Labour
Redundancies & Settlements
Expert guidance through dismissals, redundancies, and settlement agreements — protecting your business while treating employees fairly.
What is it?
Ending an employment relationship is one of the most legally sensitive moments in a business's life. Spanish labour law establishes strict rules depending on the reason for dismissal — disciplinary, objective, or collective — and each route carries different procedural requirements, notice periods, and compensation entitlements. A procedural error, even in an otherwise justified dismissal, can result in a court declaring the dismissal unfair (improcedente), which significantly increases the cost.
Settlement agreements (finiquitos) must be calculated with care, covering all outstanding salary, accrued but untaken holiday, proportional bonuses, and any agreed severance. Errors in the settlement — whether understating or overstating amounts — create legal exposure that can surface months later in employment tribunal proceedings.
GCT1 advises employers throughout the entire dismissal process, from the initial decision through to the signed settlement. We calculate the correct compensation, prepare the required documentation, manage any pre-dismissal consultation obligations, and represent your interests if the matter proceeds to mediation or tribunal.
Who is it for?
- Employers considering a disciplinary dismissal who need to assess risk and follow the correct procedure
- Businesses facing economic, technical, organisational, or production difficulties that may justify objective redundancies
- Companies needing to carry out a collective redundancy procedure (ERE) affecting multiple employees
- Managers and HR professionals who need an independent calculation of settlement figures before signing
- Business owners who have received a wrongful dismissal claim (demanda por despido) and need urgent advice
What's included in our service
- Legal assessment of the grounds for dismissal and the most appropriate procedure to follow
- Calculation of all settlement amounts including severance, outstanding salary, proportional bonuses, and accrued holiday
- Preparation of the dismissal letter (carta de despido) with legally required content and wording
- Management of the mandatory pre-dismissal consultation period where applicable
- Preparation and signing of the settlement agreement (finiquito) and, where agreed, the conciliation agreement (acuerdo de conciliación)
- Advice on FOGASA (Wage Guarantee Fund) claims where the employer is insolvent or in insolvency proceedings
- Representation at the mandatory prior conciliation hearing before employment tribunal proceedings
Documentation you will need to provide
- Employee's full employment history: contract, seniority date, category, and salary
- Applicable collective agreement and current salary tables
- Payslips for at least the last 12 months to verify all salary components
- In disciplinary cases: evidence supporting the alleged misconduct
- In objective cases: economic, financial, or organisational documentation justifying the measure
- Record of any previous warnings, agreements, or disciplinary actions involving the employee
Key deadlines
- A disciplinary dismissal letter must be delivered to the employee personally and in writing; the 20-day working day period to challenge the dismissal begins from the date of receipt
- Objective dismissal requires 15 calendar days' notice (or payment in lieu) and simultaneous delivery of the severance pay
- Collective redundancy procedures (EREs) require a minimum 15-day consultation period with employee representatives (30 days for companies with 50 or more employees)
- Any claim for wrongful dismissal must be filed at the employment tribunal within 20 working days of the dismissal date
Why GCT1
- We assess both the legal and economic risk of each dismissal route before you make any commitment, helping you choose the approach that protects the business
- Our settlement calculations are thorough and documented, giving you confidence that the figures are correct and defensible if challenged
- We have handled hundreds of redundancy and dismissal cases across diverse sectors in the Alicante region, including complex collective procedures
- Free first consultation to review the situation and outline your options without any obligation
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