Key labour law reforms: permanent disability and equality plans
Two major changes in Spanish labour law entered into force in 2025: a new procedure for contract termination due to permanent disability, and stricter rules for equality plans in companies. Here’s the updated legal overview:
Contract termination due to permanent disability
Since May 1st, 2025, Law 2/2025 has eliminated the automatic termination of employment after a worker is declared permanently disabled. Instead, the law now requires:
Worker’s decision: After an official ruling confirms the disability, the employee has 10 calendar days to inform the company whether they wish to continue working or end the contract.
Reasonable adjustments: If the worker opts to stay, the employer must make necessary workplace adaptations or relocate the worker to a suitable role within three months.
Termination only if justified: If adaptation or relocation is unfeasible or causes disproportionate hardship, the employer may lawfully terminate the contract—without severance but with proper justification.
Stronger protection: This legal shift reflects EU Court of Justice doctrine (Case C-631/22) and the UN Convention on the Rights of Persons with Disabilities, promoting inclusion and job retention.
The new procedure imposes an obligation to evaluate individual situations, prioritising flexibility and anti-discrimination.
Equality plans and trade union involvement
In 2025, companies with over 50 employees are still required to develop and implement equality plans, with new legal emphasis on trade union participation and enforcement:
Effective union involvement: Trade unions must be actively involved in the negotiation, design and follow-up of equality plans.
Detailed pay audits: Employers must carry out comprehensive wage audits and adopt corrective measures to close gender gaps.
Anti-discrimination measures: Equality plans must include concrete actions to prevent discrimination, harassment, and support work-life balance.
Enforcement and penalties: Labour authorities are intensifying inspections. Non-compliance may lead to serious penalties, particularly when union rights are affected