Thursday, November 26, 2009

Severance in Spain

Spain has very strict employee protection laws. This means

1) Lots of strikes. Last year the truckers went on strike and shut down the country. Gas stations were empty, store shelves bare.

2) It sucks to be young, because no one will hire you full time (it seems like half the country works on temporary contracts)

3) Everyone is in a union

Since I work with computers, I'm in the metalworkers union. Is silicon a metal? They get 0.1% of my salary for doing nothing. Thanks.

If you get laid-off (as a full time employee), you get a severance package consisting of a minimum of 45 days of salary per year worked up to 3.5 years pay (many companies give more), unless you are fired. You REALLY have to try to get fired. There was a recent court case that decided that even swearing publicly at your boss was insufficient grounds for firing.

The Spanish legal system arrived at this 45 day payoff somewhat indirectly. Termination without cause used to be arbitrated in court, with a maximum penalty of 45 days of pay per year worked. A small rule change allowed companies to just pay the 45 days without going through the hassle of the court system.

If you come here from abroad via an intra-company transfer, remember to get a rider attached to your employment contract stating that they recognize your time abroad as part of your employment history.

This also means that if you've worked somewhere for a while, you don't want to leave (and potentially lose a huge amount of severence?).

There is some legal gray area concerning whether performance based stock grants count as part the salary for severence purposes. Companies now try to protect themselves by refusing to providing any written justification for stock grants.

No comments: