Law 9/2015 of 25 May on urgent measures on insolvency includes amendments to labour matters.
The most significant labour-related amendments are increased powers of the insolvency administration in labour proceedings and the inclusion of dependent self-employed workers (TRADEs) as labour creditors.
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Royal Decree 357/2015 of 8 May on the fulfilment and control of the application to Spanish vessels of the Maritime Labour Convention, 2006, of the International Labour Organization, distributes powers in this area among the Labour and Social Security Inspectorate, the Social Marine Institute and the General Directorate of the Merchant Marine (as part of the Ministry of Development).
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The Secretary of State for Social Security’s Resolution of 4 May 2015 establishes the General Plan for Preventive Activities of the Social Security to be applied by mutual insurance companies in 2015.
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The Court of Justice of the European Union rules that the Spanish legislation on collective redundancies is contrary to EU law when the application of the undertaking criterion precludes the information and consultation procedure provided for in EU directives, and the dismissals in question would have been considered collective redundancies had the establishment been used as the reference unit.
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The Supreme Court ruled that the collective redundancy at Coca-Cola Iberian Partners Group is void because it breaches the employees’ right to strike. The Supreme Court held that the company replaced the employees at workplaces on strike with workers at other workplaces with the aim of minimising the impact of the strike. The company’s actions weakened the employees’ position during the redundancy consultation period.
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The Supreme Court ruled that the novation, renewal, or replacement of an outsourcing contract by a subsequent contract with the same client and the same object are not valid grounds to terminate temporary contracts for specific projects or services.
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A collective bargaining agreement remains in force even after the extended period of validity established by law if it contains a provision complying with article 86.3 of the Statute of Workers stating that it will remain in force until a new agreement is reached. The Supreme Court has held that the date this provision is signed is irrelevant.
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The Supreme Court declared two articles of the collective redundancy regulation null.
Article 35.3 of Royal Decree 1483/2012 of 29 October approving the regulation on collective redundancy, employment contract suspension and working time reduction is null because it does not require budget shortfalls to be unexpected and continuous for a collective redundancy in the public sector to be justified.
Final Provision Two of this law is also declared null because it allows companies to notify the Social Security of the implementation of a collective redundancy. This function is reserved to the labour authorities by law.
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Although the general rule is that related salary items can be set off, unrelated salary items can also be set off if there is an express agreement between the parties, or it is provided for in the relevant collective bargaining agreement.
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A company can monitor an employee’s job performance through the GPS on a company car used solely for labour purposes. This does not require the employee’s express consent.
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1. INSOLVENCY LAW REFORM
Law 9/2015 of 25 May on urgent measures on insolvency
Law 9/2015 of 25 May on urgent measures on insolvency amends Spain’s Insolvency Law in order to make enable an insolvent company to continue its commercial activity, as this is considered to be beneficial for the company itself, its employees, its creditors and the economy as a whole.
Law 9/2015 introduces the following labour measures:
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The powers of the insolvency administration in labour proceedings have been increased. Administrators can now intervene and enforce court decisions in the following labour proceedings: (i) for collective substantial changes in working conditions, (ii) collective redundancies, (iii) collective relocations, (iv) suspensions of employment contracts, and (v) reduction of working hours.
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The list of labour creditors has been increased to include dependent self-employed workers (referred to as TRADEs by their Spanish acronym).
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2. maritimE WORK ON spanish vessels
Royal Decree 357/2015 of 8 May on the fulfilment and control of the application to Spanish vessels of the Maritime Labour Convention, 2006, of the International Labour Organization
Royal Decree 357/2015 contains the rules governing the supervision, control and guarantee regarding the implementation of the Maritime Labour Convention, 2006, of the International Labour Organization on Spanish vessels.
According to Royal Decree 357/2015, the Labour and Social Security Inspection is entrusted with the authority to supervise and control the enforcement of laws related to work relations, trade union matters, prevention of occupational hazards, Social Security and employment.
