Exceptions to the Flat Rate on Contracts of Indefinite Duration in Spain

The reductions provided for in Royal Decree-Law 3/2014 shall not apply to several cases, which include:

  • Industrial relations of a special nature under Article 2 of the consolidated text of the Law of the Spanish Workers’ Statute or other legal provisions.
  • Contracts (affecting the spouse, parents, children and other relatives by kinship or affinity, up to the second degree (inclusive)), from the employer or those with corporate control who hold management positions or are members of the governing bodies of the entities or businesses that take the legal form of a business as well as those that are generated with the latter.

Considering the above exclusions, there are excepted cases described in the 10th provision of Law 20/2007, of July 11, of the Statute of Self-Employment. An exception is the recruitment by self-employed individuals of their children who are under 30 years old but living with the self-employed individuals. However, in this case, these persons do not have unemployment protection. The conditions of the same provision also apply to children who, although over 30 years old, may experience special difficulties in their employment (i.e. cerebral palsy, mental illness, or mental disability with a recognized degree of disability equal to or greater than 33% and physical or sensory disabilities with a recognized degree of disability equal to or greater than 65%).

  • The contracting of workers whose jobs establish their inclusion in any of the special systems within the general rules of the Spanish Social Security System.
  • The contracting of employees under the terms set out in Articles 20 (staff in the public sector), 21 (Public Employment Offer), the 20th provision (recruitment of staff for public corporations), and the 21st provision (recruitment of public sector foundations and committees) of the Law 22/2013 of December 23 on the General State Budget for 2014.
  • The contracting of workers who have been employed in other businesses that form the group of businesses and whose contracts were terminated either for objective reasons or disciplinary dismissal (that have been judicially declared unfair) or by collective dismissal in the six months before the execution of contracts that entitle the reduction.

Consistent with the requirements of the beneficiary companies, these concepts shall not apply in cases of dismissals occurring before February 25, 2014.

  • The contracting of workers who provided services in the same company or entity by a contract of indefinite duration in the six months preceding the date of the contract. Again, this excludes cases of workers whose employment contracts terminated before February 25, 2014.

For more information on indefinite-duration contracts in Spain,

Please note that this article is not intended to provide legal advice.

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