Subcontracting of Works and Services After the Labour Reform

We set out here the full text of Article 42 of the Workers' Statute, which governs the subcontracting of works and services. The labour reform introduces a single change to this provision: clarifying which collective bargaining agreement applies in a subcontracting arrangement.

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Written by Josep Conesa

Employment and insolvency lawyer

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Obligations when subcontracting

Article 42 of the Workers' Statute provides that companies which contract or subcontract with other businesses for the performance of works or services forming part of their own core activity must verify that those contractors are up to date with their Social Security contributions.

To this end, they must request in writing from the subcontractor a certificate confirming no outstanding Social Security debts, issued by the General Social Security Treasury.

The subcontractor must provide this certificate within a strict, non-extendable period of 30 days. Once this period has elapsed, the requesting company is released from any liability.

How long is the main company liable in a subcontracting arrangement?

The main company, subject to the expiry of the period referred to above in relation to Social Security, shall be jointly and severally liable for Social Security obligations incurred by contractors and subcontractors during the period the contract was in force, and this liability continues for three years following completion of the engagement.

In respect of salary obligations incurred by contractors and subcontractors towards their workers, the main company shall be jointly and severally liable for one year following completion of the engagement.

These liabilities do not arise when:

• an individual contracts or subcontracts the renovation of their own home,
• the owner of the works or business does not commission them in connection with a commercial activity.

Formal requirements in contracting and subcontracting:

The contracting or subcontracting company must inform:

1. Its employees in writing of the identity of the principal company, before work commences. This must include:
   • the name or registered company name of the principal company
   • its registered address
   • its tax identification number.
2. The General Social Security Treasury (TGSS) of the identity of the principal company.
3. The employees' legal representatives of the following particulars:
   • b) The subject matter and duration of the contract.
   • c) The location where the contract is to be performed.
   • d) The number of workers who will be employed under the contract or subcontract at the principal company's workplace.
   • e) The measures planned to coordinate activities from an occupational health and safety perspective.

The principal company must:

• make available a register recording the above information in respect of all companies referred to, where the principal, contracting, or subcontracting companies continuously share the same workplace.
• make available to employee representatives, in addition to the information under points 1 and 3, the name or registered company name, registered address, and tax identification number of the contracting or subcontracting company.
  
  

Which collective bargaining agreement applies to a subcontract

The collective bargaining agreement applicable to contracting and subcontracting companies shall be that of the sector corresponding to the activity carried out under the contract or subcontract, regardless of their corporate purpose or legal form, unless a different arrangement has been agreed through collective bargaining. 

However, where the contracting or subcontracting company has its own collective agreement, that agreement shall apply, on the terms arising from the Article 84 of the Workers' Statute concerning the coexistence of collective bargaining agreements.

Worker Representation in Contracting and Subcontracting Arrangements

Workers employed by contracting and subcontracting companies who do not have their own legal representation shall have the right to raise matters concerning their working conditions with the legal representatives of the workers of the main company, provided they share the same workplace and lack representation of their own.

The above paragraph shall not apply to claims brought by a worker against the company on which they directly depend.

The legal representatives of the workers of the main company and of the contracting and subcontracting companies, where they continuously share the same workplace, may meet for the purpose of mutual coordination and in relation to the conditions under which work is performed, in accordance with the terms set out in Article 81 of the Workers' Statute concerning premises and notice boards.

The representational capacity and scope of action of worker representatives, as well as their time-off credits for representative duties, shall be governed by applicable legislation and, where relevant, by any applicable collective bargaining agreements.

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