Secondly, the Social Marine Institute will have authority to conduct programmes related to maritime safety, recognition of social security benefits related to seafarers, medical assistance and control of on-board healthcare resources.
Lastly, the General Directorate of the Merchant Marine will have authority over the general planning of seafaring and the civil fleet.
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3. General plan on PREVENTIVE ACTIVITIES OF THE social security to be APPLIED by mutual insurance companies
The Secretary of State for Social Security’s Resolution of 4 May 2015 establishes the General Plan for Preventive Activities of the Social Security to be applied by mutual insurance companies in 2015
The Resolution extends the validity of the programmes, criteria and priorities for 2015 to be applied by mutual insurance companies in planning social security preventive activities. Certain aspects of the industry sectors subject matter of the programmes have been updated.
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4. the court of justice of the european union clarifies the concept of “ESTABLISHMENT” for the purpose of collective redundancies
Judgments of the Court of Justice of the European Union dated 30 April 2015 (case C-80/14) and 13 May 2015 (cases C-182/13 and C-392/13)
The Court of Justice of the European Union (“CJEU”) examined the interpretation of directives on the approximation of the laws of Member States relating to collective redundancies.
In case C-392/13, the CJEU responds to a request for a preliminary ruling from Labour Court No. 33 of Barcelona by holding that the definition of collective redundancy under Spanish law is contrary to EU law.
According to EU law, an “establishment” (i.e. workplace) refers to the entity to which the workers who are made redundant are assigned to carry out their duties. Therefore, the number of dismissals in each establishment must be taken into consideration.
On the other hand, Spanish legislation introduces the “undertaking” and not the establishment as the sole reference unit in order to determine the existence of a collective redundancy.
The CJEU therefore declared that Spanish legislation is contrary to EU law when the application of the undertaking criterion precludes the information and consultation procedure provided for in the directive, and the dismissals in question would have been considered collective redundancies had the establishment been used as the reference unit.
In the other cases, the CJEU examines two preliminary rulings concerning the compatibility of English law with EU law and Irish law with EU law. In both cases, national legislation establishes that workers must be informed and consulted about dismissals when at least 20 workers from a particular establishment of an undertaking are dismissed (within a 90-day period). Nevertheless, this procedure is not foreseen where the aggregate number of dismissals across all of the establishments, or across some of the establishments of an undertaking, reaches or exceeds the threshold of 20 employees (also within a 90-day period).
Unlike the first case regarding Spanish law, the CJEU held that English law and Irish law are not contrary to EU law.
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5. collective redundancy declared VOID for breaching right to strike
Judgment of the Labour Chamber of the Supreme Court dated 20 April 2015
The Supreme Court (“SC”) upheld the decision of the National Court (“NC”) which declared void the Coca-Cola Iberian Partners’ group collective redundancy.
During the consultation period, the employees of the Fuenlabrada workplace decided to call an indefinite strike to put pressure on the company not to proceed with the collective redundancy. In view of the strike, the company replaced the production at the Fuenlabrada workplace (which had stopped because of the strike) with production at other bottling plants of the Coca-Cola Iberian Partners’ group.
The SC considered the company’s actions to be a breach of the employees’ right to strike. The court held that the company minimised, or even neutralised, the negative effects of the strike and therefore weakened the employees’ bargaining power. Accordingly, the collective redundancy was declared void because it breached the fundamental right to strike.
The SC held that when a collective redundancy is declared void, reinstatement of the employees requires payment of the corresponding back-pay. In order to ensure compliance with the judgment in the future, a company will have to take that amount of time into account in the event of an appeal.
The judgment contains a dissenting opinion.
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6. TEMPORARY contracts for specific projectS or serviceS do not COME TO AN END because of the TERMINATION of an outsourcing contract when A company enters into a SUBSEQUENT contract with the same client
Judgment of the Labour Chamber of the Supreme Court dated 20 March 2015
In this case, on the termination of an outsourcing contract, the company terminated the temporary contracts for specific projects or services that were linked to the outsourcing contract. Immediately after, the company entered into a contract which had the same object as the first outsourcing contract with the same contractor. In view of the above, a worker whose contract was terminated challenged the termination of temporary contracts.
