Three Supreme Court judgments redefine the consequences of abusive temporary employment and increase the risks for public authorities. The status of the indefinite non-permanent employee (indefinido no fijo) has for years been one of the main judicial responses to abusive temporary employment in Spain’s public sector.
The traditional approach was relatively well established: where a public administration maintained a temporary employee for an unjustifiably long period without permanently filling the position, the courts could recognise the employee as an indefinite non-permanent employee. The employment relationship would not become permanent, but neither could it continue to be treated as an ordinary temporary contract.
This framework has changed substantially in 2026.
The Judgment of the Court of Justice of the European Union of 14 April 2026, Case C-418/24, Obadal held that the measures traditionally used in Spain to address the abuse of successive temporary contracts in the public sector do not, in themselves, provide an effective, proportionate and dissuasive response. This includes the conversion into an indefinite non-permanent employment relationship.
The Spanish Supreme Court has therefore had to adapt its case law rapidly. The judgments issued during the following months show a new framework based on three main ideas: abusive temporary employment no longer automatically leads to indefinite non-permanent status; compensation for the abuse takes on a central role; and permanent status can only be recognised in certain circumstances compatible with the principles of equality, merit and ability.
A separate but related risk also arises in cases involving recurrent external collaborators who are formally engaged through commercial arrangements but may, in practice, qualify as employees.
Three Supreme Court judgments issued in July 2026 illustrate this changing landscape.
1. Supreme Court Judgment 670/2026 of 14 July: a vacancy-based temporary contract lasting more than three years no longer leads to indefinite non-permanent status
The first case concerned an employee who had been hired by the Government of Galicia under a vacancy-based temporary contract in September 2018 to work as a cleaner.
When she brought her claim in February 2022, she had been occupying the position for approximately three years and five months. Crucially, there was no evidence that the process to permanently fill the vacancy had actually been initiated.
The Labour Court had recognised her status as an indefinite non-permanent employee, but the High Court of Justice of Galicia overturned that decision, considering that the period exceeding three years was not sufficient to establish excessive duration and taking into account, among other circumstances, the COVID-19 pandemic.
The Supreme Court rejected that approach.
The pandemic does not, by itself, justify the delay
The Supreme Court recalled that the pandemic may be relevant where a recruitment or selection process was already genuinely underway and its suspension was directly caused by the exceptional circumstances arising from COVID-19.
However, the pandemic cannot be used as a general justification for any administrative delay.
In this case, the process to permanently fill the position had not been initiated. The Court therefore considered that the period of three years and five months amounted to abusive temporary employment and that the pandemic could not neutralise that delay.
For public authorities, this distinction is particularly important: it is not enough to demonstrate that an exceptional situation existed; it must be shown that the situation directly and genuinely affected a selection process that was already underway.
This approach is also connected with Article 70 of the Spanish Basic Statute of Public Employees, which establishes a maximum period of three years for implementing a public employment offer or equivalent instrument.
But the Supreme Court can no longer declare the employee indefinite non-permanent
This is where the major change lies.
Under the previous doctrine, these circumstances would generally have led to recognition of indefinite non-permanent status.
Following Obadal, however, the Supreme Court considers that this status is no longer an appropriate response to abusive temporary employment falling within Clause 5 of the Framework Agreement.
The Court therefore held that, although the circumstances would previously have justified recognition of indefinite non-permanent status, that classification can no longer be granted as the remedy for the abuse.
Instead, the Court declared that the employee had been subject to abusive temporary employment and recognised her right to claim the appropriate compensation in separate proceedings.
The judgment therefore does not leave the employee without a remedy. What changes is the nature of that remedy: the employment relationship is not automatically converted into indefinite non-permanent status; instead, the abuse gives rise to a specific right to compensation.
What does this mean for public authorities?
The practical consequences are significant.
A public authority that keeps a vacancy filled on a temporary basis for more than three years without genuinely initiating the process to permanently fill the position may now face a different type of risk: the employee will not necessarily become an indefinite non-permanent employee, but may be entitled to claim compensation for the abuse.
The Supreme Court also maintained the possibility of referring the matter to the Labour Inspectorate so that potential administrative liability can be assessed.
The dispute therefore does not disappear simply because indefinite non-permanent status is no longer the remedy. The type of risk that the public authority must manage changes.
2. Supreme Court Judgment 662/2026 of 9 July: obtaining a permanent position does not erase previous abusive temporary employment
The second judgment concerns a particularly relevant situation for public authorities carrying out workforce stabilisation processes.
The employee had worked as a nursing assistant for the Provincial Council of Burgos since 2008 and had previously obtained judicial recognition as an indefinite non-permanent employee.
In 2023, she passed a stabilisation process and obtained a permanent position. She was assigned to a different residence from the one where she had worked in recent years and claimed compensation equivalent to 20 days’ salary per year of service, arguing that her previous employment relationship had ended.
