The much-discussed labor reform

The validation of the labor reform by the Congress of Deputies, which had already seen the light of day in Royal Decree Law format on December 28, may go down in history as the most disputed in recent times, although this is due to reasons totally unrelated to its content of which little has been said prior to its hectic approval. Next, the six main ones on which the much-discussed reform deals are highlighted.

• Training contracts  : the training contracts are re-titled and redefined: the apprenticeship contract becomes alternating training (it makes work activity compatible with training processes), and the internship contract becomes for obtaining the internship professional whose duration is limited to one year.
• Temporary hiring:  as Spain had promised with Brussels within the framework of the Recovery, Transformation and Resilience Plan presented in July 2021, the new regulation wants to decisively tackle the reduction of temporary employment, one of the scourges of our labor market. To do this, the possibility of resorting to the contract for a specific work or service is eliminated and the regime of the contract is modified due to production circumstances. The old interim contract is replaced by the substitution contract, expanding its scope of application to situations protected by law (reduction of working hours). Likewise, the sanctions for fraudulent temporary hiring that will be imposed from now on for each employee are toughened.
• Discontinuous permanent contracts:  clearly the legislator chooses to promote this figure to the detriment of temporary contracts. It can be agreed to carry out seasonal work or work linked to seasonal activities, for the development of activities that do not have such a nature but that, being intermittent, have certain, determined or indeterminate execution periods. They may also be used for the execution of contracts that, being foreseeable, form part of the ordinary activity of the company.
• ERTE and RED mechanism:  collecting the experience acquired in the regulations on the matter during COVID, the regulation of force majeure ERTEs is modified. The so-called RED mechanism for flexibility and stabilization of employment is also created, with two modalities, the cyclical and the sectoral, which must be activated by the Council of Ministers. A fund is included to finance the benefits and exemptions from social security contributions and the financing of training costs.
• Collective bargaining:  the applicable priority of the company agreement over the sectoral agreement is maintained, except for what is related to the amount of salary. The ultra-activity of the collective agreement is recovered, that is, once the duration of an agreement ends without there being an agreement on a new one, the previous one will be maintained.
• Subcontracting of services:  the preceding regulations are fundamentally maintained, and it is clarified that the applicable collective agreement for the contracting companies will be that of the sector of the activity carried out in the contract. Although the negotiation of this labor reform began with a very ambitious program from the union perspective, many issues have been sacrificed in favor of the agreement of the negotiating parties, the latter effort that perhaps has not had the reception it deserved.