Employment - Legislative and case law developments
16 January 2025
1. Basic Law 1/2025 introduces key amendments to the Law Regulating the Labour Courts and to the Statute of Workers
The amendments aim to streamline legal processes and give workers more protection. Among other provisions, Basic Law 1/2025 clarifies the grounds under which an employee can request to terminate their employment contract when an employer fails to pay their wages, and rectifies the error in Basic Law 2/2024 of 1 August on equal representation and gender balance.
2. Disability allowances will be suspended when individuals take up work that results in their inclusion in the social security system
Law 7/2024 modifies article 198 of the General Social Security Law by stipulating that allowances for absolute permanent or severe disabilities will be suspended during the period in which individuals undertake work, provided the work leads to their inclusion in a social security scheme.
3. Law 6/2024 introduces a new short-term disability and paid leave for live organ or tissue donation
Law 6/2024 amends the General Social Security Law and the Statute of Workers to include a new short-term disability leave for organ or tissue donation. It also establishes paid leave for donors to attend pre-op appointments and carry out any other related steps.
4. Provisional pension rate changes and transitional rules on contributions until the approval of 2025 General State Budget Law
Royal Decree-Law 9/2024 will provisionally regulate pension rate changes until the General State Budget Law for 2025 is approved. It also establishes transitional rules on contributions such as determining the Intergenerational Equity Mechanism contribution and minimum contribution base increases.
5. Amendments to regulations on active and partial retirement
Royal Decree-Law 11/2004 introduces amendments to the General Social Security Law and the Statute of Workers for the purpose of encouraging continued participation in the workforce and to allow workers to leave the labour market in a more gradual and flexible manner upon reaching retirement age.
6. New order declaring the activation of the RED Mechanism for the motor vehicle manufacturing sector in 2025
Order PJC/1472/2024 of 26 December allows motor vehicle manufacturing companies that meet the established requirements to reduce working hours or suspend employment contracts under the mechanism for employment stability and flexibility – known as the “RED Mechanism”.
7. Recording working hours is also mandatory in the domestic workers sector
The Court of Justice of the European Union has held that a national law exempting employers from the obligation to implement a system to record the working hours of domestic workers clearly violates EU law, specifically Directive 2003/88 and the Charter of Fundamental Rights of the European Union.
8. Compensation for unfair dismissal established in the Statute of Workers cannot be increased via judicial means
The Supreme Court has ruled that the compensation established in article 56 of the Statute of Workers cannot be increased via judicial means based on the specific circumstances of the case, and that this does not violate article 10 of ILO Convention No. 158.
9. Travel time between a worker’s home and the premises of their first and last customers does not count as working time
The Supreme Court has held that travel time between a worker’s home and the premises of their first and last customers does not count as working time, unless specific circumstances apply.