March 2010
LABOUR LAW
1. Charter of Fundamental Rights of the European Union
The Charter of Fundamental Rights of the European Union has been
approved and will replace the Charter signed on 7 December 2000 when the
Lisbon Treaty enters into force. (More information)
2. Transfer of functions and services to the goverment of
Catalonia on Inspector’s Public Function of the Labour and Social
Security Inspection
Royal Decree 206/2010 of 26 February transfers the duties and
services of the Labour and Social Security Inspectorate to the regional
government of Catalonia (Spanish Official Gazette of 1 March 2010).
(More information)
3. Collaboration between the Ministry of Labour and Immigration
and the Labour Department of the regional government of Catalonia
By means of a resolution dated 5 March 2010, the Technical
Secretariat published the collaboration agreement between the Ministry
of Labour and Immigration and the Labour Department of the regional
government of Catalonia on the organisation and operation of the Labour
and Social Security Inspectorate in Catalonia. (More information)
4. Electronic transfer to the Public Employment Service of
official earnings records
Order TIN/790/2010 of 24 March on the electronic transfer to the
Public Employment Service of official earnings records. (More
information)
5. Tax, labour and social security fraud prevention plan
This plan, approved by the Council of Ministers, has been prepared by
the Tax Authority, the Social Security General Treasury and the Labour
and Social Security Inspectorate in response to changes in the types of
fraud committed as a result of the current economic situation.
(More
information)
6. Labour courts jurisdiction. Deductions from back pay
The judgment of the Labour Chamber of the Supreme Court dated 24
November 2009 upheld an appeal for the unification of doctrine, and
reversed the judgment of the Labour Chamber of the High Court of Justice
of Catalonia dated 6 May 2008. The Supreme Court held that, in those
cases in which the withholding of tax and social security amounts is an
ancillary procedural issue, the labour courts are competent to decide
whether or not tax withholdings are applicable. (More information)
7. Saturdays falling between the submission of a conciliation
request and the conciliation hearing are not taken into consideration
for the calculation of a dismissal action statute of limitations period
The judgment of the Labour Chamber of the Supreme Court dated 21
December 2009 unified doctrine by overturning the decision of a lower
court that had held that Saturdays should be included in calculating the
15-day period for which the statute of limitations period of a dismissal
action is tolled after a conciliation request is made. (More
information)
8. Termination of an employment contract after a request to have
employment status changed to permanent or indefinite is not a breach of
the guarantee of indemnity
In its judgment dated 22 December 2009, the Labour Chamber of the
Supreme Court declared that the filing of a request by employees of a
public authority seeking that they be granted permanent status three
weeks before the expiry of their employment contracts is not sufficient
evidence to find that the fundamental rights of the employees have been
violated. (More information)
9. In the absence of an express CPI forecast in the State Budget
Law, the forecast for public pensions contained in the State Budget Law
applies for the salaries review provided in a collective bargaining
agreement that referred to the CPI forecast
This decision of the Labour Chamber of the Supreme Court, dated 18
February 2010, confirmed the National Court’s ruling. The Supreme Court
held that, since the State Budget Law does not contain an official RPI
forecast, the forecast provided for public pensions can be applied to
salary reviews. (More information)
10. If the CPI forecast exceeds the official CPI, a company can
deduct the difference in salary in subsequent payslips
In its ruling of 26 January 2010, the Labour Chamber of the National
Court held that a company was entitled to deduct from future payslips
the difference between a salary increase calculated on the basis of the
CPI forecast and the amount employees were actually entitled to
according to the official CPI. (More information)
11. Individual and collective dismissals. Insolvency
The ruling of the High Court of Justice of Castille and León, dated
17 December 2009, upheld a first instance decision that considered that
the judge in charge of insolvency proceedings was competent to hear the
dismissal claims that were brought by eight workers subsequent to the
employer’s insolvency declaration. (More information)
12. Non-professional use of the Internet during working hours.
Lack of adequate technical and security measures
By means of notary’s reports, it was proven that a work computer
lacked the adequate levels of security to establish that the prohibition
to use the Internet for personal use during working hours had been
breached. The dismissal was therefore declared to be unfair.
