Employment Termination and Contract Changes: Legal Rights

Employment Termination and Contract Changes

Termination of Employment

Termination occurs due to various factors, including economic, technical, organizational, or staffing production issues.

• Group Termination: Based on the number of employees affected (e.g., 10-300 employees requires a minimum 10% reduction; 300+ requires 30%). Indemnity is 20 days per year of service, capped at 12 monthly payments.
• Objective Causes: Requires written communication, 20 days' indemnity per year (max 12 months), and 30 days' notice. Employees are entitled to 6 hours per week to seek new employment.
• Disciplinary Dismissal: Based on unjustified repeated faults, verbal abuse, or decreased productivity. A written letter is required.

Conciliation and Legal Claims

If an employee disagrees with a dismissal, they must file a conciliation demand within 20 working days. This process may result in a settlement (e.g., 35 days' indemnity per year and unemployment benefits).

Classification of Dismissals

• Fair Dismissal: Causes are proven. Indemnity is 20 days per year (max 12 months).
• Unfair Dismissal: Causes are not proven. The employer has 5 days to choose between:
  • Reinstating the worker.
  • Paying 45 days' indemnity per year (max 42 monthly payments).

Transfers and Modifications

• Individual Modification: Requires 30 days' notice.
• Collective Modification: Requires a consultation period and 30 days' notice.
• Temporary Displacement: Moving to a different location for up to 12 months within a 3-year period.

Suspension of Contract

Temporary interruption of labor without extinction. Causes include mutual agreement, forced leave, temporary incapacity, or maternity/paternity.

Leave of Absence (Excedencia)

• Voluntary: Requested by the worker (min 2, max 5 years).
• Forced: Due to public office duties; the job is reserved.
• Family Care: Up to 3 years for child care or 1 year for family care.

Extinction of Contract

Can occur via mutual agreement, voluntary resignation, or other causes like retirement or death.

• Resignation: Requires notice; failure to provide notice may lead to claims for damages.
• Justified Resignation: Entitles the worker to 45 days' indemnity per year (max 42 months).

Settlement (Finiquito)

The final payment issued when a contract is terminated.