Blog Derecho Laboral

Labour indemnifications cost dismissals in Spain

There are different ways a labour contract may be extinguished under Spanish labour laws.

1.      Employee’s withdrawal

The employee may leave the company at any moment. The company has no obligation to give him any indemnification. Just the proportional earned vacations, salary and extra payments.

2.      Disciplinary reasons sack

A Judge will sentence this sack as fair, unfair or null.

Fair:

The company will not have to pay anything because disciplinary reasons will be proved.

Unfair:

The company will have to pay an indemnification of which amount will be calculated with two stretches:

  • Till 12/02/2012 the indemnification will be 45 days of salary day, per year of service at the company, with a maximum of 42 months of salary.
  • Since 12/02/2012 till the sacking day will be 33 days of salary day, per year of service at the company, with a maximum of 24 months of salary.

Null:

If the Judge has considered that the company has infringed a fundamental right.

The consequence will be a readmission with right to perceive salaries since the sacking day, and an additional indemnification if the employee has had claimed damages.

3.      Contract resolution because of objectives causes:

The company can try to resolve employee’s contract because objective causes.

Basically, objective causes are: economical, technical, organizational and productive causes.

In that way, the company must give a 20 days of salary day, per year of service at the company, with a maximum of 12 months of salary with the resolution letter.

The employee can claim against agued company reasons and a judge will consider if the resolution is fair or unfair:

Fair:

The 20 days indemnification will be well done.

Unfair:

The company will have to pay to the employee the gap till 45 days of salary day, per year of service at the company, with the maximum of 42 months of salary (or commented 33 days with a top of 24 months since 12/02/2012).

4.      Contractual modifications:

There are other ways the contract could be extinguished. One of them could be as a consequence of a substantial modification, or a moving.

Substantial contractual modifications:

If the company modifies journey; horary or timetable distribution; shifts; salary or remuneration system; category, the employee has the possibility to claim against it or perceive an indemnification of 20 days of salary day, per year of service at the company, with a maximum of 9 months of salary leaving the company.

The company has to argue these changes with the same commented objective reasons: economical, technical, organizational and productive causes.

Moving:

If workplace moves in a distance that the employee has to move his address, the employee has the possibility to claim against it or perceive an indemnification of 20 days of salary day, per year of service at the company, with a maximum of 12 months of salary leaving the company.

The company has to argue this moving with the same commented objective reasons: economical, technical, organizational and productive causes.

5.      The employee can claim contractual resolution if there are company non-fulfillment.

If the company does not fulfil his basic labour contractual obligations, the employee can claim in court his labour contract with right to 45 days of salary day, per year of service at the company, with the maximum of 42 months of salary indemnification (or commented 33 days with a top of 24 months since 12/02/2012).

ConesaLabour indemnifications cost dismissals in Spain