(More
information)
Portuguese Labour Law Newsletter.
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Newsletter [Portuguese]
1. Charter of Fundamental Rights of the European Union
Charter of Fundamental Rights of the European Union (2010/C 83/02)
of the European Parliament, the Council and the Commission (Official
Journal of the European Communities of 30 March 2010)
The Charter of Fundamental Rights of the European Union recognises a
number of rights, freedoms and principles deriving from the
constitutional traditions of the Member States, European traditions and
case law. The Charter contains several provisions that have a direct
impact on labour and social security matters, such as the prohibition of
slavery and forced labour, the freedom to choose an occupation, the
right to work and the freedom to conduct a business. Indirectly,
employment is affected by the provisions on the protection of personal
data, equality, the prohibition of discrimination and the integration of
disabled people. Workers’ rights to be informed and consulted by
employers and to participate in collective bargaining and collective
action is also acknowledged. In relation to social security matters, the
Charter recognises the right of access to social security benefits,
social services and placement services. Other provisions are strictly
work-related, such as the right to protection against unjustified
dismissal, to fair and just working conditions, the prohibition of child
labour, the protection of young people at work and the right to
reconcile work and family life.
2. Transfer of functions and services to the
Generalitat of Cataluña on Inspector’s Public Function of the Labour and
Social Security Inspection
Royal Decree 206/2010 of 26 February transfers the duties and
services of the Labour and Social Security Inspectorate to the regional
government of Catalonia (Spanish Official Gazette of 1 March 2010).
By virtue of the Royal Decree, the duties and services of the Labour
and Social Security Inspectorate are transferred to the regional
government of Catalonia, which will coordinate and collaborate these
activities when necessary with the Central State Administration.
Those duties and services performed by the Central State
Administration that have been transferred to the government of Catalonia
concern labour and social security inspectors and employment and
social security sub-inspectors in Catalonia. In terms of structure and
duties, these inspectors will now come under the authority of the
government of Catalonia of Catalonia, although it must coordinate the
recruitment of new inspectors with the Central State Administration.
The transfer aims to achieve a more effective inspection service,
carried out through a single, comprehensive inspection system that
unites the activities of the various different bodies of inspectors. The
labour and social security inspectors and the employment and social
security sub-inspectors are entitled to carry out investigations and
inspections into all types of employment matters within the scope of
their respective powers and competences, even if these are the
responsibility of an authority other than their own.
The hearing and resolution of disciplinary proceedings for the breach
of employment regulations or the settlement of amounts owed to the
Social Security are the responsibility of the competent authorities in
those areas.
Despite the transfer, a number of powers are reserved to the Central
State Administration.
3. Collaboration between the Ministry of Labour and
Immigration and the Labour Department of the regional government of
Catalonia
Resolution dated 5 March 2010, by means of which the Technical
Secretariat published the collaboration agreement between the Ministry
of Labour and Immigration and the Labour Department of the regional
government of Catalonia on the organisation and operation of the Labour
and Social Security Inspectorate in Catalonia (Spanish Official Gazette
of 9 March 2010).
An association of the Labour and Social Security Inspectorate is to
be set up before 1 May 2010 as a bilateral mechanism to facilitate
cooperation between the Central State Administration and the regional
government of Catalonia in relation to the Labour and Social Security
Inspectorate in the region of Catalonia.
The transfer of the Labour Inspectorate to the regional government of
Catalonia is based on the principle that the inspection service should
act as one and with a single purpose on all matters regarding work and
employment. To safeguard this principle, labour and social security
inspectors and work and social security sub-inspectors should enjoy the
same working conditions, including remuneration.
The Central State Administration and the regional government of
Catalonia believe that the existing regulations on the Labour and Social
Security Inspectorate need to be amended in accordance with new
developments, while maintaining a consistent and consolidated system.
The agreement refers to the principle that access to, mobility within
and collaboration between the authorities should be equal as the basis
for the assignment of the functions of the inspectorate to the regional
government of Catalonia, and sets out general provisions to safeguard
these principles as regards selection processes and the provision of
jobs and training, discipline and conditions of re-entry for civil
servants of both the Central State Administration and the regional
government of Catalonia.
