May 2013

LABOUR LAW


 1. a Sanction based SOLELY on images obtained in violation of the fundamental right to privacy by using A video surveillance SYSTEM in the lobby IS null

The Constitutional Court declares sanctions that were based solely on images obtained through video surveillance cameras located in a workplace lobby in violation of the fundamental right to privacy as null. Employees must be informed of the fact that the images obtained will be used to control entry and exit times and that it may be used as evidence for disciplinary measures.

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 2. a COMPANY MUST provide compensation FOR its failure to give a senior executive PRIOR notice of HIS unfair dismissal

The Supreme Court held that a company’s acknowledgement of its unfair dismissal of a senior executive did not exonerate it from its obligation to pay three months' salary in lieu of prior notice, as otherwise this would leave the fulfilment of the contract to the discretion of one of the parties.

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 3. A dismissal is declared unfair if the dismissal letter does not include the date on which the dismissal takes effect

A dismissal was declared to be unfair as the dismissal letter did not include the date on which the dismissal would take effect.

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 4. a company TRYING to amend working conditions WHEN a previous attempt to do so was declared VOID DOES NOT AUTOMATICALLY ENTAIL BAD FAITH

The National Court held that a company can attempt to carry out a substantial amendment of working conditions even if a previous attempt to do so was considered to be void, provided that the second attempt does not replicate the same defects that led the first to be declared void. This is possible even when the new measure is justified on the same grounds as the former one.

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 5. THE TRANSFER OF INFORMATION BY A COMPANY TO COMPANY EMAIL ACCOUNTS PROVIDED FOR EACH trade union does not infringe their fundamental freedom to participate in trade union actiVITIES

The High Court of Justice of Madrid held that a company did not violate the right to participate in trade union activities by providing trade unions with company email accounts to communicate confidential information instead of using the trade unions’ email accounts, as the decision was justified on security and confidentiality grounds.

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 6. A 15% SALARY REDUCTION IS NOT JUSTIFIED IF THE COMPANY IS SIMULTANEOUSLY CARRYING OUT A COLLECTIVE DISMISSAL

A 15% salary reduction simultaneously to a collective dismissal is not justified as the adjustment to the company’s drop in production should already have been achieved with the collective dismissal.

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 7. A judgement declaring a collective dismissal to be VOID can be provisionally enforced

A judgment declaring a collective dismissal to be void can be provisionally enforced based on the mixed nature of the judgment, given that it was not merely declarative in nature. The court held that the dismissed employees had to be reinstated in their positions until the final judgment is issued regarding the validity of the collective dismissal.

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1. a Sanction based SOLELY on images obtained in violation of the fundamental right to privacy by using A video surveillance SYSTEM in the lobby IS null

Judgment of the Constitutional Court dated 11 February 2013

In light of irregularities pertaining to an employee’s entry and exit times, a supervisor ordered that all available means be used to determine whether the employee was fulfilling his obligations regarding his work schedule and working hours. The entry and exit records were compared to two months of video surveillance recordings captured from cameras located in the workplace lobby. It was observed that that the employee had falsified entrance and exit records and had failed to fulfil the corresponding obligations.

The Constitutional Court ("CC") analysed the legality of the evidence obtained through the use of pre-existing video surveillance cameras located in the lobby of the workplace in order to verify the employee’s actual entrance and exit times. Based on the recorded images, the employee was sanctioned with six months of unpaid leave of absence for violating his working hours and falsifying entry and exit records.

The CC held that the recording of images affects the core of the fundamental right to personal privacy and reputation enshrined in article 18.4 of the Spanish Constitution (“SC”). Therefore "the power to always know who is in possession of the personal data and to what use it is being put" is a necessary corollary to article 18.4 of the SC

The fact that the employer did not notify the new use for the images obtained with video surveillance cameras was not legally authorised. The employer was obligated to inform the workers of the new use. The CC determined that the purpose of the recorded images could not be deduced from the location of the cameras and, therefore, the employees could not have been expected to reasonably assume that the images would be used as a means to control entry and exit times.

Based on these findings, the CC held that the sanctions, which were based solely on evidence that violated a fundamental right, must be declared void.

The dissenting judge criticised the overly abstract approach in the majority opinion and the fact that the analysis failed to weigh the employer’s managerial power against the fundamental right to one’s own image and data protection. He disagreed with the majority’s refusal to apply the doctrine under judgment 186/2000 of the CC, stating that the CC’s conclusions would have been the opposite had that approach been applied.

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2. a COMPANY MUST provide compensation FOR its failure to give a senior executive PRIOR notice of HIS unfair dismissal

Judgment of the Supreme Court dated 11 March 2013

The respondent in this case dismissed a senior executive, and acknowledged it was an unfair dismissal by paying the corresponding severance payment. However, the severance was considerably less than that payable for the failure to provide prior notice and the seven days of salary per year of service, which are applicable in cases where the employer withdraws from the contract.

The Supreme Court held that the company’s acknowledgment of its unfair dismissal did not mean that the company did not have to pay three months' salary in lieu of prior notice as otherwise this would leave the fulfilment of the contract to the discretion of one of the parties. This would in turn allow the company to choose the less costly option between withdrawing from the contract or carrying out an unfair dismissal, depending on the senior executive’s length of service, which the Supreme Court did not consider to be acceptable.

