How Labor Legislation Impacts HR Management

Extensive regulations, complex issues, and ongoing changes that companies must adapt to. Labor legislation is a key area for professionals working in Human Resources, as well as for employers and employees. Here, we explain how these regulations affect the management and administration of personnel within a company.

Having labor legislation that establishes employees’ rights as well as their obligations is one of society’s major achievements. It provides a regulatory framework governing relationships between employers and employees and, in countries such as Spain, has been developing for almost a century and a half. It was on July 24, 1873, that the first law specifically created for this purpose was passed, known as the Benot Law.

Much has changed since then, including society, the economy and businesses themselves. A discipline as widely recognized today as Human Resources was virtually nonexistent decades ago. It has evolved progressively and, today, cannot be understood without recognizing the relationship between labor legislation and the professionals responsible for managing employees within a company.

What is labor legislation?

Defining what labor legislation is can be complex because of the wide range of issues it covers. However, its importance can be summarized through several fundamental aspects that any regulation governing relationships between professionals and organizations should address:

• Working conditions:

1. Remuneration
2. Type of working day
3. Working hours
4. Contract duration…

• Employees’ rights on the one hand, and employers’ rights on the other
• Employees’ and employers’ obligations
• Collective bargaining agreements and their respective conditions depending on the profession and sector

These are some of the essential aspects, as mentioned above, but there is much more to explore. Recruitment professionals working in administration and Human Resources departments need to understand these matters in detail. For this reason, specialized programs such as EAE Business School Barcelona's Master in Human Resources cover labor legislation in depth.

What is labor legislation like in Spain?

Employment regulations in Spain were reformed in 2021 and ratified in 2022. In other words, as mentioned above, this is a legal framework that evolves and adapts to changing times and emerging needs. Spanish labor legislation includes important regulations such as the Workers' Statute, the Social Security Act and the Employment Act, among others.

What are the main sources of these regulations? First and foremost, the Spanish Constitution, as well as European Union and national law, collective bargaining agreements and international treaties.

Labor legislation in Spain is characterized by the following aspects:

• Protection of employees.
• Basic rules governing issues such as occupational safety, health and employee wellbeing.
• A framework for ensuring that rights and obligations are respected within a country's productive sector.
• Obligations for employees.

The regulatory framework is extensive, so in order to understand labor legislation in Spain, it is important to know which laws specifically apply to Human Resources and team management.

• Workers' Statute

This is the foundation of the system. The Workers' Statute covers everything related to the relationship between professionals and companies. The Constitution establishes that the provisions contained in it must always be complied with in accordance with Royal Legislative Decree 2/2015.

• Labor reforms

These are introduced to incorporate new concepts or modify existing ones. They usually affect contract duration, collective bargaining agreements and other aspects established in the Workers' Statute.

• Social protection and prevention of job insecurity legislation on working hours

This is one of the regulations that has had the greatest impact on Human Resources management in recent years and is established under Royal Decree-Law 8/2019. It covers employee time tracking, rest periods, holidays, night work, overtime and other aspects.

• Equal pay and pay transparency legislation

This regulation was introduced in response to the gender pay gap in Spain. Its aim is to regulate aspects relating to salaries and additional remuneration included in payroll according to the type of work performed, regardless of the employee's gender.

• Occupational Risk Prevention Act

This legislation has been in force for more than two decades and aims to safeguard employees' physical and psychological health in the workplace. Companies have a responsibility to protect the wellbeing and integrity of their employees. 

• Employment protection legislation

This includes the mechanism commonly known in Spain as an ERTE. It came into force in 2020 during the pandemic and sets out the changes resulting from employment regulation measures in very specific circumstances.

• Remote working legislation

Introduced during the Covid-19 pandemic, remote working has become a permanent feature of the employment landscape. The legislation regulates situations involving remote work, including working hours, additional costs and other aspects.

There are also other important legal provisions, including those relating to retirement, employment contracts and many other areas. Professionals working in recruitment, Human Resources and business administration must understand what labor legislation is, what employees' labor rights are and which aspects are essential for performing their roles effectively.

Employees' labor rights: the role of HR in protecting them 

Professionals working in Human Resources must understand the fundamental aspects closely linked to protecting employees' rights. This includes regulations affecting areas such as:

1. Compliance with working hours and the recognition and agreed remuneration of overtime.
2. Workplace safety policies.
3. Respect for holiday periods and sick leave.
4. Appropriate remuneration in accordance with collective bargaining agreements and employment contracts.

Human Resources managers within companies should ensure that both parties comply with their respective rights and obligations. A thorough and accurate understanding of labor regulations is essential for these professionals to perform their roles effectively and for employees to feel supported and respected.

Human Resources is becoming increasingly important in all kinds of organizations, from SMEs to large corporations. It represents a significant area of employment, with highly qualified professionals increasingly in demand in labor markets such as Spain.