October 2016



The Supreme Court, following European Union (EU) case law, held that the reference point to determine if the thresholds separating individual objective dismissals from collective redundancies are exceeded is (a) a workplace with more than 20 employees if the redundancies in that workplace alone exceed the thresholds, or (b) the company, when the thresholds are exceeded in the company as a whole.

2. subcontracting RULES APPLICABLE to an agency contract between a main company and its auxiliary

The Supreme Court rectifies its previous doctrine and holds that agency contracts are subject to the same rules on employment liabilities as the subcontracting of works and services between a main company and its auxiliary.

3. unfairLY dismissED EMPLOYEES ARE ENTITLED TO back pay wheN THEY CANNOT BE reINSTATED: THE requirements

The Supreme Court acknowledged the right of an unfairly dismissed employee to receive back pay when the court issuing the unfair dismissal judgment finds that it was impossible for the employee to be reinstated because the company was no longer operating. The Supreme Court stipulated that, in these cases, the employee must expressly ask for the employment relationship to be terminated.

4. interim employees ENTITLED TO severance payment for THE termination OF THEIR EMPLOYMENT CONTRACT

The High Court of Justice of Madrid used the same arguments as the Court of Justice of the EU in the preliminary ruling the Madrid court sought in the de Diego Porras case. It concluded that an interim employee could not be discriminated against in relation to the severance payment she was entitled to upon the termination of her employment contract. Thus, the employee had a right to receive the severance payment that would have been owed to a comparable employee with a permanent contract terminated on objective grounds: that is, a severance payment of 20 days’ salary per year of service.

5. severance payment of 20 days’ salary per year for the valid termination of a temporary work or service contract: THE application of EU CASE LAW to other employment contracts

Basing its decision on the recent EU case law on interim employees, the High Court of Justice of the Basque Country affirmed that where an employee with a temporary work or service contract is in a comparable situation to that of a permanent employee within the company, the temporary employee is entitled to the same severance payment that would be paid to the permanent employee upon the termination of his/her contract on production grounds. As a consequence, the Court raised the claimant’s severance payment from 12 days’ salary per year of service to 20 days’ salary per year of service.

6. unfair dismissal: objective dismissal wheN the STATUTORY severance payment is not MADE AVAILABLE TO THE EMPLOYEE UPON DELIVERY OF the DISMISSAL letter

The High Court of Justice of Madrid held an objective dismissal unfair because the company ordered the funds for the severance payment be transferred on the date the dismissal letter was delivered to the employee. The dismissed employee was entitled to the payment on that date but could not access the funds when the letter was delivered as they were still in the company’s bank possession.

7. dismissal NULL ON THE BASIS THAT extractS from THE EMPLOYEE’S personal EMAILS WERE THE GROUNDS FOR the termination

The High Court of Justice of Madrid declared a dismissal null where the dismissal letter transcribed emails from the employee’s personal email account, located on a temporary file in the company’s computer. The Court considered that the company violated the employee’s fundamental rights to personal privacy and secrecy of communications. The fact the gathered evidence was null meant for this Court that the dismissal was also null.

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