and the worker the remaining 0.1%. New increase in SMI In addition, this year will bring more surprises for those who have employed or want to hire a domestic worker. The second vice president is preparing a new increase in the minimum wage to around 1,100 euros after listening to her experts. They have proposed to Yolanda Díaz an increase this year between 4.6% and 8.2%, which would put this bonus at a maximum of 1,082 euros per month in 14 payments compared to the current 1,000 euros. Diaz’s decision The final decision rests with Diaz, but he must first convince or reach an understanding with the Senior Vice President, Nadia Calvino, who is in favor of a fairly moderate increase. The Minister of Labor will also try to come to terms with social agents, even though the law says she is only obligated to consult them. With unions it would be much easier given that their requests are in line with those advocated by the employer, but with CEOE the bridges are broken, after employers accused the executive of changing the labor law from the back door so that the labor inspectorate has more power in controlling the causes of dismissal collective.