Understanding Wage Structure and Employment Contracts
Understanding Wage Structure
The salary structure comprises two parts: the base salary and wage supplements.
- Base Salary: This is the fixed salary determined by working time (working hours, where performance is not considered). Remuneration may also be determined by work output, depending on the amount of work completed, not the hours worked.
- Salary Supplements: These are remunerations determined by specific circumstances, the situation of the enterprise, or worker characteristics.
Common Wage Supplements
- Seniority
- Transportation
- Extraordinary Payments
- Hazard and Toxicity
- Handling of Banknotes
- Night Shift
Gross Wages: Both the base salary and salary supplements are listed on social security.
Payments Exempt from Social Security
- Tips
- Severance or Relocation
- Per Diems
- Social Security Allowances
Forms of Employment Contracts
An employment contract can be written or verbal. A verbal contract, made with witnesses, has the same validity as a written contract.
Written employment contracts are required by statutory provisions, such as:
- Trainee Contracts
- Contracts for Work and Service
- Part-Time Contracts
- Temporary Contracts Lasting More Than 4 Weeks
Information Required in a Written Contract
- Identity of the parties involved.
- The starting date of employment. In the case of a temporary contract, the expiration date.
- The established company.
- The professional category or group of the employee.
- The amount of the base salary and wage supplements.
- Duration of the ordinary workday.
- Duration of vacation.
- Notice periods, if applicable, for both the employer and employee in the event of contract termination. (Note: Contracts less than one year do not require advance notice.)
Professional Classification
The professional category is an essential element of the employment contract. It largely determines working conditions, required tasks, salary, and the type of work performed.
A professional group brings together unified skills and qualifications of the worker, either specific or special. Several professional groups may exist within the same professional category, as the functions of one category may allow for the performance of another.
Within a professional group, there may be different professional categories and different functions or specialties.
Professional Groups According to Skills
Professional groups can be categorized into five major groups:
Group A: Degree and Diploma
The primary function is direct or indirect control.
Group B: Higher Qualification
Individuals in this group can lead teams, manage activities, and require a high level of professional knowledge.
Group C: Medium-Level Qualifications
This group includes school-level knowledge and skilled jobs with low autonomy.
Group D: Training and Practice
This group requires training and practice gained at the level of Compulsory Secondary Education (ESO).
Group E: Basic Knowledge
This group encompasses jobs requiring basic knowledge and little initiative.