January 2011
Labour Law
INDEX
Social Security. Payment system for 2011
Order TIN/41/2011 of 18
January establishes the 2011 contribution bases and rates for the Social
Security, unemployment, the Salary Guarantee Fund and professional
training.
Transfer of undertakings.
Concept of “transfer”
Transfer of undertaking
legislation does not apply to a situation in which a municipal authority
that has contracted out a service to a private company decides to
terminate its contract with that company and to carry out the service
itself by hiring new staff for that purpose.
The period for claiming
compensation from an employee runs from the moment the company becomes
aware of the damage
The Supreme Court held
that the period for claiming an amount owed by an employee to a company
begins to run from the moment the company becomes aware of the damage,
without there having to be a previous judicial declaration recognising
the damage.
Suspension of unemployment
benefits
The receipt of one-time
income exceeding the maximum income threshold to receive unemployment
benefits results in a suspension of benefits but not their termination.
Profit-related pay
established in the Collective Bargaining Agreement on Private Banking
breaches EU law as it differs between national and foreign entities
The Supreme Court held
that a Spanish branch of a bank registered in an EU Member State must
not be considered a foreign bank for the purpose of calculating profit-related
pay as regulated in article 18 of the Collective Agreement on Private
Banking.
Pay slips must be
delivered in paper form
The Labour Chamber of
the National Court held that the delivery of pay slips by means of
personal access to the corporate website may reduce the evidential value
of both the amount paid and the itemised levels of remuneration owing to
the lack of the employees’ signature and the company seal.
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Social Security. Payment system for 2011
Order TIN/41/2011 of
18 January 2011 develops the regulations on contributions to the Social
Security, unemployment, the Salary Guarantee Fund and professional
training established in Law 39/2010 of 22 December on the national
budget for 2011
Order TIN/41/2011
establishes that the maximum contribution base to the General Regime of
the Social Security will be EUR 3,230.10 per month as of 1 January 2011.
The minimum contribution base for work-related accidents and
professional illnesses will be EUR 748.20 per month.
The payment rates will
be the same as those of 2010.
The minimum and maximum
contribution bases for self-employed workers will be EUR 850.20 and EUR
3,230.10 per month, respectively. The contribution base for those aged
50 or over as of 1 January 2011 will range from EUR 916.50 to EUR
1,682.70 per month. Nevertheless, the contribution base will
range from EUR 850.20 to EUR 1,682.70 per month if the self-employed
worker is 45 years of age or over and had to register with the General
Regime of the Social Security as a result of taking over the business of
his/her deceased spouse.
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Transfer of undertakings. Concept of “transfer”
Judgment of the
European Court of Justice dated 20 January 2011
This judgment concerns
the interpretation of article 1(1)(b) of Council Directive 2001/23 of 12
March 2001 relating to the safeguarding of employees’ rights in the
event of transfers of undertakings, businesses or parts of undertakings
or businesses.
In this case, a
municipal authority that had contracted out the cleaning of its premises
to a private company decided to terminate its contract with that company
and to carry out the cleaning services itself, by hiring new staff for
that purpose. As a consequence, one of the company’s employees was
dismissed.
The dismissed employee
claimed that her case fell within the scope of article 1(1)(a) and (b)
of Directive 2001/23 and that she should be taken on as an employee of
the municipal authority.
On referral, the
European Court of Justice held that this Directive applies to public
undertakings engaged in economic activities. However, a condition for
the application of the Directive is that the transfer must concern an
economic unit which retains its identity after the change of employer.
In the Court’s opinion,
the mere fact that the activity carried out by the company and that
carried out by the municipality are similar, even identical, does not
mean that the economic unit has retained its identity. In particular,
the identity of an economic unit, such as that forming the subject of
the dispute in the main proceedings, which is essentially based on
manpower, cannot be retained if the majority of its employees are not
taken on by the alleged transferee.
In conclusion, the mere
taking over by the municipality of the cleaning service that was
previously carried out by the company does not amount to a transfer of
undertaking pursuant to Directive 2001/23.
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The period for claiming compensation from an employee runs from
the moment the company becomes aware of the damage
Judgment of the
Labour Chamber of the Supreme Court dated 24 November 2010
The case concerns an
employee who was dismissed due to the abusive use of a work mobile phone.
