The Spanish
government has approved Royal Decree 20/2011 of 30 December on urgent
public budget, tax and financial measures, which aims to reduce the
budget deficit and achieve budgetary stability.
Order ESS/1/2012
of 5 January establishes the 2012 procedure for recruiting foreign
employees by way of seasonal contracts or contracts for specific works
or services.
The Spanish
Supreme Court reaffirms the interpretation that an employer is allowed
to monitor the use of computer resources by employees.
The Supreme
Court has once again ruled that the bilateral nature of non-compete
agreements means that their fulfilment cannot be left to the discretion
of one party.
This judgment
establishes an exceptional circumstance in which a golden parachute
clause in a senior management contract was held invalid on the basis
that the manager was not a good faith third party.
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1. ROYAL DECREE-LAW
20/2011 OF 30 DECEMBER
Royal Decree-Law
20/2011 of 30 December on urgent public budget, tax and financial
measures to reduce the budget deficit
This Royal
Decree-Law (“RDL”) affects many areas, however this
newsletter only analyses labour matters.
One of the most
important measures is the freezing of public sector workers’
remuneration, which includes salary costs, occupational pension scheme
contributions and collective insurance contracts that also cover
retirement benefits. The salary freeze affects all levels of public
sector workers, including senior management posts. This measure may be
avoided if the Treasury Department issues a report to such effect.
Public sector
access exams have been suspended for 2012. As a result, public
authorities will not employ any new personnel, except for individuals
who were selected during previous processes. The 2012 suspension also
applies to temporary employees becoming permanent employees or public
sector workers who fall under the scope of the Basic Statute of Public
Sector Employees.
Temporary staff
will not be employed to cover vacancies except in exceptional cases
where there is an urgent need that must be met immediately. These
exceptional circumstances will be restricted to sectors, positions and
professional categories that are considered priorities or that affect
essential public services, such as the armed forces, the healthcare
sector, education and public bodies dedicated to monitoring and fighting
against tax evasion and labour fraud.
Article 13
updates the social security contribution bases and rates applicable to
groups such as self-employed workers or self-employed agricultural
workers. The average ordinary working week of a public sector worker
must not exceed 37 and a half hours.
The professional
requalification programme for individuals who use up their unemployment
benefits is extended by six months.
In addition, the
latest date to start training activities under training and
apprenticeship contracts signed between 31 August 2011 and 30 September
2011, has been extended to 31 January 2012.
Law 9/2009 of 6
October, which extends the duration of paternity leave for the birth,
adoption and fostering of children, will not enter into force until 1
January 2013.
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2. PROCEDURE FOR THE
COLLECTIVE RECRUITMENT OF NON-EU EMPLOYEES IN THEIR COUNTRIES OF ORIGIN
Order ESS/1/2012
of 5 January, regulating collective recruitment in countries of
origin for 2012
Order ESS/1/2012
(the “Order”) was published in the
Official Spanish Gazette of 6 January and entered into force on the same
day. The Order establishes the 2012 procedure for recruiting non-EU
employees in their countries of origin.
After consulting
the autonomous communities and receiving information from the Spanish
Public Employment Service on the national employment situation, the
Ministry of Labour and Social Security has decided not to approve
permanent employment contracts and not to grant search work permits to
children and grandchildren of Spanish emigrants. Furthermore, visas for
certain occupations will not be granted.
The Order only
sets out the specifications concerning the recruitment of seasonal
employees or employees with contracts for works or services.
Temporary job
offers include the following:
(a) seasonal
activities with a maximum duration of nine out of twelve consecutive
months. In agricultural activities the contracts may be unified or
linked; and
(b) work or
services with a maximum duration of one year. Activities include the
assembly of industrial plants or power plants, the construction of
infrastructures, buildings and railways, networks for the supply of gas,
electricity and telephone services, the installation and maintenance of
production equipment as well as its start-up and repair.
In the selection
processes held in the countries of origin, employers may directly or
indirectly participate, upon request, as may representatives of the
Directorate General of Immigration. Trade union and employer
representatives may also act as consultants in the process, provided the
governments of both countries request their participation.
Applications
must be made on an official form and submitted at least three months
prior to the start of the activity. This must be accompanied by the
documentation specified in the Order. Preference will be granted to
applications from countries with which Spain has entered into migration
agreements.
