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Labor reform (II): Fixed-term contracts

As we already mentioned in the previous post, we continue analyzing the labor reform published by the Royal Decree-Law 32/2021, of December 28, on urgent measures for labor reform, employment guarantee and the transformation of the labor market.

If training contracts came with important modifications, fixed-term contracts have not been left behind. We cannot forget that one of the objectives of this reform was “the reduction of temporary employment” and to prevent us from being one of the countries that makes the most use of this type of contracts.

For this reason, the following measures have been taken, among others:

  • Complete elimination of the contract for a specific work or service from the contract.
  • Penalty of temporary contracts of less than 30 days.
  • Reduction in the time limit of chains of temporary contracts.
  • Increase in administrative sanctions for fraud in said contracts.
  • Temporary plans through collective agreements.

Fixed-term contracts (art. 15 of the Workers' Statute)

Fixed-term contracts are included in article 15 of the ET in which we can differentiate two types:

  1. Temporary contracts due to production circumstances.
  2. contracts for replacement of the worker.

For it to be understood that a cause of temporality exists, it will be necessary for there to be (i) an enabling cause, (ii) circumstances that justify it and its connection with the planned duration.

Types of contracts

  1. Possible due to production circumstances.

Within the eventual contract due to production circumstances we can find two modalities:

  • 1st modality
    • Purpose: the occasional and unpredictable increase and fluctuations (among others, vacations) that, even in the case of the normal activity of the company, generate a temporary mismatch between the stable employment available and that which is required.
    • Duration: may not exceed 6 months, the collective agreement may extend to 1 year. By agreement between the parties, it may be extended once.
  • 2nd modality
    • Purpose: to attend to occasional, foreseeable situations that have a short and limited duration.
    • Duration: companies may use this contract for a maximum of 90 days a year. It is a global company term, regardless of the workers affected. It cannot be used continuously, in principle to make use of this contract, for example: 40+20+30, 88+2, 70+20, etc.
    • The rule indicates that this contract may not be used within the framework of contracts, subcontracts or administrative concessions that constitute the usual or ordinary activity of the company, unless the circumstances of the production previously provided for occur.
  1. Replacement of worker

Within the contract for substitution of the worker we can find three modalities:

  • Replacement of a worker with the right to reserve a job:
    • Specify in the contract the name of the replaced person.
    • Indicate the cause.
    • They will have the right to reserve their job, as established in article 46 of the Workers' Statute.
    • The provision of services may begin before the absence of the replaced person occurs (max. 15 days)
  • Substitution to complete the reduced working day by another worker:
    • Specify in the contract the name of the replaced person.
    • Indicate the cause.
    • Cause legally protected or regulated in a collective agreement.
  • For temporary coverage of a job position during the selection process:
    • For definitive coverage through a fixed contract.
    • Maximum duration 3 months.


The rule, in order to avoid a succession of temporary contracts, establishes that those workers who within a period of 24 months have been contracted for 18 months, with or without a solution of continuity, for the same or different position in the company will be considered permanent. same company -or group-, through two or more temporary contracts.

Those people who occupy a job that had previously met the requirements mentioned in the previous paragraph will also acquire permanent status.

Collective negotiation

Collective bargaining will play an important role in the entire labor reform, due to the amount of content that has been left pending agreement, specifically regarding fixed-term contracts:

  • Extending the duration of temporary contracts due to production circumstances - occasional and unpredictable - by 6 more months.  
  • Ensure the transmission of information regarding the existence of permanent vacancies.
  • They may establish plans to reduce temporary employment, as well as establish criteria for an adequate relationship between the volume of temporary hiring and the company's total workforce.
  • They may establish objective criteria for converting fixed-term contracts into indefinite ones.
  • They will set maximum temporary percentages and the consequences derived from non-compliance with them.
  • Establishing preference criteria among people with temporary contracts.

As we see, what both unions and employers have pending is not trivial and everything seems to indicate that it will be the source of various controversies that will end up being judicialized in the coming months.


Until when can I enter into contracts according to the previous rule?

Until March 30, 2022, fixed-term contracts may be entered into as provided in the previous rule, except for the duration, which will be 6 months.

From when does the new rule begin to apply?

As of March 31, 2022, the new labor regulations (RDL 32/2021) will apply.

We will soon publish “Labor Reform (III): Fixed-Discontinuous Contracts”.

Labor Manager || Professor - Work area in EIP - International Graduate School

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