Questions and answers on permanent contracts in the Science, Technology and Innovation Law

INTRODUCTION

  • Article 23 bis of the Science Act reform, already in force as it was approved in advance by Royal Decree-Act 8/2022 of 5 April, ratified in the Congress of Deputies without any vote against, enables the permanent employment of research personnel (scientific, technical and management)

    in public sector bodies, both when they have their own funds and in the case of external funds, whether public or private, and of domestic or foreign origin.

  • Additional Provision 10, which was included in the parliamentary procedure for the draft law, adjusts Royal Decree-Act 32/2021 of 28 December (on labour reform), so that in the case of competitive European funding, the employment of research personnel in public bodies is carried out through permanent contracts, with the possibility of using the contracts regulated in Article 23 bis, without being able to enter into fixed-term contracts in this case.
  • With the Additional Provision 10, the scope of application of Article 23 bis of the Act reform is expanded, which will allow more research personnel to work under better working conditions.

FAQs AND ANSWERS

What are the advantages of permanent contracts in the public sector for science, technology and innovation with respect to the previous temporary employment model?

Permanent contracts regulated under Article 23 bis have numerous advantages over temporary employment:

  • More stability: they allow the position to be maintained if new external funding is achieved through an addendum to the initial contract, so the member of staff does not have to reapply in new selection processes.
  • More labour rights: compensation of 20 days per year worked instead of 12 days when under temporary employment, and better conditions for seniority, mortgage applications etc.
  • Avoid potential fraud in temporary employment contracts through the inappropriate chaining of these contracts, since Additional Provision 23 of the Science Act of 2011, which has been repealed by this draft law, enabled the chaining of temporary employment contracts, was inapplicable on numerous occasions in the legal field as it entailed a reduction in guarantees for workers employed in the SECTI in relation to other workers covered by the Statute of Workers' Rights (a regulation that did not provide for such chaining and which is the minimum that ensures workers' labour rights).
  • Increased agility: they are not subject to limitations on public job offers, the wage bill or the public sector retirement/recruitment rate, and do not require prior authorisation if carried out with competitive funding, such as European funds.

Will there be labour disputes due to possible difficulties in terminating the contract when no other funds are available to keep the person employed?

This contract can be terminated as it is subject to Article 52 (e) of the Statute of Workers' Rights (ET), which allows non-profit organisations to consider as objective grounds for contract termination the insufficient allocation of funds. Therefore, centres that do not have new funding available to support employees may terminate the contracts without further hindrance.

It should be remembered that research centres such as the CSIC are already recruiting all their personnel with research funds using permanent employment contracts, and have obtained the approval of State Lawyers for a standard contract template that includes this contract termination clause.

How much is the increase in compensation costs resulting from the change from temporary contracts to permanent contracts?

The increase in compensation from 12 to 20 days represents an increase in the labour cost of just 2.1% per year, the equivalent of 8 days of compensation extra per year.It should be taken into account that the previous service and works contracts system paid for 12 days of compensation. However, this cost increase is considerably reduced since permanent contracts are taxed with a 1.25% lower employer's social security contribution than the temporary service and works contracts.

Taking into account that a standard contract in a European project for a researcher stands at around €40,000 gross per year and lasts for three years, the increase in compensation would entail an additional cost of around €2,600 per person (€876 more per year), without taking into consideration savings in social security costs.

Could this change affect the training and consolidation of young researchers who are in a period of high mobility and temporary stays?

Research personnel who are in the training period (pre-doctoral) and early stages of consolidation (post-doctoral) are not affected by this reform as they may continue to be employed with European funds through the temporary contracts stipulated in the Science Act, which have durations of: up to 4 years for predoctoral contracts aimed at presenting a doctoral thesis (Article 21), and between 3 and 6 years for post-doctoral contracts for accessing the system (Article 22). Therefore, the use of this type of employment contract is not detrimental to young researchers working for specific periods of time in research centres as part of their training and consolidation phase.

How can compensation be paid when the person is still employed with new funding?

Compensation is eligible expenditure for European and national projects if it occurs at the end of the same, and provisions can also be made by allocating this expense to indirect costs (up to 25%) that are covered by European and national projects.

Is competitive European research funding put at risk with this change in the type of employment?

Under no circumstances will European funding be threatened. On the contrary, the Science Act facilitates the recruitment of researchers with external funds of any kind, including European funds. The aim of Article 23 bis of the LCTI is to streamline the recruitment process, disassociating it from the need for authorisation and other procedures, when the research group or centre has external funds, including European funds.

Will this type of recruitment generate fake permanent contracts with a possible increase in labour disputes?

This is an erroneous argument, since a permanent contract is not a fixed-term contract, but its duration is not determined in advance. Research personnel with a permanent contract are under no circumstances considered permanent members of staff and are, therefore, subject to dismissal for objective grounds as regulated in Article 52 (e) of the ET, in addition to the other legal grounds for termination of the employment relationship.

Will there be more labour disputes if some centres have to deal with numerous redundancies of EU-funded staff with the consequent redundancy procedures (ERE)?

It should be clarified that ERE redundancy procedures are an administrative procedure through which a company in crisis seeks to obtain administrative authorisation to suspend or dismiss 10% of their workforce in 90 days, for companies of between 100 and 300 workers, or for 30 or more days in companies of more than 300 workers. This procedure requires the company to open a consultation period in writing to the workers' legal representatives.

It is considered that possible ERE redundancies due to the termination within 3 months of more than 10% of the workforce or 30 people recruited through European projects would occur very rarely, only when there is a concentration of project terminations. In any case, these hypothetical ERE redundancies would be approved by the administrative authority as they would be fully justified due to the end of European funding. It should be remembered that permanent contracts may include a clause that links their continuity to the funding of a specific research project or line, pursuant to Article 52 (e) of the ET.

Similarly, it should be noted that the ERE redundancy procedures were also applicable to fixed-term contracts, including service and works contracts, since Article 51 of the ET makes no distinction as to the duration of the contracts covered by the ERE, speaking in general of "termination of employment contracts", which they are, when the objective grounds for termination and the thresholds established in said Article 51 are met. Hence, the change to permanent contracts as a general system of recruitment does not alter the applicability or not of ERE redundancies, which will remain identical to when research personnel were employed through temporary contracts.

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