Law 3/2012, enacted on 8 July 2012, amended article 86.3 of the Spanish Workers’ Statute. According to that amendment, if one year elapses from the moment a collective bargaining agreement has been challenged, without a new collective bargaining agreement having been agreed or an arbitral award having been made in this regard, the challenged collective bargaining agreement will no longer be effective and any higher ranking collective bargaining agreement will apply.

An agreement has been reached between the two most representative Spanish trade unions, CCOO and UGT, and the employer’s organisations, CEOE and CEPYME, in respect of thousands of collective bargaining agreements already challenged and due to expire on 8 July 2013 (the date on which the year-long extension pursuant to labour reform would elapse – “ultractividad”).

The agreement provides that the parties can agree, prior to 8 July 2013, to an extension of the negotiation period until a new collective bargaining agreement has been negotiated or, alternatively, to a maximum extension period, which could be months or years.

If an agreement is not reached before the new deadline elapses, or if the negotiation process is in deadlock, the parties must submit to mediation or arbitration.