Illegal Transfer of Workers in Spain: Know the Risks?

Although it is common practice for companies in Spain to transfer workers illegally, it is prohibited and punished by law. Article 43.1 of the Workers’ Statute stipulates that companies can only temporarily assign workers to another company through authorized temporary employment agencies, as legally specified.

An illegal transfer of workers occurs when a company, referred to as the transferor company, hires a worker to work exclusively for another company, known as the transferee company. If the transferor company is not a temporary employment agency (TEA or empresa de trabajo temporal, ETT in Spain), it violates the law by providing the transferee company with labour. The transferee company is responsible for the planning, organization, direction, and controlling of the employee, although he is an employee of the transferor company. It means that the transferee company must comply with all legal and contractual obligations, including payment of wages, taxes, and social security contributions.

Characteristics of the illegal transfer of workers

• The transferee company, not the company that contracted the worker, sets the working hours and schedule
• The transferee company determines and manages the employee’s holidays
• The employee follows the directives and instructions of the employer and is accountable to their management
• The employee typically provides services on the premises of the transferee company.
• Consequences of the illegal transfer of Workers

For the workers

• Failure to comply with legal obligations regarding health and safety at work, holidays, and wages
• Failure to comply with legal obligations regarding social security
• Civil and criminal liability for transferor and transferee companies in the case of workplace accidents or failure to comply with legal obligations regarding health and safety at work.
• Administrative and economic sanctions for transferor and transferee companies. Illegal agency work is a severe offence under the Law on Infringements and Sanctions in the Social Order (LISOS), resulting in fines ranging from €7,501 to €225,018
• Lack of worker protection as they may not know who to turn to in the event of problems

For the employees

Consequences for employees of illegal worker transfers include

• The right to acquire permanent status, if the contract was a temporary one
• The option to belong to both the transferor and the transferee company

If the dismissal is unlawful, the worker can choose to work for any of the two companies.

Workers choosing to join the transferee company are entitled to the same working conditions as other workers in the same position; the company will calculate their seniority from the beginning of the illegal transfer period.

In Spain, only temporary employment agencies can hire temporary staff and place them at the disposal of another company.

Carlos Rivero

If you need additional information regarding the illegal transfer of workers in Spain,