Summer is upon us and our employees’ main holiday season will soon be here. You could be faced with disruptions in your company’s business activity and the staff available, so you must resort to using temporary employment contracts in order to fill some vacancies; but which type of contract is the most suitable?
Obviously, due to a clearly temporary need, such as merely filling a vacancy during a brief and specific period of time, you do not want to run any risks or that the employee acquires the position of a permanent worker that would unnecessarily increase your staff structure or, of course, run a risk of fines being imposed.
Is there any employment contract that would allow me to cover holidays based on this situation?
Since the recent labour reform came into force the answer to this question is YES THERE IS, the contract for production reasons.
Since the new regulations came into force, the doubts we could have had up to such time about which of the terminated contracts was the right one (i) a temporary contract or (ii) a temporary contract for production reasons, have been resolved. This issue also went back and forth in case law doctrine and hence led to insecurity and risks.
The doubt has now been clarified for this summer because the new temporary contract for production reasons expressly includes covering holidays and, although there are many issues in the labour reform that could be subject to interpretation, this one in particular does not seem to be one of them.
The Spanish Labour Relations Act allows this contract to be entered into when there are fluctuations that, even though they are related to the company’s normal business activity, could cause a temporary imbalance between the stable staff available and those required, holidays being expressly included in such fluctuations in Article 15.2 thereof:
“Among the fluctuations referred to in the previous paragraph, those caused by the staff taking their annual holidays shall be deemed to be included.”
Therefore, since the regulation is clear, it is better not to hesitate and resorting to any other type of contract should be avoided.
Practical issues for the formalities of the contract:
Having clarified the suitable type of contract, what practical issues should I take into account to correctly carry out the formalities and not run any of the risks mentioned?
1. It is very important to clearly specify the reason for the temporary nature of the contract, i.e. to cover the staff’s holidays, but not in a generic manner, the following must be specified:
- The full name of the employee who is on holiday and,
- The period he/she will take these holidays.
2. It is also crucial that the term of the contract for production reasons (fluctuations) is the same as the holiday period it is intended to cover; under no circumstances may it exceed the employee’s holiday period.
NB! These practical words of advice are very important because if they are not observed the temporary reason could be deemed to “no longer exist”, the contract would be considered to have been entered into fraudulently and it would become permanent with the consequences that would entail.
Lastly, the following should be taken into account:
An important point to consider when planning the next recruitments is that “short-term” contracts, of less than 30 days, also require an additional contribution of €27.53 payable by the employer at the time of their termination.
The only exceptions are farm workers, domestic, mining and coal employees and substitution contracts.