The first part of the pension reform designed by the Minister of Inclusion, Social Security and Migrations, Josá Luis Escrivá, has been approved as a bill by the Council of Ministers and is only pending the parliamentary ‘yes’ for its implementation March at the end of 2021. A bunch of changes within which early retirement is clearly affected.
After a few months of negotiations that culminated in the green light of the unions and the employers , Minister Escrivá is very close to ratifying some changes that aim to align the real age and the effective retirement age, promoting the prolongation of the working career from the workers.
To do this, a series of changes have been made in different forms of early retirement and that are added to other innovations such as the repeal of the sustainability factor , the revaluation of pensions with the CPI (Consumer Price Index), new incentives for delayed retirement and restrictions on forced retirement .
With regard to voluntary early retirement, the reducing coefficients that reduce the pension of the worker who retires before the ordinary age will be modified. These coefficients will become monthly (currently they are quarterly) and will be applied to the amount of the pension (now they are applied on the regulatory basis).
This is how the reducing coefficients will be
These reduction coefficients will be lower in most cases , making the delay in early retirement more attractive. Thus, early retirement in the middle sections of the coefficient table will benefit the most , especially those made 16, 13 and 19 months in advance.
On the other side of the scale, early retirements with a higher advance payment (24 and 23 months before, the maximum allowed), as well as those made with one, two and three months in advance will be the most affected by the reform, which seeks to discourage these early retirements seeking to extend the career to more benign sections or, directly, to the ordinary retirement age.
For early retirement of workers with salaries above the maximum amount of pensions, the current system of coefficients (which raises reductions of 0.50% per quarter of advance) will be changed to that of the rest of voluntary early retirements, although it will be in a gradual 10-year process that will begin in 2024.
Early retirement due to causes not attributable to the worker will also undergo changes: the new reducing coefficients will be applied to all those people who, at the time of early retirement, have received an unemployment benefit for at least three months.
In addition, for involuntary early retirement, these new coefficients will also be applied instead of the current ones, provided that this benefits the worker. In parallel, the coefficients of this modality become, as for the rest, monthly instead of quarterly.
Lastly, there will be modifications in early retirement due to activity , those that due to toxicity or danger may lead to early retirements even before the two years prior to ordinary age.
In this sense, the Ministry of Inclusion, Social Security and Migrations has already reported that the regulation for these early retirements will be “more effective” by changing the procedures and the greater detail of the indicators of dangerousness or hardship.