Comprehensive Guide to Fixed-Term Contracts (CTOs) in Spain

Posted on Nov 7, 2024 in Law & Jurisprudence

What is a Fixed-Term Contract (CTO)?

A Fixed-Term Contract (CTO) in Spain is a type of employment contract with a predetermined end date. It’s used for temporary work situations and is subject to specific regulations under Spanish labor law.

Essential Elements of a CTO

  • Consent: Both the employer and employee must agree to the terms of the contract.
  • Purpose: There must be a legitimate reason for using a fixed-term contract, such as a temporary project or the need to cover a specific absence.
  • Specific Permissible Cause: The law outlines specific situations where a CTO is allowed.

Elements Related to Personal Information

  • Employee: Age, nationality, etc.
  • Employer: Age, capacity, etc.

Other Important Items

  • CTO Form: The contract must be in writing.
  • Information Content of the CTO:
    • Identification of the parties
    • Start and end dates
    • Company and worksite
    • Job category
    • Duration
    • Collective bargaining agreement
    • Compensation
    • Working hours
    • Holidays
    • Notice period
  • Nullity of the CTO: A CTO can be declared null and void if it’s deemed unfair or illegal.

Trial Period

  • Graduated based on the duration of the contract and the employee’s age.
  • For example, a contract lasting less than 6 months has no trial period for workers under 25 years old, but a 3-month trial period for those 25 and older.

Types of Fixed-Term Contracts

Fixed-Term Contract with a Determined Duration (Temporary)

  • Training: For practical training and skill development.
  • Causal: For specific work or services with a defined duration.
    • Potential for temporary circumstances, such as covering for an employee on leave.
    • May be used for part-time work or partial retirement.
  • As a Bridge to Employment: For individuals with disabilities or those approaching retirement age.

Fixed-Term Contract with an Indefinite Duration (Fixed)

  • Encourages the conversion of fixed-term contracts into permanent contracts.
  • May include bonuses for converting to permanent employment.
  • Specific provisions for hiring individuals with disabilities.

Part-Time Fixed-Term Contract

  • Can be for an indefinite duration or a specific period.
  • May be used as a bridge to permanent employment or for specific projects.
  • Includes provisions for individuals with disabilities.

Social Security Obligations

  • Company Registration: Employers must register with the Social Security system.
  • Opening and Closing Accounts: Employers must notify Social Security of new hires, changes in activity, or cessation of business.
  • Data Variation: Employers must update employee information with Social Security.
  • Contributions: Employers are required to make Social Security contributions.
  • Reporting: Employers must submit data and variations to Social Security, including income and salary information.

Fixed-Term Contracts for Specific Purposes

Education

  • For individuals acquiring theoretical and practical training.
  • Age limits and duration restrictions apply.
  • Specific provisions for individuals with disabilities.
  • Salary considerations and minimum wage requirements.

Practical Training (Prácticas)

  • For individuals who have recently completed vocational training.
  • Duration restrictions apply.
  • Salary is typically a percentage of an equivalent qualified worker’s salary.
  • Trial period limitations.

Specific Work or Service

  • For projects with a defined duration.
  • Must be in writing if the duration exceeds four weeks.
  • Maximum duration and notice period requirements.

Production Circumstances

  • To meet market demands or handle excess orders.
  • Can be oral unless the duration exceeds four weeks.
  • Maximum duration limitations.

Interim Contracts

  • To temporarily cover a vacant position.
  • Must be in writing and identify the worker being replaced.
  • Duration is tied to the reason for the vacancy.

Relief Contracts

  • For part-time work.
  • Requirements include being unemployed and having a specific type of contract or retirement status.
  • Maximum duration limitations.

Contracts for Victims of Gender Violence or Discrimination

  • Must be in writing.
  • Duration depends on the specific circumstances.
  • Eligibility requirements and financial assistance provisions.

Contracts for Individuals with Disabilities

  • For individuals with a recognized disability.
  • Eligibility requirements and duration limitations.
  • Bonus provisions based on disability, gender, and age.

Indefinite-Term Contracts

Ordinary Indefinite-Term Contract

  • No predetermined end date.
  • Can be oral or in writing.

Indefinite-Term Contract Promoting Indefinite Contracts

  • For individuals facing difficulties in the labor market.
  • Eligibility requirements and duration limitations.
  • May include specific subsidies or incentives.

Other Types of Contracts

Part-Time Contracts

  • Number of working hours is less than the standard.
  • Can be for an indefinite or fixed term.
  • Specific provisions for overtime and salary calculations.