The Spanish so-called Employment Law reform addresses several aspects in labor and social security matters, including administrative fines. We will focus on the modifications introduced in “Workers’ Statute”, the Law regulating employment contracts and the relationship between the employer and the employee.

These changes have been endorsed by negotiation and social dialogue, with the support of trade unions, the employer’s organization, and the Spanish Government. For that reason, we think that this previous dialogue will provide greater stability to the new rules.

Important Changes

The new regulation aims to correct provisional, temporal contracts, by limiting its abusive, unjustified, and disproportionate use.

The law also returns to the collective negotiation system existing before the 2012’s reform. As a consequence, the company level and local collective agreements will need to be in aligned with sectorial or higher scope collective agreements.

The Employment Provisional Regulation Files (“Expediente de Regulación Temporal de Empleo” ERTE) that allow employers to provisionally “suspend” an employment agreement, due to financial “objective” reasons, has been a success during the COVID 19 pandemic effects. And the new regulations introduce these ERTEs as a normal alternative to the termination of labor relations in times of crisis that could affect the companies.

The new regulations also change the employees’ Social Security contributions and benefits and the processing of Employment Regulation Files, but we will focus on these changes in a future article. Here we will now concentrate our analysis in the changes introduced in the employment contracts.

Andrea Accuosto