{"id":35230,"date":"2026-08-25T13:51:45","date_gmt":"2026-08-25T11:51:45","guid":{"rendered":"https:\/\/addwill.eu\/?p=35230"},"modified":"2026-08-25T13:51:45","modified_gmt":"2026-08-25T11:51:45","slug":"amounts-paid-in-lieu-of-notice-for-objective-dismissal-must-now-be-subject-to-social-security-contributions","status":"publish","type":"post","link":"https:\/\/addwill.eu\/en\/amounts-paid-in-lieu-of-notice-for-objective-dismissal-must-now-be-subject-to-social-security-contributions\/","title":{"rendered":"Amounts paid in lieu of notice for objective dismissal must now be subject to Social Security contributions"},"content":{"rendered":"

 <\/p>\n

The General Treasury of Social Security changes its criteria on contributions for payments in lieu of notice in objective dismissals<\/strong><\/p>\n

On 14 July 2026, the Social Security’s Bolet\u00edn de Noticias RED 08\/2026 (RED News Bulletin) published a change to the criteria previously applied regarding the exemption from social security contributions \u2014 based on their compensatory nature \u2014 for payments made in lieu of notice in cases of termination of employment for objective reasons, as governed by Article 52 of the Workers’ Statute (Estatuto de los Trabajadores, “ET”).<\/p>\n

The General Sub-Directorate for Regulation and Appeals (Subdirecci\u00f3n General de Ordenaci\u00f3n e Impugnaciones<\/em>) of the General Treasury of the Social Security has determined that a review of the previous criteria was necessary, ruling that payments made in lieu of notice in this type of termination must now be subject to social security contributions.<\/p>\n

Grounds for the New Criteria<\/strong><\/p>\n

The new criteria are presented as an application of existing case law on the matter \u2014 although the bulletin does not identify the specific rulings on which it relies \u2014 and rest on two premises:<\/p>\n

    \n
  1. Article 53.1 ET, which governs the form and effects of contract termination for objective reasons, draws a distinction in its first paragraph between: (b) the requirement to make available to the employee, simultaneously with written notice, statutory severance pay of twenty (20) days’ salary per year of service; and (c) the granting of a notice period of thirty (30) days \u2014 now fifteen (15) days, under Article 53.1(c).<\/li>\n
  2. “Severance pay” and “notice pay” are distinct and independent concepts. Although there is no express definition of the legal nature of notice pay, it is understood to be closer in nature to salary. This conclusion is grounded in Article 123.2 of the former Labor Procedure Act \u2014 now Article 123.2 of Law 36\/2011 of 10 October, governing labor jurisdiction, which retains identical wording \u2014 which provides that, if a termination ruling is overturned, the employee must repay the severance amount received, but not the amount received for the notice period.<\/li>\n<\/ol>\n

    RED System<\/strong><\/p>\n

    Consequently, all amounts paid to an employee for lack of notice in an objective dismissal must now be reported for contribution purposes through the corresponding supplementary settlements, using the termination date as the accrual date. In practical terms, within the RED System these amounts must be reported under the contribution base for concept “CRA 0054,” now relabeled “SEVERANCE\/AMOUNTS FOR LACK OF NOTICE” (INDEM. DESPIDO\/CANTIDADES FALTA PREAVISO<\/em>). This change has already been incorporated into the Manual of Remuneration Concepts and Table T-84 of remuneration concept codes.<\/p>\n

    Subsequent Correction: The Notice Period<\/strong><\/p>\n

    On 16 July 2026, Bolet\u00edn de Noticias RED<\/em> 09\/2026 was published, correcting a reference in Bulletin 08\/2026 to “a notice period of 30 days”: this period does not reflect current legislation, which sets the notice period at 15 days under Article 53.1(c) ET. The error arose because the ruling cited in Bulletin 08\/2026 applied legislation that is no longer in force.<\/p>\n

    Conclusion<\/strong><\/p>\n

    The General Sub-Directorate for Regulation and Appeals has changed its position: going forward, amounts paid in lieu of notice in contract terminations for objective reasons must be subject to social security contributions. The new criteria are justified by reference to existing case law, although the bulletin does not cite the specific rulings relied upon, beyond an isolated reference to a ruling whose source is not identified. The RED System already allows these amounts to be reported under the new criteria.<\/p>\n

    For further information or advice, please contact our labor law department. You can call +34 93 487 52 00, email comunicacio@addwill.eu<\/a>, or click here<\/em><\/a>.<\/p>\n

    Author:<\/p>\n

    Lidia Sanlorenzo<\/strong><\/p>\n

    Associate, Employment Law Department<\/p>\n","protected":false},"excerpt":{"rendered":"

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