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3. A dismissal is declared unfair if the dismissal letter does not include the date on which the dismissal takes effect

Judgment of the Supreme Court dated 27 March 2013

The Supreme Court (“SC”) upheld an appeal to unify precedents, which was lodged by an employee who had been dismissed for disciplinary reasons without his dismissal letter stating the date on which the dismissal would take effect.

The SC rejected the decision of the High Court of Justice of Catalonia, which stated that the date on which the dismissal took effect could easily be deduced from the invitation to collect his full and final settlement on the same day as the delivery of his dismissal letter, by declaring the dismissal to be unfair due to the omission of the date on which the dismissal took effect in the dismissal letter.

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4. a company TRYING to amend working conditions WHEN a previous attempt to do so was declared void DOES NOT AUTOMATICALLY ENTAIL BAD FAITH

Judgment of the National Court dated 12 April 2013

The National Court ("NC") analysed the legality of carrying out a substantial modification of working conditions when a previous attempt was declared to be void. The NC examined the trade union’s arguments on the nullity of the measure based on the company’s bad faith during the negotiations.

The NC stated that a company can try to implement a measure that was previously declared to be void, provided that the second attempt does not replicate the defects that led the first to be declared void. This is possible even when the new measure is justified on the same grounds as former one. However, in this case, the NC took into account the fact that the economic reasons that were deemed sufficient in the first modification had worsened by the time the second attempt was being negotiated.

The NC held that a second modification was valid as long as it had no retroactive effects, as this would go against the effectiveness of the judgment annulling the first modification. It is possible, however, to negotiate with the trade unions in order to delay the reinstatement of employees to their situation prior to the first substantial modification until after the new negotiations were completed. A failure to reinstate employees to their previous situation would affect the validity of these negotiations if it is a unilateral decision of the company as it would be interpreted as an act of bad faith aimed at pressuring employee representatives during the negotiations.

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5. THE TRANSFER OF INFORMATION BY A COMPANY TO COMPANY EMAIL ACCOUNTS PROVIDED FOR EACH trade union does not infringe their fundamental freedom to participate in trade union actiVITIES

Judgment of the High Court of Justice of Madrid dated 1 February 2013

The CGT trade union claimed that its fundamental right to participate in trade union activities had been infringed when a company provided company email accounts for each trade union with representation among its workforce. These accounts were to be used by the company to communicate information to each trade union instead of their own trade union email accounts.

The High Court of Justice of Madrid ("HCJM") rejected the CGT’s infringement claim, holding that there was no violation of the right to participate in trade union activities because the company email accounts had been provided to ensure the secure transfer of confidential business information to various trade unions, and to overcome the frequent technical failures that had been caused by the accounts used previously. The HCJM took into account the fact that providing a company email account to receive communications and information from the company did not affect the trade unions’ ability to communicate with the employees. Additionally, each trade union had its own email account and privacy was ensured because they each had secret passwords to which the company did not have access.

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6. A 15% SALARY REDUCTION IS NOT JUSTIFIED IF THE COMPANY IS SIMULTANEOUSLY CARRYING OUT A COLLECTIVE DISMISSAL

Judgment of the High Court of Justice of Catalonia dated 19 February 2013

Within a collective action procedure, the High Court of Justice of Catalonia (“HCJC”) held that a 15% salary reduction cannot be justified if it is carried out simultaneously to a collective dismissal.

The HCJC held that the adjustment in production levels used by the company as grounds for the measure should have been achieved with the dismissals, as they were based on the need to adapt the size of the workforce to the workload. Conversely, the salary reduction was not a means to achieve this adjustment but merely a cost-cutting measure.

The court also took into account that as a result of the decrease in workload, the employees were no longer being paid a bonus. This meant that there had already been adjustments to wages in order to cut costs.

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7. A judgement declaring a collective dismissal to be VOID can be provisionally enforced

Order of the High Court of Justice of Madrid dated 27 February 2013

The High Court of Justice of Madrid ("HCJM") analysed the possibility of provisionally enforcing a judgment that had declared a collective dismissal to be void and which upheld the right of dismissed employees to be “immediately reinstated” in their positions.

The decision to provisionally enforce a judgment until a final judgment was handed down regarding the validity of a collective dismissal (appealed by the company) was based on the mixed legal nature of the original judgment. Consequently, the HCJM dismissed the company’s arguments regarding the solely declarative nature of the judgment on the grounds that it also contained certain elements that are characteristic of judgments imposing a sentence. These elements rendered it "perfectly enforceable", albeit on a temporary basis. The HCJM ruled that article 297 of the Labour Jurisdiction Law, ordering employers to reinstate employees subject to an unfair dismissal, in relation to articles 113 and 123 of the same regulation, was fully applicable.

The HCJM dismissed the company’s arguments regarding their inability to defend themselves given that issues such as the age and salaries of the employees were not discussed during the proceedings. This was based on the fact that for the purposes of provisional enforcement, the only relevant matter was that of the employees’ salaries when reinstated in their positions. Back pay accrued during the course of the proceedings should be settled in the pending judgment regarding the validity of the collective dismissal.

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The information contained in this Newsletter is of a general nature and does not constitute legal advice