The Supreme Court rejected that claim.
Stabilisation does not terminate the employment relationship where continuity exists
The Supreme Court found that there had been no terminating novation.
Key elements of the employment relationship remained unchanged, including the employer, the occupational category and the continuity of the employment relationship. The change of workplace was not sufficient to establish that the previous employment relationship had been terminated.
Therefore, the compensation associated with termination of the employment relationship was not payable.
This part of the judgment is favourable to public authorities: obtaining permanent status through a stabilisation process does not automatically create an entitlement to termination compensation.
But the judgment does not end there.
Becoming permanent does not erase previous abusive temporary employment
The Supreme Court distinguishes between two different concepts.
The first is compensation linked to the termination of the employment relationship.
The second is compensation intended to remedy the abusive temporary employment suffered during the preceding years.
The latter may still exist even if the employee subsequently obtains permanent status. The Court considers that subsequent stabilisation does not eliminate the previous period of precarious employment or automatically erase the harm caused by the abuse.
An exception may arise where the conversion into permanent status was automatic, guaranteed, unconditional, without interruption and without an uncertain selection process. The existence of those circumstances must be established by the public employer.
Therefore, in ordinary stabilisation processes, obtaining permanent status does not necessarily eliminate the risk of a compensation claim relating to the previous period of abusive temporary employment.
Compensation for abuse and the LISOS reference
One of the most relevant developments in this case law concerns the way compensation may be quantified.
The Supreme Court considers that the scale of penalties established under the Spanish Law on Social Offences and Sanctions (LISOS) may be used as an indicative reference.
For serious offences under Article 7.2 of the LISOS, the applicable range since December 2021 is between €1,000 and €10,000, depending on the applicable degree. The Court considers that this scale may serve as a reference for determining a presumptive minimum compensation for abusive temporary employment, without preventing the recognition of higher damages where the employee proves greater harm.
This is important: it does not mean that every employee is automatically entitled to €10,000.
The scale operates as an indicative reference and the final amount must take into account the circumstances of the particular case. Where greater harm is established, compensation may exceed that reference.
For public authorities with large numbers of employees who have experienced prolonged periods of temporary employment, the potential aggregate financial impact may therefore be significant.
3. Supreme Court Judgment 617/2026 of 1 July: CIS survey interviewers are permanent intermittent employees
The third judgment concerns a different issue, but one that is particularly relevant to public authorities and companies that outsource services.
The case involved a survey interviewer who had worked with the Centre for Sociological Research (CIS) in Seville since 2003.
There was no written employment contract and the interviewer was paid for each validated survey. However, the CIS determined important aspects of the work, including work areas, questionnaires, deadlines, training, the number of surveys and, subsequently, shifts and schedules for telephone interviews.
In 2021, the CIS outsourced fieldwork to TRAGSATEC and the interviewer was no longer called upon to work. The High Court of Justice of Andalusia had classified the relationship as commercial.
The Supreme Court reached a different conclusion.
Dependence and employer ownership of the results prevail over the contractual form
The Supreme Court reiterated the doctrine it had already established in 2023 concerning this group of workers.
The existence of a formal commercial relationship does not prevent the relationship from being classified as employment where the characteristics of dependence and employee status are present.
In this case, the CIS provided instructions concerning essential aspects of the work, reviewed the surveys before payment was made, unilaterally determined remuneration and assumed the result of the activity.
These elements led the Court to conclude that an employment relationship existed.
The Court also considered the relationship to be permanent intermittent employment (fijo discontinuo), as the activity was intermittent, was not performed throughout the entire year and the dates on which services would be provided were not predetermined.
The ability to reject assignments or work for other companies does not eliminate employment status
One of the most interesting aspects of the judgment is that the Court did not consider it decisive that the interviewer could reject particular studies or that she carried out activities for other companies.
Multiple activities and a degree of freedom to accept individual assignments do not necessarily eliminate dependence where the client controls the essential aspects of the service.
The judgment therefore provides an important warning for organisations using recurring networks of external collaborators.
Paying by results, allowing some freedom to accept assignments or allowing the professional to work for other clients does not guarantee that the relationship is commercial if, in practice, the organisation of the work has the characteristics of an employment relationship.
The Risk Extends Beyond the Public Sector
The three judgments address different situations but share a common principle: the legal form of a relationship cannot be assessed separately from the way in which the work is actually performed.
In cases of abusive temporary employment, a public authority cannot maintain a structural need indefinitely through temporary contracts while assuming that the only possible consequence will be recognition of indefinite non-permanent status.
In stabilisation cases, subsequently granting permanent status does not necessarily eliminate the financial consequences of previous abusive temporary employment.
And in commercial relationships, describing someone as a “collaborator”, paying them per survey or per result and allowing them to work for other clients does not prevent a court from finding an employment relationship where dependence and employee status exist.