4. Electronic transfer to the Public Employment
Service of official earnings records
Order TIN/790/2010 of 24 March on the electronic transfer to the
Public Employment Service of contribution records (Spanish Official
Gazette of 30 March 2010).
According to the Order, all employers must send the contribution
record to the Public Employment Service through the Internet if they
have employees, operate in Spain and contribute to the Social Security.
The record must be sent when employees terminate, suspend or reduce
their employment relationship and notify the company of their intention
to apply for unemployment benefits. The submission of this record
through the Internet exempts workers from their obligation to enclose
this document when applying for unemployment benefits.
However, the official earnings record may only be sent to the Public
Employment Service using the certific@2 application.
5. Tax, labour and social security fraud prevention
plan
On 5 March the Council of Ministers approved a comprehensive plan
towards preventing tax, labour and social security fraud. The plan sets
out sixty measures based around four core areas: prevention and
promotion of voluntary compliance, improvement of data collection
systems by means of the Tax Authority, Social Security General Treasury
and the Labour and Social Security Inspectorate sharing their databases,
the implementation of joint control measures to complement those already
carried out separately by each body, and the design of coordinated
payment collection methods to increase their efficiency.
With regard to the prevention of labour-related fraud, the general
objective of promoting voluntary compliance is to be achieved through
two specific measures: the collaboration of social partners in the
detection of occasional goods transportation activities and the
monitoring of transnational services. Particular emphasis is also to be
placed on monitoring the following risk areas: sweatshops, seasonal
agricultural work, retail establishments with notoriously low prices,
the misuse of work experience/scholarship contracts, contracts
subsidised by autonomous communities, and companies compliance with
occupational advert prevention measures in order to reduce the costs
they represent for the social security system.
With regard to social security fraud, voluntary compliance is to be
encouraged by publicising the measures taken by the Social Security
General Treasury among businesses, workers and people on benefits. Risk
areas that must be carefully monitored include: wrongful cancellation of
consolidated registrations through the network system and related to
short periods of time, social security registration of partial
retirement cover workers; unlawful registration of workers, multiple
jobholders and impersonation of illegal foreign workers; management of
medium-sized and large-sized companies’ social security debts;
investigation of alleged criminal offences related to social security
infringements or derived therefrom, and joint monitoring of unemployment
and social security benefit fraud.
6. Labour courts jurisdiction. Deductions from back
pay
Judgment of the Labour Chamber of the Supreme Court dated 24
November 2009
In a change to its case law, the Supreme Court held in this judgment
that the labour courts are competent to rule on the deduction of income
tax and employee social security contributions from back pay awards. The
Labour Chamber held that, in those cases where the determination of
whether or not tax withholdings must be made is merely incidental to the
main proceedings, it is the labour courts that should interpret and
apply the law.
When a back pay judgment becomes final, the court replaces the debtor
(employer) by paying the creditor (employee), and therefore it must make
the payment in the same terms as the employer would have done.
Consequently, the deductions imposed by laws and regulations must be
made by the court enforcing the award. Otherwise, the creditor would
benefit unfairly at the expense of the debtor.
7. Saturdays falling between the submission of a
conciliation request and the conciliation hearing are not taken into
consideration for the calculation of a dismissal action statute of
limitations period
Judgment of the Labour Chamber of the Supreme Court dated 21
December 2009
The judgment of the Labour Chamber of the Supreme Court (“SC”)
overturned a judgment of the High Court of Justice of Castille-La Mancha
(“HCJ”) which had held that the statute of limitations period for
a dismissal action had expired. Under Spanish law, if the period between
the submission of a conciliation request and the conciliation hearing is
less than 15 days, the prescription period is tolled until after the
hearing. In calculating that 15-day period, the HCJ had included
Saturdays falling between the request and the hearing on the basis that
the term was administrative. The SC heard the case based on an appeal
seeking the unification of doctrine and held that as Saturdays are not
business days, they should not be used in calculating the 15-day period.
