Contracts for works and services

The works and services contract is one of the most commonly used contracts within the Spanish labour framework. In fact, it is also one of the contracts that has been part of the labour legislation in our country for the longest time. Here we would like to tell you everything you need to know about it.

Elements defining a works and services contract

This type of contract has a number of defining characteristics. Specifically, it is signed for the purpose of having a worker perform certain tasks related to a project which, although of limited duration, it is not possible to predict with certainty when it will end. It is therefore somewhere between a temporary contract and an open-ended contract.

Moreover, it is indispensable that the work or service for which the contract is formulated has its own substantive nature within the company. This means that, if the project ends, but the company wants to continue using the worker's services, it will need the worker to sign a new contract.

This is a very common contract model in the construction, cleaning and telemarketing sectors, for example. For the worker, it has the advantage of knowing that he or she will be employed for a relatively long period of time. However, many companies use it as a permanent contract. And, obviously, the latter offers many more benefits for the worker.

In fact, Spanish law prohibits the use of this type of contract for the performance of the same tasks that, within a company, are carried out by other workers with an indefinite contract. In addition, workers linked to a company through this formula must have preference when it comes to applying for vacancies involving the signing of permanent contracts.

Elements that must appear in the drafting of this type of contract

There are two elements that must necessarily appear in contracts drawn up for the performance of works or services. They are as follows:arecer en los contratos redactados para la realización de obras o servicios. Son estos:

• Clear and detailed statement of the work or service for which the worker is required. In this regard, it is essential to attach the official temporary contract model of the Ministry of Employment. If this is not done, the contract will be considered a full-time, indefinite-term contract.
• The deadline for registering the contract with the corresponding employment office is a maximum of 10 days from the time the contract is signed. If the contract is not registered, it becomes legally invalid.

Is there a maximum duration?

Since the implementation of the 2010 labour reform, there is a time limit for contracts signed for the execution of works and services. This was not the case before.

Specifically, the current legislation specifies that the maximum duration of this type of contract is 3 years. In addition, it provides that it may be extended for a further 12 months provided that the collective agreement of the profession to which the company belongs so provides. In any case, once that time has elapsed, it will have to be dissolved or it will automatically become indefinite. 

This was done with the aim of preventing companies from abusing this formula to avoid signing open-ended contracts, although it is true that, at the same time, this labour reform and the following one made the dismissal of permanent workers much more flexible.

Is there a right to a severance payment when the contract is terminated?

Obviously, a severance payment is provided for by law in the case of work and service contracts. In this regard, this issue is defined in Article 49.1 c) of the Workers' Statute. Specifically, it provides that workers who carry out their activity linked to a company by means of this type of contract are entitled to receive, upon termination, a severance payment of 12 days per year of work. However, there are specific regulations within various collective agreements that provide for higher severance payments.

This fact, as well as the temporary nature of this type of contract, was not specified in the previous legislation. This led to the subsequent addition of an additional text relating to this issue. Specifically, it is the Thirteenth Provision of the Workers' Statute, which states the following:

• Contracts concluded before 31 December 2011: 8 days' severance pay per year worked.
• Contracts concluded before 31 December 2012: 9 days' severance pay per year worked.
• Contracts concluded before 31 December 2013: 10 days' severance pay per year worked.
• Contracts concluded before 31 December 2014: 11 days' severance pay per year worked.
• Contracts concluded before 31 December 2015: 12 days' severance pay per year worked.

As of the latter date, the answer to the question whether workers under this type of contract are entitled to a severance payment equivalent to 12 days per year worked can be yes.

The controversy surrounding contracts for the performance of works and services

There is no doubt that, over the last decades, these contracts have been among the most interesting for employers. After all, they offered them the opportunity to benefit from the services of a worker hired for a limited duration who, de facto, served as a permanent worker.

By this we mean that a worker under a contract for the provision of works and services who, for example, was a bricklayer, could only work in a building under construction, which is the one that has to appear in the document. However, throughout this time, employers have taken advantage of the situation to send them to other workplaces. The aim? To avoid their obligations with regard to permanent contracts.

Although this is still done, it is an illegal and fraudulent practice that can have consequences. In fact, if the worker decides to claim, once the work for which he/she was hired has been completed, his/her status as a permanent employee and manages to demonstrate that his/her rights in this matter have been violated, he/she may request a claim equivalent to that which he/she would be entitled to for unfair dismissal if he/she had signed a permanent contract. You may also choose, provided that the employer agrees and does not opt for the previous option, to transform your contract into a permanent contract.

Conclusions

In short, the contract for works and services, despite having been designed to fulfil a very specific function, has become too widespread over the last few decades, which has also been possible due to the fraudulent intention of many employers.

However, in spite of the more flexible dismissal conditions for permanent employees, workers still have a multitude of rights in this area that are worth preserving. And, for this, on most occasions, the services of a specialised employment lawyer are necessary to handle the case and demonstrate the irregularity that has occurred. A process from which the worker usually comes out well in many cases.