For companies working with public authorities, there is an additional dimension: outsourcing an activity does not necessarily eliminate all employment risks arising from the way that activity was previously organised.
Supreme Court Judgment 617/2026 returned to the High Court of Justice of Andalusia the questions concerning whether there had been a dismissal or a transfer of the workforce to TRAGSATEC. That part of the dispute therefore remains unresolved.
What Should Public Authorities and Companies Review?
The new framework makes it particularly important to review long-term temporary employment relationships.
In the case of vacancy-based temporary contracts, public authorities should review how long each position has been temporarily occupied, whether the process to fill it permanently has genuinely begun and what circumstances, if any, may justify a duration exceeding the general limit.
The mere existence of a public employment offer should not automatically be confused with an actual recruitment process having been initiated where the relevant issue is establishing the circumstances surrounding the specific position.
It is also advisable to review the files of employees who have already obtained permanent status after prolonged periods of temporary employment. Obtaining a permanent position does not necessarily eliminate the risk of a compensation claim relating to the preceding period.
Finally, recurring commercial relationships should be reviewed from the perspective of actual employment status: who organises the work, who establishes the working conditions, who supervises the service, who assumes the economic risk and who benefits from the activity.
A New Stage for Temporary Employment in the Public Sector
The Obadal judgment has not eliminated the problem of abusive temporary employment in the public sector. It has forced the legal response to that abuse to change.
Indefinite non-permanent status is no longer, in the cases falling within Clause 5 of the Framework Agreement, the appropriate judicial response to abusive temporary employment. The alternative is to assess on a case-by-case basis whether permanent status can be recognised which cannot be done automatically and, where it cannot, to ensure effective and dissuasive financial compensation.
The Supreme Court judgments issued in July 2026 show how this new framework is beginning to take shape.
For public authorities, the message is clear: maintaining a structural need for years through temporary employment can generate a cost that is no longer limited to the eventual termination of the employment relationship.
For companies working with the public sector, Judgment 617/2026 adds another warning: commercial relationships must be structured and performed according to their true nature because the contractual label does not prevail over the reality of the work performed.
At Suárez de Vivero, we advise national and international companies on employment litigation in Spain, including disputes concerning employment contracts, dismissals, employment classification and claims arising from contractual arrangements that may create employment liabilities.
We also advise companies on employment due diligence in Spain to identify risks relating to temporary employment, recruitment and relationships with external collaborators before a transaction or restructuring.
Frequently Asked Questions About Indefinite Non-Permanent Employment and Abusive Temporary Employment
Has indefinite non-permanent employee status been abolished?
It would be inaccurate to say that the status has disappeared in every context. The new doctrine establishes that indefinite non-permanent status is no longer an appropriate remedy for abusive temporary employment falling within Clause 5 of the Framework Agreement, following the Obadal judgment.
What happens when a public authority abuses temporary employment?
The answer depends on the circumstances. The employee may have a right to specific compensation for the abuse and, in certain cases, permanent status may be recognised where the employee has already passed a selection process for permanent employment. Permanent status is not automatically granted to every employee affected by abusive temporary employment.
Is compensation for abusive temporary employment always €10,000?
No. The Supreme Court has considered that the LISOS penalty scale may be used as an indicative reference for determining presumptive minimum compensation. For serious offences under Article 7.2 of the LISOS, the applicable range since December 2021 is between €1,000 and €10,000. The employee may establish greater harm.
If a temporary employee obtains a permanent position, do they lose the right to claim compensation for previous abuse?
Not necessarily. Supreme Court Judgment 662/2026 confirms that subsequently obtaining permanent status does not automatically erase the previous period of abusive temporary employment. The public authority may still face a compensation claim relating to that period, unless the specific circumstances allow the permanent appointment itself to be considered a sufficient remedy.
Can the COVID-19 pandemic justify a vacancy-based temporary contract lasting more than three years?
It may be relevant in certain circumstances. The case law requires an assessment of whether the process to fill the position was genuinely underway and whether its delay was directly caused by the pandemic. Merely invoking COVID-19 is not sufficient.
Can a person working as a self-employed professional or external collaborator be classified as an employee?
Yes, where the actual relationship contains the characteristics of employment, particularly dependence and the employer’s ownership of the results of the work. The contractual form or the ability to work for other clients is not, by itself, decisive.
Are CIS survey interviewers employees?
Supreme Court Judgment 617/2026 confirmed that, in the case analysed, the relationship was an employment relationship and that the employees had permanent intermittent status. The Court considered it decisive that the CIS organised and controlled essential aspects of the work, determined remuneration and assumed the results of the activity.
Can a company continue using recurring external collaborators?
It can do so where the relationship is genuinely commercial and the professional has sufficient autonomy. However, if the company or client substantially organises, directs and controls the work, there is a risk that the relationship will be reclassified as employment.
