Spain considers 1,000 euro fine for probationary period dismissals

The Spanish Ministry of Labour is considering a new regulation that would impose a 1,000 euro fine on companies that dismiss employees during their probationary period. This measure aims to address a significant increase in contract terminations during this initial phase, which some experts argue has been used as a loophole for “free dismissal” without compensation.

Under current laws, the probationary period allows either party to terminate the relationship without cause or indemnity. However, reports suggest that dismissals during this window have increased by more than 400%, leading to concerns that companies are using it as a substitute for temporary contracts.

The proposed Royal Decree, which partially transposes a European directive, would require companies to specify the exact criteria used to evaluate employees during the trial period, such as punctuality or performance. If a company fails to justify a dismissal based on these pre-communicated parameters, the termination could be classified as unfair. While the measure aims to protect workers, particularly youth, some business owners express concern that it could discourage hiring, especially among small and medium-sized enterprises.