Termination of Employment in Spain: Causes and Types
Termination of Employment in Spain
Grounds for Termination
Employment contracts in Spain can be terminated for various reasons, including:
- Mutual consent: Both the employer and employee agree to end the contract.
- Contractual grounds: Reasons explicitly stated in the employment contract.
- Expiration of contract term: For fixed-term contracts, the contract ends on the agreed-upon date.
- Employee resignation: The employee voluntarily chooses to leave.
- Death or permanent illness: Of the employee.
- Employee’s retirement.
- Employer’s death: In certain circumstances.
- Force majeure: Unforeseeable events that make it impossible to continue the employment relationship.
- Collective dismissal: Based on objective grounds (economic, technical, organizational, or production-related).
- Employee’s voluntary departure: The employee leaves, potentially with consequences depending on the contract.
- Dismissal of the employee: Termination by the employer, with or without cause.
- Employee’s desire to cease work: Specifically for employees who have suffered gender-based violence.
Termination of Definite-Term (Fixed-Term) Contracts
Fixed-term employment contracts automatically end upon the expiration of their fixed term. If the employment relationship continues beyond the agreed term, the contract may be deemed to have been extended for an indefinite period, effectively becoming an indefinite contract. When the duration of a fixed-term contract exceeds one year, the party wishing to terminate the contract must give a minimum of 15 days’ notice.
Termination of Ordinary, Indefinite-Term Contracts
Ordinary employees (those with indefinite-term contracts) may only be dismissed *with cause* after any trial period has expired. During the trial period, either party may terminate the contract freely.
Disciplinary Dismissals
Disciplinary dismissal is justified by serious employee misconduct. Grounds for disciplinary dismissal include:
- Repeated and unjustified lack of punctuality.
- Lack of discipline or disobedience at work.
- Verbal or physical aggression towards the employer or other staff.
- Breach of good faith and abuse of confidence.
- Intentional and continuous reduction of regular work performance.
- Drunkenness or drug addiction negatively affecting work performance.
- Harassment of the employer or staff by reason of racial or ethnic origin, religion, conviction, disability, age, or sexual orientation.
Disciplinary dismissal must be communicated to the employee in writing, stating the facts giving rise to the dismissal and specifying the effective date of termination.
Objective Dismissals
Objective dismissals are not related to employee misconduct but are based on one or more of the following objective reasons:
- Employee’s incompetence: That has come to light or arisen *after* the trial period has elapsed.
- Employee’s failure to adapt: To reasonable technological developments affecting their position.
- Employee’s absence from work: Even if justified, exceeding 20% of the workdays in two consecutive months, or exceeding 25% of the workdays in any four months within a 12-month period (chronic absenteeism).
- Need to phase out job positions: Based on organizational, productive, economic, or technical grounds.
If an objective dismissal is declared unjustified by a court, the employer has the option to either immediately reinstate the employee with back pay or terminate the relationship (paying appropriate compensation). If the dismissed employee is an *employee representative*, the *employee* chooses between reinstatement and termination.
Collective Dismissals
Specific procedures must be followed for collective dismissals. These apply when, in any 90-day period, the number of employees to be dismissed for economic, technical, productive, or organizational reasons equals or exceeds:
- 10 employees in companies with fewer than 100 employees.
- 10% of the workforce in companies with 100 to 300 employees.
- 30 employees in companies with 300 or more employees.
- All employees in companies with over 5 employees, when the entire business activity ceases.