The 2021 Labour Reform explained in terms of novelties and differences with respect to that of 2012. Last December 30, Royal Decree-Law 32/2021, dated December 28, was published, which contained the 2021 Labour Reform. This reform is the result of an agreement reached with both Spanish trade unions and employers’ organizations.
As it is a Royal Decree-Law, it must be validated by the Congress of Deputies as required by Article 86 of the Spanish Constitution in its paragraph 2. If the text is not validated, it would be repealed in its entirety, although it would have been in force during the period subject to validation.
The 2021 Labour Reform
Its purpose is to introduce changes along three lines:
- Simplification in hiring matters.
- Internal flexibility measures for companies in difficulty.
- Modification of collective bargaining
The text came into force the day after its publication in the Official State Gazette, i.e. December 31, 2021. However, as regards hiring, the new regulation will enter into force on March 31.
We will summarize the new features and changes, as well as what remains unchanged.
In relation to temporary contracts, the number of contracts is limited to two, with the temporary contract for work or service disappearing. Therefore, the structural contract and the training contract will remain.
On the other hand, the chaining of contracts when considering a permanent worker is reduced from 24 to 18 months. As opposed to the 24 months in a period of 30 months that was currently in force.
Subcontracting is also reformed, so that between contractors and subcontractors, there will always be a sectoral collective bargaining agreement applicable. Consequently, the company agreement may only be applied by the contractor if it determines better wage conditions than the applicable sectorial agreement.
A new ERTE model is also established. It establishes as a structural and differentiated cause of the ERTE due to force majeure the limitations of the normal development of the activity by decision of the competent authority.
The new RED mechanism for Employment Flexibility and Stabilization is introduced.
With respect to agreements, the hierarchy of the company agreement is maintained in all sections. Except for the determination of the amount of the base salary and its supplements, which will take as a reference what is estimated in the sector’s agreement. In addition, it does not establish an “expiration” period once an agreement is terminated. Its validity will continue to be maintained for as long as the negotiations for a new one are extended.
What is maintained in the Labour Reform
Temporary employment agencies may continue to act as placement agencies, in collaboration with the public employment offices.
It maintains the compensation for unfair dismissal. Currently it is 33 days, with a maximum of 24 monthly payments.
The causes of the objective dismissal such as the persistent decrease of income during three consecutive quarters.
The need to obtain prior authorization to carry out an ERE is not recovered either.
It maintains the right to 20 hours of annual training for all workers.
In the following articles, our experts in HR management will detail the main novelties of this 2021 Labour Reform.