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Last update 23-12-2020

Contracts. Salary. Self-employment

Types of employment contract

Employment contracts are regulated by the Workers’ Statute (ET)(Abre en nueva ventana) .

Depending on their duration, employment contracts may be:

  • Permanent/indefinite

    • Permanent intermittent contracts (Article 16 ET).

  • Temporary

    • To work on a project or carry out particular services. (Art. 15.1.a) ET)

    • Temporary contracts, due to circumstances generating an accumulation of work or excess orders (Art. 15.1.b) ET)

    • To replace workers who have the right to reserve their jobs, provided that the employment contract specifies the name of the replaced worker and the reason for the replacement (Art. 15.1.c) ET).

Depending on the agreed working hours, contracts may be:

  • Full time

  • Part time (as described in Articles 12 and 16 ET)

The employment contract types established in the Workers’ Statute are set out below: ( Articles 10-13(Abre en nueva ventana) )

The Labour Guide(Abre en nueva ventana) provides information about the characteristics of each type of contract.

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Content of employment contracts

The contracts will contain the following information:

  • The names of the parties to the employment contract.

  • The starting date of the employment relationship, and in the case of a temporary relationship, its foreseen duration.

  • The registered office of the company or, as the case may be, the address of the employer and the workplace where the worker will normally provide their services. When the worker normally provides their services in different workplaces or in mobile or itinerant workplaces, it is necessary to record such circumstances.

  • The professional category or group for the job carried out by the worker or the characterisation or a brief description of the same, in terms that make it possible to know in sufficient detail the specific content of the work.

  • The amount of the initial basic salary and wage benefits, and their payment frequency.

  • The duration and distribution of the normal working hours.

  • The duration of the holiday leave and, as applicable, the methods used to allocate and determine such holiday leave.

  • The notice periods that the employer and worker are obliged to comply with in the event of the contract termination, or if it is not possible to provide this information at the time of delivering the information, the manner in which such notice periods are determined.

  • The collective agreement applicable to the employment relationship, describing the specific data that enables its identification.

This matter is regulated by Royal Decree 1659/1998 of 24 July 1998 implementing Article 8(5) of the Workers’ Statute Act on informing workers about the basic elements in their employment contracts(Abre en nueva ventana) .

Salary

What is meant by salary?

Salary refers to all the economic benefits paid to workers, in cash or in kind, in return for the professional provision of their services as salaried workers, whether paid for effective work, regardless of the remuneration methods, or in the form of rest periods that count as working time.

Under no circumstances, including special employment relationships, may the salary in kind exceed thirty per cent of all the salary benefits of the worker, nor may it give rise to the amount received in cash being less than the minimum guaranteed interprofessional wage.

The following items are not considered as salary:

  • amounts received by the worker as compensation or substituted by expenses incurred as a consequence of their professional activity;

  • Social Security benefits and compensation and

  • indemnities paid in the event of transfer, suspension or dismissal.

The above is regulated in Article 26 of the Workers’ Statut(Abre en nueva ventana) e.

For more information, consult the Labour Guide(Abre en nueva ventana) .

 

Minimum and average salary

The minimum guaranteed interprofessional wage is that set by the Government, after consultation with the most representative trade unions and employer associations. No worker who works a full time may receive a salary that is less than the minimum guaranteed interprofessional wage.

The average salary is the result of the statistical salary analysis; there is no legal concept of average salary.

This matter is regulated in Article 27 of the Workers’ Statute(Abre en nueva ventana) .

For more information, consult the Labour Guide(Abre en nueva ventana) .

 

What are the decisive factors used to establish the salary?

To establish the annual minimum guaranteed interprofessional wage, the following factors are taken into account:

  • The Consumer Prices Index.

  • The average national productivity.

  • The increase of the share of labour in the national income.

  • The overall economic outlook.

This matter is regulated in Article 27 of the Workers’ Statute(Abre en nueva ventana) .

For more information, consult the Labour Guide(Abre en nueva ventana) .

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Self-employment

These are individuals who normally carry out an economic or a professional activity in return for a profit personally, directly, on their own account and outside the scope of the management and organisation of another person, whether or not they provide employment to salaried workers.

The Labour Guide provides information relating to:

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Authority responsible for the information

Ministry of Labour and Social Economy
Directorate-General of Labour