Although it was intended solely for professional use, the employee made
regular personal calls. The Labour Court declared the dismissal fair,
and the High Court of Madrid later ratified this decision. Eleven months
after the judgment was confirmed by the High Court, the company claimed
EUR 12,000 in compensation from the former employee for the cost of the
personal phone calls. The claim was allowed by the Labour Court but
rejected by the High Court of Madrid. The basis for the High Court’s
ruling was that the right to claim the amount had prescribed, as over
one year had elapsed since the company became aware of the damage caused
by the employee. An appeal against the ruling was filed with the Supreme
Court.
The problem in this
case centres on when the period for filing a claim for compensation
against the employee begins to run; whether this be from the moment the
damage is recognised by a court, or from the moment the company becomes
aware of the damage.
The Labour Chamber of
the Supreme Court held that from the moment the company becomes aware of
the actual damage, a claim may be filed without having to wait for a
judicial declaration of the damage. Based on this interpretation, any
delay in filing a claim must be considered a waiver of the right.
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Suspension of unemployment benefits
Judgment of the
Labour Chamber of the Supreme Court dated 28 October 2010
This Supreme Court (“SC”)
analysed a case involving an individual who received a capital gain on
the sale of a financial instrument while simultaneously receiving
unemployment benefits for individuals over the age of 52. As a result of
that individual gain received in December 2006, the Spanish Public
Employment Service issued a resolution invalidating the subsidy as from
January 2007 on the basis that the maximum income threshold for 2006 had
been exceeded. The beneficiary argued that the right to receive the
subsidy should only be suspended during the month in which the income
was received.
The legal question
involved the characterisation of the one-time benefit in connection with
a beneficiary’s right to receive unemployment benefits.
The SC held that the
analysis had varied since 2002 as a result of the amendment of article
219.2 of the Social Security Law. The calculation of income received by
a beneficiary of unemployment benefits was previously analysed on an
annual basis. As a result, benefits were extinguished if the annual
maximum was exceeded, irrespective of whether or not the income was
extraordinary. Nevertheless, the SC held that, following legislative
amendments, unemployment benefits are currently extinguished only if the
beneficiary regularly obtains income throughout the year and not if a
single amount is received in any given month.
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Profit-related pay established in the Collective Bargaining Agreement
on Private Banking breaches EU law as it differs between national and
foreign entities
Judgment of the
Labour Chamber of the Supreme Court dated 6 July 2010
A collective claim was
filed at the Spanish National Court by a Spanish branch of a bank
registered in an EU Member State. The Spanish branch claimed that it
should not be considered a foreign bank for the purposes of calculating
the profit-related pay regulated in article 18 of the XXI Collective
Bargaining Agreement on Private Banking which establishes a different
procedure for national and foreign banking entities. The collective
claim was dismissed by the Spanish National Court and therefore the
company lodged an appeal before the Supreme Court.
The appeal centered on
the scope of application of article 18 of the Collective Bargaining
Agreement on Private Banking and its failure to consider whether or not
banking entities are registered in EU Member States which operate in
Spain through a branch.
The company claimed
that the provision of the Collective Bargaining Agreement breaches the
general principles of EU law, such as the freedom to provide services,
the freedom of establishment and freedom of competition within the
European Union.
The Supreme Court
upheld the appeal by holding that article 18 of the abovementioned
Collective Bargaining Agreement opposes the EU law principle of the
freedom to provide services, because it establishes more onerous working
conditions on a European company which operates through a branch in
Spain than on Spanish credit institutions.
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Pay slips must be delivered in paper form
Judgment of the
Labour Chamber of the National Court dated 9 December 2010
A collective claim was
filed by the pilots’ union SEPLA against an airline company after the
company unilaterally decided to stop delivering pay slips in paper form
and instead decided to include them on the corporate website, where the
employees could check them by introducing a personal password. The
union believed that this decision should have been taken following
consultation and in the absence of any such process, that the company
should be requested to continue delivering the pay slips in paper form.
The Court held that the
company's decision deprived the employees of a means of evidencing
payment established by law. The lack of the worker's signature and of
the company seal prevented the evidential capacity of the documents to
confirm both the amount paid to the employees and an itemised statement
determining the remuneration.
The Court held that the
company's decision did not comply with the provisions of the Collective
Bargaining Agreement, which did not include the right to unilaterally
modify the form of delivery of pay slips. The Court also questioned the
legality of any individual agreements which allow such a replacement to
take place.
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