Spain: Number of open-ended contracts soars

The number of open-ended contracts in Spain has increased by more than 17% in the past year.

More than 270,000 open-ended contracts have been signed since they were introduced by law in 2012. The ‘open-ended contract for entrepreneurs’ (Contrato indefinido para emprendedores) is aimed at promoting stable employment, and it is expected to be available until the Spanish unemployment rate falls below 15%. It can be used by companies with fewer than 50 employees to hire full-time and part-time workers (in Spanish, 196 KB PDF). This type of contract offers financial incentives to hire workers younger than 30 or who are receiving unemployment benefits, and also gives social security discounts for hiring workers younger than 30 or older than 45. The main characteristic of this contract is that workers who are let go during their first year of service are not entitled to any type of severance pay. Other contracts in Spain generally set this probationary period at around 26 months.

A report published by recruitment agency Randstad in February 2015 reveals that, to date, more than 270,000 of these contracts have been signed (in Spanish, 276 KB PDF). Some 98,000 contracts were signed between February 2014 and February 2015, the greatest annual number signed so far and a 17% increase on the previous year.



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