Severance pay for temporary workers.

Severance pay for temporary workers.

Undoubtedly, temporary workers in Spain are one of the most unprotected sectors since the crisis began in 2008. Especially in regard to severance pay. Once again, the Government has taken action on the matter to appear an improvement in compensation for dismissal for temporary workers. This improvement, once again, is designed to help employers and not workers. In this article you can find out everything.

The great duality of work in Spain

The great duality of work in Spain

Spain is one of the developed countries where there is more duality regarding the type of workers. On the one hand there are undefined workers with a somewhat higher salary and greater protection against dismissal. And on the other are temporary workers. The most unprotected sector of the two. Not only do they have much lower salaries but also their protection against dismissal is virtually non-existent. Situation that has gotten even worse since the crisis began.

And although employment growth in Spain is already around 3%, one of the highest values ​​in all of Europe, the temporary employment rate is still overwhelming. Around 30% of the jobs created are temporary. Not forgetting another high percentage that is hired through the indefinite model created by the Government in the last labor reform and ending in dismissal. Despite these poor readings, the Government seems to want to collaborate for once to strengthen the rights of workers vis-à-vis those of employers. For this, it has already announced its two star measures: the reduction in the type of contracts that currently exist and the increase in the cost of dismissal for entrepreneurs.

Let’s look at both measures more calmly.

Contract type reduction

The Minister of Employment and Social Security advocates the reduction of the type of contracts that exist today. In total, the idea is that only three hiring models remain on the table, which will be the following:

  • Indefinite contracts
  • Temporary contract
  • Internship contracts. This last modality will include the current training modalities.

Without a doubt, reducing the number of contracts is one of the pending issues on the part of the Government. The ideal would be to create a single type of contract with compensation that would grow according to the years worked.

Increase of the cost of dismissal

Or what is the same, somewhat fairer compensation for those employees who lose their jobs. The idea is that the new model of temporary contract is associated with a growing compensation that would be distributed as follows:

  • A compensation of 12 days per year worked during the first 12 months of the contract.
  • A compensation of 16 days per year worked during the first 24 months of the contract.
  • A compensation of 20 days per year worked from 3 years of contract.

These measures are intended to equate the conditions of dismissal in temporary contracts with the conditions of dismissal in indefinite contracts

Will the Government’s proposal to improve compensation for dismissal of temporary contracts be of any use?

Will the Government

Probably not. The effects of the formula proposed by the Minister of Employment and Social Security will have virtually no impact. Do not forget that most of the contracts signed in Spain are temporary. And that of these contracts the vast majority does not exceed the year. Taking into account that it is proposed that during the first year of dismissal the compensation be 12 days per year worked, there will be no difference with the current situation for the vast majority of temporary workers. This is precisely the amount they quote today when they are fired.

Only 0.35% of the temporary contracts signed during 2016 could be compensated with this measure.

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