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3. RIGHT
TO PRIVACY
IN THE WORKPLACE
Judgment of the
Labour Chamber of the Supreme Court dated 6 October 2011
In this case, an
employee filed a claim against her employer after she had signed a
letter that the company had sent all employees informing them of the
prohibition to use company resources for personal use during and after
working hours.
The company
subsequently and without providing any notice, carried out an inspection
and checked the computers of the claimant and of another employee. The
inspection was carried out using a “non-invasive” software program
through which files with passwords could not be accessed.
The claimant,
the technicians who install the software, company and employee
representatives and two employees were all present while the computer
was being checked.
The Supreme
Court considered whether reasonable personal use of computer resources
by employees had been generally tolerated by the company. If so, a "reasonable
expectation of confidentiality" would have been created for the employee
in relation to the improper use of computer resources, which would limit
the employer’s capacity to control their use.
The key question
was whether or not an employee has the right to use computer resources
for personal use even when the company has expressly prohibited it and
warned of the possibility of inspections.
The Supreme
Court held that although the company had not expressly issued a warning
regarding the potential installation of software to monitor the use of
computer resources, the prohibition was so categorical that there was no
room to consider that the employee has a right to privacy when using the
computer resources put at his/her disposal. Otherwise, an employee could
create a privacy stronghold using resources that do not belong to him/her
and the use of which is subject to his/her employer’s instructions.
The court found
that if there is a prohibition there is no tolerance and thus no
“reasonable expectation of confidentiality”, regardless of the
information provided by the company in relation to monitoring, employee
control and their scope.
The dissenting
judges in this case considered that the judgment was a step-back in the
protection of fundamental rights, namely, an employee’s right to privacy,
because although the company notified the employees of the prohibition
to use company resources for personal use, it did not inform about the
potential monitoring and controls. Therefore, in the opinion of the
dissenting judges, the company created a "reasonable expectation of
privacy" and any breach of that expectation constitutes the employer’s
interference with the employee’s right to privacy in the performance of
his/her work.
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4. Non-compete clause
Judgment of the
Labour Chamber of the Supreme Court dated 8 November 2011
Pursuant to an
employee’s employment contract, for the duration of the contract and the
six months following its termination, the employee could not perform a
similar activity to that she performed in her current post. As
consideration, upon termination the employee was entitled to be paid one
third of her average wage over the last year. However, the company
reserved the right to unilaterally exempt the employee from the
obligation to fulfil the non-compete clause.
The employee
informed the company of her voluntary resignation. However, as she was
going to work in a different sector and would not be competing with her
previous employer, the company refused to pay her the non-compete
compensation.
The first
instance court upheld the employee’s claim, but the Labour Chamber
of the High Court of Justice of Catalonia reversed this judgment on
the grounds that the company could waive the employee’s obligation, and
consequently she had no right to receive the compensation.
On appeal, the
Labour Chamber of the Supreme Court held, in line with its doctrine,
that non-compete agreements create bilateral obligations for the parties
and therefore their fulfilment cannot depend on just one of them. As
such, the clause in this case was invalid.
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5.
GOLDEN PARACHUTES
AND GOOD FAITH THIRD PARTIES
Judgment of the
Labour Chamber of the High Court of Justice of Castile and León
(Valladolid) dated 10 June 2011
The
Labour Chamber of the High Court of
Justice of Castile and León (the “Court”) ruled on
the validity of an indemnity clause in a senior management contract.
Although the dispute remained unresolved at first instance, the Court
began the interlocutory appeal on the
basis of sufficient facts, the appellant’s implicit request, and the
ability of both parties to defend their interests on appeal.
The Court first held the contract to be
valid on the basis of the principle of preservation of contract.
The Court stated that indemnity clauses
are in general legal and designed to strengthen the employee’s position
against a company’s unilateral termination of an employment contract.
The disputed clause was not included in the written contract or
discussed by any managerial body and was instead approved by minority
shareholders.
Under normal circumstances, a senior
manager is afforded protection as a result of his/her capacity as a good
faith third party. Nevertheless, the Court considered that, in this
specific case, there were significant conflicts among shareholders and
the sole purpose of the disputed clause was to ensure more advantageous
economic conditions in connection with an inevitable event—a change in
the decision-making body which would presumably also involve the
dismissal of the manager.
The Court held the golden parachute
clause to be illegal given that it was misleading and its sole purpose
was to cause the company a financial loss. The minority shareholders’
approval of a clause designed to harm the majority shareholders
constituted an abuse of a right.
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