More changes to labour law

A new government was appointed in October 2016, meaning labour law reform and legislative change can be expected. Whether such changes will follow the trend of the 2012 reform or will impose further restrictions on flexibility, remains to be seen.


CJEU decision affecting termination of fixed-term employment contracts

On September 2016, the Court of Justice of the European Union (“CJEU”) held that the current Spanish regulation on fixed-term contracts is contrary to the Framework Agreement on fixed-term work as it breaches the principle of non-discrimination. Namely, it does not establish any compensation for the termination of cover contracts, while granting compensation to “comparable permanent workers,” but with no objective reason for this different treatment.

Since this ruling, some courts have applied the compensation typically awarded for termination of a permanent contract (i.e. 20 days’ salary per year of work, capped at 12 monthly salaries) to fixed term contract terminations for this reason.

CJEU considers specific issues on collective dismissal regulation against the EU directive

The CJEU has considered Spanish legislation relating to collective dismissals in the context of the applicable EU directive in relation to the number of employees that need to be affected in order for them to use the collective redundancy procedure.

Several court decisions after the ruling have applied this interpretation.

With thanks to Jorge Aranaz of Cuatrecasas, Gonçalves Pereira for his invaluable collaboration on this update.