Spanish Labor Law: Contract Types, Trial Periods, and Extra Pays

Types of Mandatory Law

Absolutely Mandatory Law: These legal rules do not allow any alteration, whether favorable or not to the worker. Examples include:

• Probationary period of one year for indefinite-term employment contracts in support of entrepreneurs
• Guarantees of salary
• Prohibition of employment of persons under sixteen years of age

Minimum Relative Mandatory Law: These legal rules impose the minimum conditions of employment favorable to workers. These legal rules do not permit worse working conditions. Examples include:

• The number of days of annual holidays (30 calendar days a year)
• The minimum interprofessional wage (2006-655,20€)

Maximum Relative Mandatory Law: These legal rules do not allow the setting of better working conditions (they are an exception). An example is the limits to the annual salary increases for civil servants determined by the annual Budget laws.

Dispositive Law: These laws allow any variation, either better or worse working conditions than those regulated by the dispositive law. For example, a Collective Bargaining Agreement (CBA) may establish the maximum duration of the trial period with precedence over the maximum duration provided by the law.

Trial Period

The probationary period is a period of time in which both contracting parties may know directly each other in order to assess if the labor relationship meets the requirements and needs of both. The trial period must be agreed in writing; otherwise, this pact is null and void.

The legal maximum duration of the probationary period is established by the applicable CBA. In the absence of a pact in the CBA, the duration of the probationary period shall be:

• 6 months for qualified technicians
• 9 months for senior executive staff
• 2 months for other workers
• 3 months for workers who are not qualified technicians in enterprises with less than 25 workers

The employer and the worker are respectively obliged to perform the actions making up the purpose of the probation. The pact establishing a probationary period shall be null where the worker has already previously performed the same functions in the Enterprise under any contract modality.

A distinctive feature of the trial period is that the employment contract may be terminated at the will of the employer without reason or cause at any time during the probation, so that the employee does not hold any right to severance pay (unless otherwise agreed). In spite of that, the termination of a contract during the trial period is subjected to some limitations.

Once the trial period has elapsed without terminating the contract, the agreement shall take full effect (and the dismissal must be for cause), with the period of the services rendered being included in the worker’s seniority in the Enterprise.

Finally, different situations such as temporary incapacity, maternity, adoption, among others, that affect the employee during the trial period, shall interrupt the computation of such period, provided that an agreement is reached between both parties.

Extra Pays (Bonuses)

Extra pays (or bonuses) are additional components to the basic salary, either in money or in kind. There are three types of extra pays:

1. Bonuses depending on the circumstances relating to the personal conditions of the worker. Examples: extra pays regarding seniority, skills, education of the employee, or stock options.
2. Bonuses depending on work done.
   1. Extra pays related to the characteristics of the work post. Examples: night work, shift work, hazard pay.
   2. Bonuses related to a higher amount or quality of work. These try to incentivize the worker to achieve higher levels of productivity or superior dedication to working activities. Examples: attendance bonus, surcharge for overtime work, or commissions.
3. Bonuses depending on the situation and profit and loss account of the company. These try to involve workers in the good course of the business. Example: gain-sharing bonus.

Consolidation Bonuses

These extra pays become permanent for the worker, not being possible their alteration or elimination in case of change of working conditions.