Spanish Court Rules Temporary Worker Entitled to Severance

Updated on
  • Madrid court says fired substitute worker must be compensanted
  • Decision could favor those who champion single contract type

A Madrid court ruled that a temporary worker who was fired without any severance pay must be compensated like a permanent staff member would be, bolstering the case for Spain to have a single type of labor contract.

The court said making a distinction between workers by contract type is a form of discrimination, applying the same criteria laid out in a European Union court ruling on Sept. 14. The decision means a temporary worker who was fired from the Ministry of Defense in 2012 from her job substituting a permanent staff member is entitled to about 6,000 euros ($6,712) in compensation. She sued her employer after she was initially denied severance pay due to her temporary contract.

The ruling could set a legal precedent for temporary workers in Spain, who generally work for lower pay and with less job security than their colleagues on permanent contract. Political parties, unions and business lobbies said they would wait for the interpretation of the EU ruling by Spanish courts. The decision can still be appealed in the next 10 days.

 “Any uncertainty about the current legal framework will definitely hurt hiring,”said Alvaro Zaldivar, an associate at Simmons & Simmons, a law firm, in Madrid.

Under the current Spanish labor legislation, workers on a permanent contract are entitled to compensation equivalent to 20 days per year worked if they’re fired. Temporary staff are given compensation of 12 days while substitute temporary workers aren’t entitled to any compensation regardless of the amount of time worked or duties carried out.

(Updates with comment from legal expert in fourth paragraph.)
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