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Contracts1

2.1 General aspects

This section deals with the main aspects to be considered when hiring workers in Spain.

In general, discrimination in hiring or in the workplace on the grounds of gender, marital status, age, race, social status, religion or political ideology, membership of a labor union or otherwise, or on the basis of the different official languages in Spain is prohibited.

The minimum employment age is 16 years old and there are certain special rules applicable to the employment of persons under the age of 18 (who, for example, cannot work overtime or at night).

2.2 Types of contract

Contracts can be made verbally or in writing, unless there are express provisions that require a written contract (for example, temporary contracts, part-time contracts and training contracts). If this formal requirement is not met, the contract is understood to be permanent and full-time, unless evidence is provided to the contrary.

Companies must provide the workers’ statutory representatives (if any) with a basic copy of all contracts to be made in writing (except for senior management contracts). The hiring of workers must be notified to the Public Employment Service within ten days of the contracts being made.

There are various different types of contract, including indefinite-term, temporary, fixed-term, training, distance work and part-time contracts.

In the website of the National Public Employment Service2 any can access a virtual assistant for employment contracts which, based on four basic types of employment contracts (indefinite-term, temporary, training and work-experience contracts), suggests and prepares the type of employment contract that best suits the characteristics of each new hire.

The principal features of these types of contracts are explained below.

2.2.1 Fixed-term contracts

Spanish legislation sets out specific grounds for the execution of fixed-term or temporary contracts.

All temporary contracts must be made in writing and must specify the reason for their temporary nature in sufficient detail. Otherwise, or if the ground for the temporary contract does not truly correspond to one of the legally-established grounds, the contract will be deemed to be made for an indefinite term, unless evidence of its temporary nature is provided.

If the fixed-term employment contract is made for a term of more than one year, the party intending to terminate the contract must serve notice at least fifteen days in advance or, as the case may be, give the advance notice established in the applicable collective labor agreement (Table 1).

Table 1

TYPE GROUND TERM OBSERVATIONS
Contract for project work or services Performance of a specific independent and self-contained project or service within the company’s business. In principle, uncertain. It will depend on the time taken to perform the project or service, with a maximum of 3 years, which may be extended for a further 12 months under a nationwide industry collective agreement or under an industry collective agreement of a more limited scope.

The temporary grounds for the contract must be stated clearly and precisely. For contracts entered with after 2014, its termination entitles the employee to receive a severance equal to 12 days’ salary per year worked (for contracts entered into in 2014, its termination entitles the employee to receive a severance equal to 11 days’ salary per year worked).

When the maximum periods established for any temporary contract have elapsed, workers will acquire the status of indefinite-term employees of the company. When workers have been hired for more than 24 months within a 30-month period, with or without interruption, for the same or different position at the same company or group of companies, under two or more temporary contracts, whether directly or through temporary employment agencies, using the same or different types of fixed-term contract, the contract will be automatically converted into an indefinite-term contract.

Casual contract to cover temporary demand for production To meet market demand or backlogs or work or orders. Maximum of 6 months within a 12-month period (may be extended under an industry-wide collective labor agreement to an 18-month period but may not exceed 3/4 of that period in length, or the maximum term of 12 months).
Contract of first youth employment To acquire the first professional experience.

Minimum length of 3 months and up to 6 months which can be extended by a sector-wide CBA up to 12 months.

These contracts are regulated by the provisions applicable to contracts to cover temporary demand for production.
The employees must be up to 30 years old, unemployed and must not have professional experience or it must be less than 3 months. The contract can be entered into full time or part-time as long as the work time is at least 75% of the work time of a comparable employee.
Relief contract To substitute workers entitled to return to their job due to a statutory provision, or the provisions of a collective labor agreement or individual agreement.

From the beginning of the period until the return of the substituted worker or expiry of the term established for the substitution.

One of the formal requirements is that the contract must state the name of the substituted worker and the grounds for the substitution.

2.2.2 Training contracts (Table 2).

Table 2

PART-TIME CONTRACTS

CONTRACT PURPOSE TERM OTHER INFORMATION OF INTEREST
Work experience contract

Hiring of university graduates or workers with higher or advanced vocational training qualifications (first degree, master’s degree or doctorate) or officially recognized equivalent qualifications, or workers holding a vocational qualification certificate (certificado de profesionalidad) entitling them to work in their profession.

Minimum of 6 months and maximum of 2 years.

Sick leave, leave due to risk during pregnancy, maternity leave, leave for adoption or custody for adoption or fostering, leave due to risk during breastfeeding and paternity leave all toll the duration of the contract.

As a general rule, no more than 5 years may have elapsed since completion of the relevant studies, or 7 years if the contract is made with a disabled worker.
The minimum salary is 60% (during first year) and 75% (during second year) of the fixed salary established in the collective labor agreement for a worker with a similar or identical position.
Trainee and apprenticeship
contract
Contract targeted at young people who lack the occupational qualifications recognized by the vocational training system or education system required for a work experience contract for the position or occupation for which the contract is made. Minimum of 1 year and maximum of 3 years. Term may be modified by a collective labor agreement but may not be less than 6 months or more than 3 years.
Sick leave, leave due to risk during pregnancy, maternity leave, leave for adoption or custody for adoption or fostering, leave due to risk during breastfeeding and paternity leave all toll the duration of the contract.
Although there are special cases, as a general rule, this contract is aimed at workers of between 16 and 25 years of age (while the Spanish unemployment rate remains above 15%, the upper age limit is extended to 30 years). This age limit is not applicable where the contract is with disabled workers or socially excluded personnel.
Compensated employment at a company must be alternated with training activities at a vocational training center or educational center.
Part-time contracts cannot be made. Workers cannot work overtime (except to prevent or repair extraordinary and urgent damage), at night or in shifts.

