Read the alert in Spanish here.

Key Points

Are the types of employment contracts simplified?
Yes, training contracts are unified in one sole training contract with two types of such contracts (work-study training programmes and internships) and fixed-term contracts are also reduced to one single type, which can be entered into for production reasons or in order to substitute a worker.

Are temporary contracts for a specific project or service eliminated?
Yes, this type of contract has been eliminated.

Can workers be recruited by means of temporary contracts for production reasons to perform work within the context of subcontracting, outsourcing or administrative concessions?
As a general rule, temporary recruitment is not possible when the subcontracting, outsourcing or administrative concessions involve the company’s usual or ordinary activity. The reform includes current case law doctrine on this point; therefore, this provision will not have a significant impact. 

Can workers be recruited by means of a discontinuous-permanent contract to perform work within the scope of subcontracting, outsourcing or administrative concessions?
Yes, employment by this permanent contractual system is promoted for performing work consisting of rendering services within the scope of subcontracting, outsourcing or administrative concessions.

Is the limitation in successive temporary contracts reinforced?
Yes, the temporary period that determines the temporarily recruited worker’s right to acquire the position of a permanent worker is reduced more than eighteen months in a period of twenty-four months) and there is a guarantee applicable to the job temporarily held; therefore employees holding their jobs for more than eighteen months within a period of 24 months by means of two or more contracts for production reasons will also become permanent employees.
 
Are administrative sanctions for fraudulent use of temporary contracts reinforced?
Yes, an administrative infringement will now be considered for each worker involved. Moreover, the amounts of the fines are also higher: at the minimum level from €1,000 to €2,000; at the medium level from €2,001 to €5,000 and at its maximum level from €5,001 to €10,000.
 
What changes have taken place within the scope of contracts and sub-contracts for projects and services?
The most significant aspect is that, as a general rule, the collective bargaining agreement applicable to the contractor or sub-contractor company will be the one of the business sector included in the contract or sub-contract, regardless of the company’s object. However, if the contractor or sub-contractor company has its own collective bargaining agreement the latter will be applicable.
The reform includes current case law doctrine on this point; therefore, this new provision will not have a significant impact. 

Has the one-year period of ultra-activity in collective bargaining agreements been eliminated?
 Yes, ultra-activity in collective bargaining agreements now has no time limit.
 
Does the application of companies’ collective bargaining agreements continue to take prevalence in certain matters over higher-level collective bargaining agreements?
Yes, but it is significantly limited because the application of the company’s collective bargaining agreement eliminates the prevalence over the amount of the base salary and salary supplements, including those subject to the company’s situation and profits or losses.
 
Has the current temporary lay-off system (ERTE) been reviewed?
Yes, following the model used during the pandemic, temporary lay-offs are allowed to be processed for Economic, Technical or Production reasons (ETOP) and the hindrances or limitations in the company’s normal activities are expressly included as a specific situation of force majeure if they are due to decisions adopted by the competent public authorities, including those aimed at protecting public health.
 
Is a new mechanism provided for internal flexibility in situations of crisis stemming from the macroeconomic situation or reconversion processes and professional transition in a certain business sector or sectors?
Yes, following the model used during the pandemic, the resource of using measures to reduce and suspend contracts is encouraged as an alternative to dismissals in certain contexts where there are macroeconomic difficulties or production reconversion and transition by creating the RED Mechanism for Job Flexibility and Stabilisation.
    

In the following link you will find the summary of the Royal Decree-Law 32/2021.