This paper investigates the quantitative effects of firing costs on permanent contracts and promotions for fixed-term contracts. Once firing costs are introduced, the employment share of permanent contracts falls, whereas the employment share of fixed-term contracts rises. Firing costs lead firms with vacancies to search for workers under fixed-term contracts than under permanent contracts. Therefore, the worker’s probability of finding a permanent job decreases, but the probability of finding a fixed-term job increases. In addition to firing costs, the effect of a permanent increase in the probability with which temporary workers are promoted to permanent positions is assessed. Quantitative exercises give the similar results to the increased promotion probability.