Validity of the work or service contract linked to the duration of the contract

The contract of work or service determined may be linked to the duration of the contract to which the worker is attached. However, when this duration is unusual and particularly long,due to extensions and novations of the same; the object of the contract of work or service determined loses its own autonomy and substance, so it must be understood to have become indefinite.

Temporary hiring linked to a contract

In June 2003, a worker signed a construction or service contract for a telemarketing company linked to the client company’s telephone support campaign. The service had been contracted under a commercial contract initially concluded in December 1998, with subsequent novations occurring in April-2004 and August 2009. After the campaign with the client company, the telemarketing company informs the worker of the termination of her employment relationship, with effect from December 31, 2013, a decision against which the worker presents demand for dismissal.

The High Court of Justice of Andalusia, reversing the judgment of dismissal, declares that the termination of the contract at the end of the contract, constitutes an unfair dismissal. Therefore, the company appeals in cassation for the unification of doctrine, maintaining that it is possible to maintain the temporary nature of the employment relationship throughout the duration of the contract, as established by the doctrine established in the Supreme Court in June 20085.

The question that arises is whether it is lawful to terminate a contract for a particular work or service, following the termination of the contract that motivated it and that had been the subject of several renewals.

The Supreme Court has been accepting the legality of the link of the contract for work or service to the duration of the contracts,extending its duration for the time covered by the contract, provided that there is no interpository fraud. In this regard, it has been pointed out that, as long as the same contractor is the holder of the contract, either by extension or by new award, it cannot be understood that the employment relationship has come to an end.

However, it must be borne in mind that, in any case, all the basic elements that naturalise this type of fixed-term contract must be maintained, in order to prevent the abuse of this type of temporary contract. For the validity of the contract for a given work or service, the following requirementsmust be met simultaneously:

that the work or service that constitutes its object has its own autonomy and substance within the work activity of the company;
that its execution, although limited in time, is in principle of uncertain duration;
that the contract specifies and identifies, with precision and clarity, the work or service which constitutes its object;
that in the development of the employment relationship, the worker is normally occupied in the execution of that or in the fulfillment of this and not in different tasks.

When the contract of work or service determined is linked to a contract of unusual and particularly long duration (14 years in this case), due to extensions and novations of the same, its object loses its own autonomy and substance, and becomes over the years in normal and permanent activity of the contractor company. The cause that enabled the temporary contract ceases to exist and the fulfillment of the resolutory condition is postponed indefinitely, which results in the novation of temporary contracts in indefinite.

For this reason, the Supreme Court dismisses the appeal in cassation for the unification of doctrine, and declares the finality of the judgment under appeal, which recognized the inadmissibility of the dismissal.

note

1) In the same vein, you can find more sentences: TS 19-7-18, TS 19-7-18 and TS 19-7-18.

2) The judgments resolve cases regulated under the wording of article 15.1.a of the ET prior to RDL 10/2010, at which time a maximum duration of the work or service contract was not established.

Currently the maximum duration of the work or service contract is 3 years, extendable up to 12 more months forcollective agreement.

Nuance of doctrine

Judgment of the Supreme Court in February 2018 (TS 20-2-18)

This judgment warns that it is lawful to link the contract for work or service to the duration of a contract, extending its duration for the time covered by the contract, provided that there is no interpository fraud. As long as the same contractor is the holder of the contract, either by extension or by new award, it cannot be understood that the employment relationship has come to an end.

Judgment of the Supreme Court in July 2018 (TS 19-7-18)

This judgment establishes that contracts for the specific work or service concluded before 18 June 2010 – when a maximum duration of this type of contract was not established – which are linked to a contract for unusual and particularly long duration,due to extensions and novations thereof, they become indefinite because their object loses its own autonomy and substance, and becomes over the years in normal and permanent activity of the contractor company. The cause that enabled the temporary contracting ceases to exist, and the fulfillment of the resolutory condition is postponed indefinitely.

Termination of the work contract linked to the duration of a contract

Completion of the work or service (ET art.49.1 .c)

Assumptions

Termination of the contract. It is unfair dismissal if:
- the contract is awarded again to the same contractor.
- early termination of the contract by agreement of the companies involved, or decision of the contractor.
- the contract has been made indefinite by:
  - exceed the maximum period of duration of the work or service contract (for contracts concluded from 18-6-2010).
  - be linked to a contract of unusual and particularly long duration (for contracts prior to 18-6-2010, when a maximum duration of this type of contract was not established).
- Reduction of the object of the contract if it is foreseen as a cause of completion of the work.
- Gradual completion of the contract.

procedure

Prior complaint from the employer.
Minimum notice of 15 days for contracts of more than 1 year.

indemnity

Depending on the date of conclusion of the contract:

until 31-12-2011: 8 days per year of service,
in 2012: 9 days per year of service,
in 2013: 10 days per year of service,
in 2014: 11 days per year of service,
as of 1-1-2015: 12 days per year of service.

Objective causes (ET art.52.c)

Assumptions

reduction of the volume of activity of the contract.
the application of this cause of termination cannot be avoided by means of a resolutory condition included in the employment contract (TS 14-11-17)

form

According to the number of contracts terminated:

objective dismissal
collective dismissal

indemnity

The compensation will be: 20 days per year of service.

For the contract: work or service

If your company is hired to perform a job for another company and you need to hire a worker to cover that contract, it is valid that you formalize a work or service contract.

This has been reiterated in a recent supreme court ruling:

A contract implies a temporary need for work. Therefore, you can sign a construction contract with the worker if its duration extends to that of the contract. note. In any case, this contract has a maximum duration of three years (four if permitted by the agreement). Therefore, if the contract exceeds that duration, the contract will become fixed.
The service is provided on behalf of a third company and for as long as the order lasts. Thus, the temporary nature of the employment contract is justified.