In Spain, not all dismissals are the same and they do not have the same financial consequences for workers. Whether you are entitled to compensation — or any compensation at all — depends on the type of dismissal. This guide explains each case clearly.
The three types of dismissal
1. Fair dismissal
A dismissal is fair when the employer proves there is a legitimate reason to terminate your contract. The causes are listed in the Workers' Statute:
Disciplinary grounds (article 54 ET):
- Repeated and unjustified absences or lateness
- Indiscipline or disobedience at work
- Verbal or physical offenses against the employer, colleagues, or family members
- Breach of good faith or abuse of trust
- Continued and voluntary poor performance
- Intoxication or drug addiction that affects work
- Harassment based on race, ethnicity, religion or other protected attributes
What compensation applies for fair dismissal?
None. If disciplinary dismissal is declared fair, the worker is not entitled to compensation. They only receive the settlement payment (days worked + vacation + proportional extra pay).
2. Unfair dismissal
A dismissal is unfair when the employer fails to prove the reason given or when formal requirements are not met (for example, a flawed dismissal letter).
In this case, the employer can choose between:
a) Reinstating the worker and paying back pay from dismissal to the court ruling
b) Compensating the worker:
- 33 days' salary per year worked, capped at 24 months
- For years before February 12, 2012: 45 days/year, capped at 42 months
The 42-month cap applies only to years prior to 12/02/2012. Later years are calculated at 33 days and capped at 24 months. The final amount is the sum of both calculations.
If the worker is a union representative, they choose between reinstatement or compensation.
3. Null dismissal
A dismissal is null when it violates fundamental worker rights or occurs in especially protected circumstances:
- During pregnancy
- While on maternity, paternity, adoption or foster leave
- When discrimination occurs due to gender, race, religion, sexual orientation, disability or other grounds
- When exercising reconciliation rights (reduced hours, leave for child or family care)
- After notifying the employer of pregnancy
What happens if the dismissal is null?
The employer is required to reinstate the worker (they cannot choose compensation instead) and must pay back pay from the dismissal date until effective reinstatement.
Objective dismissal: between fair and unfair
There is an intermediate type called objective dismissal (article 52 ET). It is based on economic, technical, organizational, or production reasons that justify letting the worker go, but it is not the worker's fault.
Compensation for objective dismissal: 20 days per year worked, capped at 12 months.
To be valid, the company must:
- Notify the worker 15 days in advance (or pay those days as compensation)
- Provide a dismissal letter with a justified cause
- Offer the compensation at the time of dismissal
If these requirements are not met or the cause is not proven, the objective dismissal becomes unfair.
Summary table of compensation
| Dismissal type | Compensation | Cap |
|---|---|---|
| Fair disciplinary | 0 days/year | — |
| Fair objective | 20 days/year | 12 months |
| Unfair (post 12/02/2012) | 33 days/year | 24 months |
| Unfair (pre 12/02/2012) | 45 days/year | 42 months |
| Null | Mandatory reinstatement | — |
Can I challenge the dismissal?
Yes. If you believe your dismissal is unfair or null, you have 20 working days from the dismissal notice to challenge it. The process is:
- Conciliation claim: before going to court, you must file a conciliation claim with the SMAC (Mediation, Arbitration and Conciliation Service) in your region. This process is mandatory and free.
- Labor court hearing: if there is no agreement, the social court holds a trial.
Important: the 20 working-day deadline does not stop while waiting for conciliation, but it is suspended during the days from filing the claim until the conciliation hearing.
What about unemployment benefits?
Regardless of the type of dismissal, you can apply for unemployment benefits if you have contributed at least 360 days in the last 6 years. Compensation for dismissal does not reduce unemployment benefits: they are separate concepts.
Calculate your settlement and compensation
Knowing the dismissal type is the first step. The second is calculating exactly how much you should receive. Use our settlement calculator to get a complete breakdown: compensation, days worked, vacation and proportional extra pay.