Dismissal of Spanish Employees

Updated on Monday 26th March 2018

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The Spanish labor legislation contains the main regulations related to the dismissal of employees and the main rules that must be known by every employer registered in Spain, no matter if the company has foreign ownership or not. The labor legislation also takes into account the procedures that have to be followed during the dismissal of the Spanish employees, who can be fired in specific conditions.

It is important to know that if the legislation in the field is not respected as prescribed, the employee can sue the employer and ask for compensations. The compensation can vary depending on the manner in which the employee was fired, his or her position within the company and other similar aspects. Our team of lawyers in Spain can assist local and foreing businessmen with in-depth advice on the regulations concerning the dismissal of Spanish employees.

Types of dismissal in Spain

An employment contract can be terminated by dismissal (representing an unilateral decision taken by the employer) and it can be individual (for one employee) and collective (for more employees). The latter category is more difficult to apply than the first because there are certain conditions to be met.

More details on the dismissal of Spanish employees are presented in the video below:

Firstly, before a collective dismissal, the legal representative of a company must verify if there are good reasons for taking the decision to fire more employees and this could refer to aspects such as:

• economic grounds;

• organizational grounds;

• technical grounds;

• production reasons.

Collective dismissal in Spain

The collective dismissal is a method to relaunch a business that has difficult economic problems and the activity cannot be sustained with the current number of employees.

A dismissal is collective when certain conditions are met:

• if minimum 10 employees of the total number of employees (in companies with maximum 100 employees) are to be dismissed;

• if at least 10% of the employees (in a company which hires 100-300 persons) are to be fired;

• when the owners of a company having over 300 employees are going to fire minimum 30% of the workers (depending on the difficulties encoutered by the company, the collective dismissal can reach 100% of the total number of employees).

Before dismissing the employees, the representatives of a company must begin an administrative procedure and the labor authorities will verify if there are good reasons for a collective dismissal. The authorities will verify whether the respective problem can be solved through another manner.

If the conclusion is to dismiss the employees, they should receive an indemnity that is regulated by the law and it can’t be less than the wage for 20 days per every year of service and it can’t be more than 12 monthly wages.

The employee who is not satisfied by the manner in which he or she was dismissed can file an appeal against the employer’s decision. Our team of Spanish lawyers can offer legal assistance on the court procedures available in this case.

Dismisal of pregnant employees in Spain

As a general rule, when firing employees in Spain, employers will not be able to dismiss pregnant or breastfeeding employees, as mentioned by the Article 55.5 of the Workers Statute. In the situation in which the employer was informed regarding the presence of a pregnancy, the company will not be allowed to fire the respective person. However, a pregnant woman may be fired under several legal grounds, that are not related to her pregnancy, as follows:

• disciplinary reasons;

• a difficult economic situation of the company, which can no longer pay its employees.

If the person will still be dismissed, the company is required to provide termination payments above the statutory amounts, and this can also be available for other categories of employees.

If you need more details about how a dismissal can be appealed in justice and other information about the dismissal of employees, you may contact our law firm in Spain. Our local lawyers provide a wide range of legal services for foreign investors who are interested in doing business in Spain.