The permanent flat-rate contract versus the psychological contract
Posted: Wed Dec 18, 2024 4:27 am
The introduction of the flat rate to Social Security for the permanent hiring of new workers , through Royal Decree-Law 3/2014 , may have some initially unexpected effects, as it represents a saving on temporary hiring , when this exceeds one year.
In these cases, some employers may consider it more beneficial to disguise temporary contracts under the figure of a subsidized indefinite contract, for the purposes of cost savings , although in no case should the implications that this fact has on the " psychological contract " be ignored.
Three fundamental requirements
We must remember that the measure has been approved based on three basic requirements: it cannot be applied if an unfair or collective dismissal has occurred after February 24, 2014, in which case they must wait 6 months to be able to hire permanent employees with a subsidized contract.
The obligation to return the bonuses applied has also been established if the requirement of maintaining employment in the organization is not met. Finally, the measure will only be in force until December 31, 2014.
In the first requirement we already find a problem in applying these contracts when "replacing" temporary contracts, since if a dismissal were to occur for this purpose, it would probably be done improperly, unless there are other causes or it occurs during the trial period, which will not exceed one year applicable to indefinite contracts to support entrepreneurs.
This would mean that no other subsidised hiring could be telecommunications email list made during the following six months, thereby preventing the replacement effect at least immediately, although not other types of strategies.
For example, companies that are already using temporary contracts as a way to avoid paying high severance pay in the event of dismissal, might find the idea of ​​converting them to permanent contracts to benefit from the bonus in common contingencies attractive, since from the start of the second year of the contract, it would be cheaper to end the employment relationship by paying the severance pay, even returning the percentage of the contributions that correspond to failure to comply with the requirement of maintaining employment.
Breach of the psychological contract
The economic savings that would result from carrying out this legal trick, result in a non-monetary cost , which is reflected in the breach of the so-called psychological contract, which could have effects on the work environment.
This "ethereal" contract represents the expectations of employees regarding the employment relationship established with the company and has important roots in the contractual figure that unites them, as well as in the communication that has been produced with the organization.
In these cases, some employers may consider it more beneficial to disguise temporary contracts under the figure of a subsidized indefinite contract, for the purposes of cost savings , although in no case should the implications that this fact has on the " psychological contract " be ignored.
Three fundamental requirements
We must remember that the measure has been approved based on three basic requirements: it cannot be applied if an unfair or collective dismissal has occurred after February 24, 2014, in which case they must wait 6 months to be able to hire permanent employees with a subsidized contract.
The obligation to return the bonuses applied has also been established if the requirement of maintaining employment in the organization is not met. Finally, the measure will only be in force until December 31, 2014.
In the first requirement we already find a problem in applying these contracts when "replacing" temporary contracts, since if a dismissal were to occur for this purpose, it would probably be done improperly, unless there are other causes or it occurs during the trial period, which will not exceed one year applicable to indefinite contracts to support entrepreneurs.
This would mean that no other subsidised hiring could be telecommunications email list made during the following six months, thereby preventing the replacement effect at least immediately, although not other types of strategies.
For example, companies that are already using temporary contracts as a way to avoid paying high severance pay in the event of dismissal, might find the idea of ​​converting them to permanent contracts to benefit from the bonus in common contingencies attractive, since from the start of the second year of the contract, it would be cheaper to end the employment relationship by paying the severance pay, even returning the percentage of the contributions that correspond to failure to comply with the requirement of maintaining employment.
Breach of the psychological contract
The economic savings that would result from carrying out this legal trick, result in a non-monetary cost , which is reflected in the breach of the so-called psychological contract, which could have effects on the work environment.
This "ethereal" contract represents the expectations of employees regarding the employment relationship established with the company and has important roots in the contractual figure that unites them, as well as in the communication that has been produced with the organization.