After analysing the case, the SC, on unification of doctrine, held that the novation, renewal, or replacement of an outsourcing contract by a subsequent contract with the same client and the same object does not terminate temporary contracts for specific projects or services because (i) the project or service which gave rise to the contract and (ii) the temporary need for a workforce continues. Moreover, although the new contract may change its object, the temporary contracts for specific projects or services would remain valid.
The temporary contracts for specific projects or services would also continue to be effective despite the inclusion of some conditions in the subsequent contract not incorporated into the first contract. In particular, in the event that these new conditions mean that staff restructuring will be required, a company should implement labour adjustment measures or carry out dismissals.
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7. collective bargaining agreements REMAIN valid if an agreement extending their validity is reached, regardless of WHEN
Judgment of the Labour Chamber of the Supreme Court dated 17 March 2015
In this case, a company argued that its collective bargaining agreement (which predated the 2012 Labour Reform) had expired, as one year had passed since a request to renegotiate it was made without an agreement to extend its validity having been reached.
The SC considered when a provision, pursuant to which the validity of a collective bargaining agreement is extended until an agreement is reached (article 86.3 of the Statute of Workers —“SW”—), has to be signed for it have effect.
The SC held that the inclusion in a collective bargaining agreement of a provision stating that it will remain in force until a new agreement is reached is valid regardless of when the provision is signed.
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8. TWO ARTICLES OF thE collective redundancY reGULATION ARE DECLARED null
Judgment of the Contentious-Administrative Chamber of the Supreme Court dated 19 May 2015
This case involves an appeal lodged by two trade unions against Royal Decree 1483/2012 of 29 October approving the regulation on collective redundancy, employment contract suspension and working time reduction (the “Regulation”).
The SC declared article 35.3 of the Regulation null because, contrary to Additional Provision Twenty of the SW, budget shortfalls need not be unexpected and continuous to implement a collective redundancy in the public sector.
The SC also declared Final Provision Two of the Regulation null. This article relates to notifying the implementation of a collective redundancy to the body managing unemployment benefits. While according to the SW and the General Social Security Law this notification is to be made by the labour authorities, the Regulation states that the company has exclusive authority to notify the Social Security of the implementation of the collective redundancy.
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9. THE SETTING OFF of unrelated SALARY items IS lawFUL in certain cases
Judgment of the Labour Chamber of the National Court dated 8 January 2015
The NC examined the appropriateness of the business practice of setting off the length of service increment. This measure only affected a group of employees of the company (those who in 2011 completed a new three-year period). The NC also examined whether or not the three-yearly increase paid in 2011 had become an acquired right.
The NC held that despite the general rule, these arrangements are also permitted where there is an express agreement between the parties or if it is established in the collective bargaining agreement. It is an issue that greatly depends on each particular case.
Regarding the second issue, the NC ruled that the three-yearly increase is not an acquired right, because the payment of unrelated items only applies from 2011 onwards.
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10. a company can use the gps installed In A company car to MONITOR its employees’ BEHAVIOUR without the employee’s consent
Judgment of the Labour Chamber of the High Court of Justice of Castilla-La Mancha dated 23 March 2015
The High Court of Justice of Castilla-La Mancha (“HCJCM”) examined the fairness of a security guard’s disciplinary dismissal.
In this case, the employee was dismissed from the company on the grounds of several disciplinary breaches. The company became aware of these through a GPS device installed in a company car which the employee used solely for professional purposes. The dispute arose because the employee had not given his express consent to the monitoring system.
The HCJCM held that a company can monitor the job performance of its employees through the data obtained from a GPS device installed in a company vehicle used solely for labour purposes in the working day. Employees can be monitored regardless of whether they have given their express consent.
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1. INSOLVENCY LAW REFORM