Guide to types of work contracts in Spain

Indefinite contracts (Indefenido)

This category includes the normal indefinite contract as well as several types of indefinite contracts with government incentives. The main characteristics of the normal indefinite contract are:

In the absence of any other formalized contract type, the contract is presumed to be normal indefinite
Severance pay for improper dismissal is a maximum of 45 days salary for every year worked, up to a maximum of 42 months equivalent salary
There are no Social Security subsidies or any other financial incentives

Indefinite contracts with incentives may be used when hiring:

Workers over 45 who have been unemployed for at least one year
Women unemployed for more than a year who have been hired for work in sectors where women have been traditionally under-represented
Workers between the ages of 30 and 44 who have been unemployed for more than a year.
Unemployed workers under 30 years of age. Workers with disabilities

The main characteristics of an indefinite contract with incentives are:

Severance pay for improper dismissal is 33 days salary for each year worked with a maximum of 24 months equivalent salary
Subsidies of up to 75% from the employer’s social security contribution
Tax benefits

The indefinite contract is like a gilt-edged contract in Spain which is why they are becoming increasingly rare – especially in the current financial climate.

An indefinite entitles an employee to all sorts of state rights including healthcare for the whole family – even if only one parent is working. Further, employers cannot fire an employee without going through the proper channels and also making significant compensation relating to the amount of time you have worked within the company.

Temporary contracts

A contract for a specific project or service arranged for the purpose of performing work or providing a service which is temporary but of uncertain duration.
Casual contract due to production overload or backlog. The maximum duration of this type of contract is six months in any twelve-month period.
Contract to sit in for employees entitled to return to their job. The duration of this contract is the period during which the absent employee retains the right to return to his or her job.
Work experience contract. This contract can be arranged with university or junior college graduates or persons with vocational qualifications or recognised equivalent qualifications, provided that not more than four years have elapsed since they completed the related training. The duration is from six months to two years.
Trainee contract. This type of contract can be arranged with workers aged 16 to 21 who do not have the necessary qualifications to obtain a ‘work experience contract’. The duration of this contract ranges from six months to two years, although it may be extended to three years by a collective labour agreement.

Transitory employment needs may be met through workers provided by temporary work agencies.

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