On 18 June 2010 Royal Decree Law 10/2010 (the Royal Decree Law) dated 16 June 2010 came into force, approving labour law reform in Spain. (Please see our July 2010 newsletter regarding the Royal Decree Law.) The Royal Decree Law has been processed as Law 35/2010 (the Law), dated 17 September, on urgent measures for labour market reform. The Law introduces some changes to the Royal Decree Law.

The main changes included are the following:

  • for termination of employment for technical or organisational reasons, the Law introduces a more complete definition of the economic causes than was established in the Royal Decree Law. There is now a definition of ‘negative economic situation’, meaning current or expected losses or a decrease in the employer’s income that could affect its capacity to maintain employment levels;
  • in the event of a collective redundancy, an organisation can substitute mandatory consultations with the employees’ representatives with arbitration proceedings, to speed up the process;
  • a reduction in the number of days that unemployed people are allowed to reject training courses without incurring any penalities from 100 to 30 days; and
  • payment in kind cannot exceed 30 per cent of the employee’s salary.