Royal Decree-Law 32/2021 officially entered into force on December 31, 2021.

The last labor law reform in Spain was in 2013 (Rajoy Law 3/2012 of December 22, 2013).

Approval Awaited by the Spanish Congress

According to Article 86 of the Spanish Constitution, decree-laws must be submitted to the Congress (the equivalent of the National Assembly in France) within 30 days for approval or rejection.
In this case, the Congress has until February 7, 2022, to decide on the reform.

Yolanda Díaz, Minister of Labor and Social Economy, stated that "We need a new labor standard to put an end to the inefficient and unfair functioning of the labor market."

However, this reform has been widely considered too weak and lacking in the fundamental reform of labor law that the government had announced.

The main measures of the reform

The main changes in this reform can be summarized in a few points:

  • The open-ended employment contract becomes the standard contract, as is already the case in France.
  • Fixed-term contracts: contracts for a specific job or service are eliminated. The only fixed-term contracts that can now be concluded are those for a temporary increase in activity or to replace an employee. Penalties are strengthened and can reach up to €10,000 in fines per employee when the use of this type of exceptional contract is unjustified.
  • Apprenticeship training contracts (formerly called "training and apprenticeship contracts"): these can also be concluded with university students who are not undertaking vocational training, as is already the case in France. This type of contract is reserved for those under 30 years of age, for a maximum duration of two years. Remuneration is set in accordance with the collective agreement and cannot be less than 60% of the collectively agreed wage in the first year and 75% of the collectively agreed wage in the second year. In any case, remuneration must be at least equal to the national minimum wage.
  • Training contract for acquiring professional experience (formerly called an "internship contract"): this can be concluded up to three years after obtaining the diploma (previously five years) and will have a duration of between six months and one year (previously between six months and two years).
  • Continuous open-ended contract: concluded for seasonal work or work related to seasonal activities, but also for the execution of work with a fixed or indefinite period of execution.
  • ERTE ("Expediente de Regulación Temporal de Empleo"): equivalent to partial unemployment in France. Processing times are shorter and procedures are simplified.

Entry into force and adaptation period

The reform does not affect contracts already in effect on December 31, 2021, and is not retroactive.

For contracts signed after the reform's entry into force (i.e., December 31, 2021), companies have three months to adapt temporary contracts and six months to eliminate employment and service contracts.

In France, the most recent major labor law reforms were the « Loi Travail » of August 8, 2016, and the Macron Ordinances of September 22, 2017. These ordinances notably include: strengthening collective bargaining at the company level (precedence of company agreements over industry-wide agreements, simplification of agreements for small businesses);

the merging of employee representative bodies into a single body; securing the procedures for terminating employment contracts (requirement to state the reasons for dismissal in the dismissal letter, provision of standard dismissal letter templates, establishment of a scale of damages, etc.); and the creation of the open-ended project-based contract.

News : Final adoption of the reform

The reform of Spanish labor law was finally approved by Congress this Thursday, February 3.

The final count shows 175 votes in favor and 174 against the reform, with only one vote separating the two sides.

The legitimacy of this vote has, however, been called into question because Alberto Casero, a PP deputy from Cáceres, mistakenly voted in favor of the reform.

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