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Out-of-work freelancers face benefits blacklist

Only three in ten self-employed Spanish workers manage to successfully claim unemployment benefits when their businesses fold.

Published: 25 June 2013 14:06 CEST
Out-of-work freelancers face benefits blacklist
Tomás Burgos, Secretary of State for Social Security, has promised to deal with the problems of self-employed people trying to claim benefits. Photo: ppcv/Flickr

Of the 3,134 applications for unemployment benefits made by formerly self-employed people in the first quarter of 2013, only 853 were accepted, Spanish financial daily La Expansion reported on Tuesday.

Under Spanish law, self-employed people, or so-called autónomos, pay a flat rate of some €250 a month. They can then elect to make extra voluntary payments that entitle them to unemployed benefits if they lose their job.

These payments can be claimed after a year of self-employment, and the coverage can last up to 12 months.

But insurance agencies who work with Spain's Social Security agency turned down 1,381 applications from autónomos from January though March.

Another 830 applications, meanwhile, are still under review.

The majority of refusals arose because of people's "failure to correctly justify" either their loss of income, or to explain why they were giving up their line of work.

Once common situation involves self-employed people giving up work because of rises in rental costs at their place at work which make that employment no longer viable.

Non-renewal of rental contracts, meanwhile, is another reason why autónomos try to join the benefit queues.

Neither of the above situations, however, are considered justifiable causes when it comes to signing on for unemployment benefits.

Freelance workers in the "modular" tax scheme who do not have full accounts of their income and work activities can easily fall foul of technicalities.

Since January, freelancers whose income is in excess of €50,000 per year, or whose customer base is mostly private individuals, have been excluded from the modular tax scheme.

Tomás Burgos, the Secretary of State for Social Security, has promised to address the problems generated by the current system of unemployment cover for freelancers.

He told organizations in the sector that he would "more clearly define the documentation that freelance workers need to prove that they have stopped working."

Some 500,000 self-employed workers in Spain currently make payments that they hope will ens.

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WORKING IN SPAIN

Can I claim unemployment benefits and be self-employed in Spain?

If you're unemployed and are receiving benefits are you allowed to sign up to be self-employed at the same time? Will you lose your benefits or are there circumstances where 'autónomo' work and 'paro' are compatible?

Published: 7 August 2023 11:17 CEST
Can I claim unemployment benefits and be self-employed in Spain?

In a word, yes: you can claim unemployment benefits and be self-employed as well in Spain. But there are some caveats.

Since 2015, people have been allowed by Spanish law to register as self-employed and receive unemployment benefits at the same time, whereas in the past you would stop receiving unemployment benefits automatically the moment you registered as self-employed. Royal Decree 4/2013 and Law 31/2015 changed all that.

In Spain cobrar el paro (to receive unemployment benefits) is a right of all workers who’ve made at least 360 days of social security contributions in the last six years, and in some cases you can even qualify if you’ve only worked for three or six months.

READ ALSO: How much severance pay will I receive if I get fired in Spain?

The maximum period for which you can claim unemployment benefits while you are registered as a self-employed person is 270 days.

That is, you will be able to receive unemployment for the first nine months from the date you become self-employed.

There are also some rules, of course. In order to to be able to get unemployment benefits as a self-employed person in Spain you:

  • Cannot do any type of work as an ’employee’. In this case, your unemployment benefits are withdrawn. 
  • Do not need to comply with the usual obligations as a ‘job seeker’ as a self-employed person.
  • Must not have been self-employed and claiming unemployment at the same in the previous 2 years.
  • Can’t become a partner in a commercial company.

How much is it?

According to the Spanish government, “unemployment benefits are calculated according to the regulatory basis; this is the average of the contribution bases of the last 180 days of work prior to unemployment. The amount of unemployment benefit during the first 180 days will be 70 percent of the regulatory base, and from day 181 it will be 60 percent of that base”. 

READ ALSO: Spain approves new €600 per month unemployment benefit for artists

The exact amount you’re entitled to, based on that calculation, may not be lower than the minimum limit or higher than the maximum limit established by Spain’s IPREM – the index reference used to calculate state aid such as the minimum wage and unemployment benefits.

For 2023, the Spanish government set the monthly IPREM at €600.

Based on that, the minimum amount of unemployment benefit for 2023 will be €560 (without children) and €749 for this with dependent children. The maximum is €1,225 for people without children and €1,400 for people with one child, and €1,575 for people with more than one dependent child.

You can find more information about the minimum and maximum benefits here.

Self-employed in Spain

Spain reportedly ended 2022 with 3,329,863 self-employed people, with most autónomos working in commerce, agriculture, construction, hospitality, science and tech industries.

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