- Seniority is calculated from the first contract, including probationary periods and subsequent temporary contracts.
- It directly impacts the calculation of severance pay and access to salary supplements such as triennial bonuses.
- There are specific situations, such as job changes or forced leave, that do not interrupt the counting of service time.
When discussing career paths, the term "seniority" frequently comes up, referring to the entire period during which a professional has provided services to the same organization. Understanding this concept is not merely a matter of curiosity, but something fundamental to ensuring that your rights are respected and that your remuneration is correct, especially if you wish to deepen your knowledge of labor law and employment legislation.
Often, people think that simply looking at the current contract date is enough, but the reality is that the calculation can be a real puzzle depending on the worker's career path. From successive contracts to leave management, there are details that can drastically alter the value of compensation or the granting of benefits.
What exactly is seniority in a company?
Simply put, seniority is the accumulated length of service between an employee and the company, counting from the signing of the first employment contract . It is an essential piece of information that must be included in the header of the payslip (nomina), as it serves as the basis for various legal and administrative benefits.
A crucial point is that seniority begins to be calculated from the first day, regardless of whether the contract was part-time, training, or temporary. However, it is important to note that curricular or extracurricular internships (scholarships) are not included in this calculation, as they do not formally constitute an employment relationship.
How to calculate length of service in detail.
For those who want to do the calculations at home, the process begins with identifying the start date of the contractual relationship . If there were several successive contracts with the same entity, all that time is added up, provided there was no significant break in the relationship.
In the case of those who worked through a Temporary Employment Agency (TEA) and were later hired directly by the client company, the period worked through the TEA should also be counted for seniority purposes. The probationary period, although a trial phase, is added to the total seniority once it is successfully completed.
To be more precise, we should follow these steps: first, locate the date of the first contract; second, check for any relevant interruptions; and third, add up the years, months, and days up to the current date. It's worth remembering that, for Social Security purposes, there is also a work history report , which records the worker's entire history across various companies, distinct from seniority at a single company.
Situations that do not interrupt the seniority count.
Many people fear losing their years of service due to internal changes, but the law protects the continuity of the employment relationship in several scenarios. For example, if the company changes its name, owners, or shareholders, the employee retains their original start date.
- Change of work location: Being transferred to another branch of the same company does not reset the counter.
- Surpluses: Mandatory leave or leave to care for children and family members does not interrupt seniority.
- Subrogation: When one company succeeds another, the rights and seniority of the workers are preserved.
However, it's important to note that voluntary overtime generally doesn't count towards the calculation of seniority bonuses, although it may not completely break the employment relationship depending on the case.
When is seniority lost?
The loss of seniority naturally occurs when the employment relationship ends, whether through voluntary resignation or dismissal . If the employee leaves the company and then returns under a new contract, the count usually starts from zero, unless there is a specific agreement.
A more complex point is the concatenation of temporary contracts. Case law tends to consider that there is continuity if the interval between one contract and another is less than one month . However, the courts have been flexible in some cases, even recognizing the unity of the employment relationship with interruptions of almost four months, depending on the analysis of the specific case.
The influence of seniority on the payroll.
Seniority isn't just for statistical purposes; it has a direct financial impact. The most common example is salary supplements , such as triennial (paid every 3 years) or quinquennial (every 5 years) bonuses. These bonuses aren't universal, but rather defined by the collective agreements of each sector.
If your collective agreement provides for an increase of, for example, 5% for each three-year period, and you have already been with the company for 6 years, you will receive a 10% increase on your base salary. If the agreement does not provide for this, the worker is not automatically entitled to this extra payment, as the Workers' Statute does not impose it as a general rule.
Importance in calculating compensation and other benefits.
Perhaps the most critical aspect of seniority is the moment of dismissal. In an unjustified dismissal , the calculation of compensation is based on years of service. In the Spanish system, for example, it is considered 33 days of salary per year, with maximum limits.
Besides the financial aspect, seniority can give priority in scheduling vacations , making life easier for those who have been with the company longer. It is also crucial for those who want to climb the corporate ladder, as many companies use years of service as a tiebreaker for internal promotions.
For temporary workers, the rule has recently changed. Now, seniority for the purposes of economic and professional promotion is based on the total duration of the employment relationship and not just the number of days actually worked. However, for the purposes of dismissal, case law may still focus only on periods of actual work.
Maintaining a precise record of the start date and all subsequent contracts is the best way to avoid errors in payroll or payroll processing. Seniority shapes an employee's financial security and defines their value within the organization, making it essential to verify that the date on the payslip accurately reflects the employment relationship established from day one.