8. Termination of an employment contract after a
request to have employment status changed to permanent or indefinite is
not a breach of the guarantee of indemnity
Judgment of the Labour Chamber of the Supreme Court dated 22
December 2009
The judgment of the Supreme Court (“SC”) unifies doctrine and
upholds the judgment issued by the High Court of Justice of the Canary
Islands (“HCJ”) that had held a public authority’s decision to dismiss
two employees rendering services by virtue of fixed-term contracts as
unfair, as opposed to null. When the employment contracts were set to
expire in three weeks, the employees filed a request to have their
employment status changed to either permanent or indefinite. The SC
upheld the HCJ’s judgment that had rejected the petition for the
annulment of the dismissal basing its decision on insufficient evidence
supporting a violation of the guarantee of indemnity. The SC held that
the authority’s decision was not based on discriminatory grounds or
taken in retaliation for the employees exercising a right.
9. In the absence of an express CPI forecast in the
State Budget Law, the forecast for public pensions contained in the
State Budget Law applies for the salaries review provided in a
collective bargaining agreement that referred to the CPI forecast
Judgment of the Labour Chamber of the Supreme Court dated 18
February 2010
The Supreme Court confirmed the decision of the Labour Chamber of the
National Court stating that, although not expressly, the State Budget
Law does in fact contain a consumer price index forecast for the year in
question, because it provides for a 2% increase in civil servant
pensions and the state pension. This increase in pensions is in line
with articles 27 of the revised text of the Civil Service Pensions Law
and 48 of the revised text of the Social Security Law, both of which
stipulate that pensions must be reviewed “based on the consumer price
index for the relevant year.” Consequently, according to the
National Court’s ruling, which was confirmed by the Supreme Court, the
pension increase constitutes an implied acknowledgment of the government’s
CPI forecast.
10. If the CPI forecast exceeds the official CPI, a
company can deduct the difference in salary in subsequent payslips
Judgment of the Labour Chamber of the National Court dated 26
January 2010
The purpose of this ruling was to determine whether a provision of a
collective agreement that provides for salary increases in accordance
with the CPI forecast in the State Budget Law that are subsequently
adjusted in line with the official CPI, is applicable only when the CPI
is higher than forecasted, as the claimants contended. The Labour
Chamber rejected the claim on the grounds that salary payments made
before the official CPI is published must be adjusted, regardless of
whether this is favourable to the company or the employee. Therefore,
the reduction in salary applied by the company in this case as a result
of the official CPI being lower than that forecasted in the State Budget
Law was lawful because it was consistent with the terms of the
collective bargaining agreement.
11. Individual and collective dismissals. Insolvency
Judgment of the High Court of Justice of Castille and León dated
17 December 2009
The High Court upheld a first instance judgment which declared that
the judge in charge of a company’s insolvency proceedings was competent
to hear the dismissal claims of its employees. The court clarified that
individual dismissal claims that are considered collective claims
pursuant to article 64.10 of the Insolvency Law are only collective for
the purposes of that article.
The court jointly interpreted articles 8 and 64 of the Insolvency Law,
and among others, concluded that despite the fact that the commercial
courts have jurisdiction over collective dismissals in the event of
companies’ insolvency, the labour courts continue to have jurisdiction
over individual dismissals, and that if a collective dismissal takes
place due to a company breach of article 50.1.b) of the Statute of
Workers, the employee claims must be processed by means of a collective
dismissal procedure.
12. Non-professional use of the Internet during working
hours. Lack of adequate technical and security measures
Judgment of Labour Court number 2 of Badajoz dated 17 September
2009
A worker filed a claim in response to his dismissal, which his
employer had based on the grounds that he had used the Internet for
personal purposes during working hours and that he had been informed
that this was prohibited. A notary’s report was submitted to show that
the worker had used his work computer to access a number of websites
during working hours which bore no relation to his profession. However,
it was also proven in the trial that the computer lacked a “proxy” or
“firewall” system, without which data concerning the identity of the
user could be changed. In addition, it was proven that the computer
lacked a security system to prevent external access, and that the
Internet navigation program could not keep track of the time. Therefore,
as the report did not prove that the visits to non-work related websites
were carried out by the claimant during working hours, the Labour Court
fully upheld the worker’s claim by declaring his dismissal to be unfair.
