Understanding Spanish Labor Laws: A Comprehensive Guide
1. Social Guarantee Fund (Fondo de Garantía Salarial – FOGASA)
The Social Guarantee Fund (FOGASA) is a public entity under the Ministry of Labor and Social Affairs, funded by businesses. It acts as insurance for workers in case their employer becomes insolvent or bankrupt. FOGASA covers unpaid wages and other benefits for a limited period, typically up to 120 days. The maximum compensation is capped at 30 days per year of service, and the salary received cannot exceed three times the interprofessional minimum wage. The employer’s contribution per worker is 0.20% of the wage.
2. Final Settlement (Liquidación)
Upon dismissal, contract termination, retirement, or settlement, a final settlement is issued to the employee. This document outlines all outstanding debts owed to the worker, including unpaid wages. The deadline for claims related to the final settlement is one year.
3. Payroll (Nómina)
The payroll is an official document detailing an employee’s salary and deductions. It’s divided into three sections:
- Accruals: This section lists the employee’s gross earnings.
- Deductions: This section shows the amounts withheld by the company for social security contributions and personal income tax (IRPF). These deductions are calculated based on the contribution base.
- Contribution Base: This is the amount used to calculate social security and income tax deductions.
Social security deductions are complex, with varying percentages for the employer and employee. The employer typically contributes 23.60% for common contingencies and 4.70% for professional training, while the employee contributes 0.60% and 0.10%, respectively. Personal income tax deductions depend on factors like income, family size, and qualifications.
3.1 Professional Categories
Professional categories are used to classify workers based on their skills and responsibilities. These categories influence working conditions, job type, and required qualifications. Some examples include:
- Engineers and Licensed Staff
- Technical Engineers and Administrative Chiefs
- Skilled Workers
- Unskilled Workers (18+ years old)
- Unskilled Workers (Under 18 years old)
For social security contributions, the first seven categories fall under one group with a monthly contribution, while the remaining four categories fall under another group. The contribution base is determined by the daily minimum and maximum wage set annually by the state budget.
4. Working Time
4.1 Working Day
The standard working day is defined by the labor statute, with a maximum of 40 hours per week. This can be reduced through collective agreements or individual contracts. Irregular distribution of working hours is possible, but requires agreement between the employer and employees. Key regulations include:
- Minimum rest period between working days: 12 hours
- Minimum rest period between weeks: 1.5 days, with at least 3 days off every 2 weeks
- Accumulation of days off: Allowed, but not exceeding 2 weeks
- Exceptions: Certain sectors like security, maritime work, hospitality, mining, construction, transport, and healthcare may have different regulations, such as a minimum rest period of 10 hours between working days.
4.2 Overtime
Overtime refers to hours worked beyond the regular working day. Compensation can be monetary or time off. Legal regulations limit overtime to a maximum of 80 hours per year. Overtime is generally voluntary, with some exceptions.
4.3 Holidays (Vacaciones)
Employees are entitled to paid annual holidays, with a minimum duration of 30 working days. The specific dates are determined by agreement between the employer and employee, often guided by collective agreements. Common practices include the employer setting a holiday period (typically announced in late April or early June) or allowing the employee to choose 15 days while the employer designates the remaining 15.
4.4 Permits
Permits are different from holidays. While holidays are a right, permits are absences from work for reasons unrelated to the company. Examples include:
- Marriage: 15 days
- Childbirth: 2 days
- Death, accident, or hospitalization of a close relative: Variable
- Change of address: Variable
- Attendance at public or personal events: Variable
4.4.1 Reduction of Working Hours Related to Family Responsibilities
- Premature birth: Parents can reduce their working hours by up to 2 hours each (only one parent can exercise this right).
- Care for a disabled child or a child under 6 years old: Working hours can be reduced by at least one-third and up to one-half.
- Victims of domestic violence: Eligible for reduced working hours.
4.4.2 Permits for Training and Professional Development
Employees are entitled to permits for training activities and exams related to their professional development.
4.4.3 Public Holidays
Spain has 14 public holidays per year. Two are chosen by the municipality, and the remaining 12 are national holidays (e.g., Christmas, New Year’s Day, May 1st, October 12th). The remaining holidays are determined by each autonomous community.
5. Trial Period
The trial period allows the employer to assess the suitability of a new employee. During this period, the worker has the same rights and duties as other employees, except for those related to contract termination. The trial period cannot be applied to workers who have previously held the same position within the company. Dismissal during the trial period can be appealed only if discrimination can be proven.
6. Professional Classification
Article 22 of the Workers’ Statute establishes a method for classifying workers into categories or occupational groups based on their skills, qualifications, and responsibilities. This classification is crucial for defining tasks, working conditions, and required qualifications for each group.