SPAIN Law and Practice Contributed by: José Antonio Segovia, A&O Shearman
1. Employment Terms 1.1 Employee Status
• the transformation of temporary contracts into indefinite contracts; • contracts for associated assistance ( contrato de auxilio asociado ); • co-operation contracts; and • contracts of employees who work remotely. Duration of the Employment Contract An employment contract is presumed to last, in gen - eral, for an indefinite period. In order to conclude a fixed-term contract, it is necessary to specify pre - cisely the exact and detailed terms of the temporary contract, the specific circumstances that justify it and its connection with the expected duration. Currently, there are only two circumstances where fixed-term contracts are allowed: • due to production circumstances; or • in order to temporarily replace an employee. Temporary contracts due to production circumstances A fixed-term contract due to production circumstanc - es may not last more than six months (extendable by another six months), and it must be in response to the occasional and unforeseeable variations that generate a temporary imbalance of employment in the com - pany. Contracting for a period determined by circum - stances of production would also include contracts for occasional, foreseeable situations of reduced duration and delimited within the fixed contract, duly identified in the contract. They may be used for a total of 90 days, but never consecutively. Temporary contracts to replace employees A fixed-term contract to replace an employee may be concluded if the employment of that employee has been suspended with a specific right to be reinstated in their position, to cover the reduced working day for legal or conventional reasons, as well as to fill vacan - cies during a selection process. In the last of these cases, the duration of the contract shall not exceed three months. Training contracts Training contracts now come in two forms.
Generally, companies in Spain hire employees through an ordinary employment relationship. There are some distinctions between senior executive employment contracts and ordinary employment relationships. Executive contracts are regulated under Royal Decree 1382/1985 of 1 August 1985. Executives are defined as managers who exercise powers inherent to the legal ownership of the company and relating to its general purpose, limited only by the decisions and instructions of the person(s) in charge of the company. These employment relationships have fewer regulated rights. Ordinary employment relationships are regulated under Royal Legislative Decree 2/2015, of 23 October, approving the revised text of the Workers’ Statute Act. 1.2 Employment Contracts There are different types of employment contract in Spain depending on the form, duration and nature of the relationship. Employment relationships may be distinguished by the number of hours worked by the employees (eg, part-time or full-time employment contracts with the same rights). Form of the Employment Contract The principle of freedom of form applies to employ - ment contracts, which may be entered into either ver - bally or in written form. Verbal employment contracts are generally considered to be indefinite. However, the following employment contracts must be made in writing: • temporary contracts; • contracts for employees hired through temporary employment agencies; • relief contracts to replace partially retired employ - ees ( contratos de relevo ); • part-time contracts; • indefinite contracts that may be subject to interrup - tion; • contracts with employees hired in Spain for Span - ish entities operating abroad;
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