2.2.3 Part-time contracts

An employment contract will be part-time contract when a number of hours of work has been agreed with the worker per day, week, month or year which is less than the working hours of a “comparable full-time worker”, that is, a full-time worker at the same company and workplace who performs identical or similar work.

Part-time workers have the same rights as full-time workers, although at times, according to their nature, such rights will be recognized proportionally, according to the time worked.

Part-time workers cannot work overtime, except to prevent or repair losses and other urgent and extraordinary damages.

However, supplementary hours (hours worked in addition to those agreed in the contract, the performance of which is agreed beforehand) can be carried out. Supplementary hours may not exceed 30% of ordinary working hours (except where they are increased up to 60% in a collective labor agreement).

However, the employer is allowed to offer the employee hired indefinitely on a part-time basis no less than 10 weekly hours (on an annual basis), supplementary hours which are voluntary, which may not exceed 15% of the ordinary hours of the employment contract (30% if agreed in the applicable collective labor agreement).

The total ordinary hours and supplementary hours may not exceed the statutory limit for part-time work.

2.2.4 Distance work (telework)

A distance work or telework arrangement may be reached provided it is formalized in writing (whether in the initial contract or a subsequent agreement).

Where work is predominantly carried out at the worker’s home or a place chosen by the worker, it is considered as distance work.

2.2.5 Indefinite-term employment contract
in support of entrepreneurs

This is a new type of full-time or part-time, indefinite-term employment contract available to companies with less than 50 workers. It may be used provided that the Spanish unemployment rate is below 15%.

The contract carries a trial period of one year and may not be used by companies that have dismissed workers on objective grounds held to be unjustified or implemented collective layoffs in the preceding six months. This contract is also eligible for tax incentives and reductions in social security contributions for certain groups of workers, provided that the company employs the worker for at least 3 years and that the level of employment reached at the company using this contract is maintained for at least one year from the date of the contract.

For further information on the requirements to be met to qualify for reductions, see section 2 on State Incentives for Training and Employment in Chapter 4.

2.3 Trial period

Employers can assess a worker’s abilities by agreeing on a trial period during which the employer or the worker can freely terminate the contract without having to allege or prove any cause, without prior notice and with no right to any indemnity in favor of the worker or the employer.

Where a trial period is agreed (provided that the worker has not performed the same functions before at the company under any type of employment contract, in which case the trial period would be null and void), it must be put in writing. Collective labor agreements may establish time limits for trial periods which, as a general rule and in the absence of any provision in the collective labor agreement, cannot exceed:

  • Six months for college and junior college graduate specialists.
  • Two months for all other employees. At companies with fewer than twenty-five employees, the trial period for employees who are not college or junior college graduate specialists cannot exceed three months.
  • One month in the case of temporary fixed-term employment contracts agreed for a time-period of less than six months.

Training contracts, indefinite-term employment contract in support of entrepreneurs and special employment contracts (domestic workers, senior managers, among others) have their own specific trial periods.

2.4 Working hours

The following Table 3 summarizes the fundamental legislation governing working hours.

Table 3

ITEM REGULATION 
Maximum working hours

The maximum working hours are those agreed in collective bargaining agreements or individual employment contracts (within the limits of the applicable collective bargaining agreements).

In general, the maximum working week is 40 hours of time actually worked, calculated on an annualized average basis, and the irregular distribution of working hours throughout the year may be agreed. In the absence of any agreement, the company may distribute 10% of the working hours on an uneven basis.

Overtime

Overtime is time worked in excess of the maximum ordinary working hours.
Paid overtime may not exceed 80 hours per year. The compensation with time off must be given within four months of the date on which the overtime was worked.
Overtime is generally voluntary.

Rest periods / public holidays / vacation / paid leave

A minimum of one and a half days off per week is mandatory, which may be accumulated by periods of up to 14 days.
Official public holidays may not exceed 14 days per year.
Workers are entitled to a minimum vacation period of 30 calendar days, and cannot be paid in lieu of that period.
Workers are entitled to paid leave in certain circumstances, such as marriage, performance of union duties, performance of unavoidable public or personal duties, breastfeeding, birth of children, relocation of main residence, serious illness or accident, hospitalization or death of relatives up to the second degree of kinship, etc.

Reduction in working hours

Workers may be entitled to a reduction in their working hours in certain cases, for example: to directly care for children under 12 or family members by consanguinity or affinity up to the second degree, who cannot take care of themselves, and during the hospitalization and continuing treatment of a child in their care with cancer or any other serious illness that entails a long hospital stay and who requires direct, continuing and full-time care, until the child reaches 18 years.

2.5 Wages and salaries

The official minimum wage is established by the Government each year and amounts to €735.90 per month or €10,302.60 per year for persons over 18 years of age (including 12 monthly and 2 extra payroll payments) for 2018.

However, the minimum wages for each professional group are usually regulated in collective labor agreements.

Salaries cannot be paid at intervals of more than one month.

At least two extra payroll payments must be paid each year: one at Christmas and the other on the date stipulated in the relevant collective labor agreement (generally before the summer vacation period). Thus, an employee’s gross annual salary is usually spread over 14 payroll payments; however, the prorating of the extra payroll payments within the 12 ordinary monthly installments can be agreed on in a collective labor agreement.


1     www.sepe.es

http://www.empleo.gob.es/index.htm

2    http://www.sepe.es/contratos/