Originally published February 2010
Law 27/2009 Of 30 December (Official Spanish Gazette Of 31 December 2009)
On the one hand, this law ratifies certain measures that the Spanish government introduced by Royal Decree-law 2/2009 of 6 March, which will be in force until 31 December 2010. These measures are intended to alleviate the effects the current economic crisis is having in the labour market, particularly to safeguard and protect the unemployed. Among other provisions, the legislation seeks to encourage employers and trade unions to accept the temporary suspension of employees' work contracts rather than adopt more definitive or extreme measures such as collective dismissals.
On the other hand, this law introduces one of the most historically important laws demanded by trade unions. In this regard, its thirteenth additional provision sets out that when an employee is dismissed pursuant to a collective dismissal procedure, with the prior approval of the relevant Labour Authority or on objective grounds, and provided that the dismissal is based on economic, technical, organisational, production or force majeure reasons, the part of the compensation that does not exceed the statutory severance payment for unfair dismissal (i.e., 45 days of salary per year worked with a maximum of 42 monthly payments) is tax free. This modification to the taxation of statutory severance payments will apply as from Royal Decree-Law 2/2009 of 6 March coming into force (8 March 2009).
Royal Decree 2030/2009 Of 30 December 2009 (Official Spanish Gazette Of 31 December 2009)
In Spain, the minimum wage for all types of employment and for national or foreign employees over 18 years of age engaged in full time work is established annually by the Spanish government. For 2010, the minimum guaranteed wage is set at €21.11 per day and €633.20 per month.
REPORTED CASE LAW
Judgment Of The Labour Chamber Of The Supreme Court (SC) Dated 6 October 2009 (Appeal Number 3,012/2008)
By way of background, a company decided to amend the incentive system applicable to its employees after it had held a consultation period with the employee representatives which had finished without agreement. The incentive system's terms and conditions were set out in a company agreement entered into between the employer and the works council.
The SC considered the company's decision to be lawful as companies are able to amend the employees' working conditions without the employee representatives´ agreement, provided that (i) these conditions have not been stipulated in the collective bargaining agreement applicable to the company, and (ii) the consultation period was fully followed by the parties.
Judgment Of The Labour Chamber Of The Supreme Court (SC) Dated 27 October 2009 (Appeal Number 3,672/2007)
In this important decision, the SC has changed its previous case law with regard to the requirements that the employer should fulfil to avoid paying the salary accrued from the date of dismissal to the date of notification of the ruling (the so-called "procedural salary").
According to Spanish legislation, within the 48 hours following the effective dismissal, the employer must recognise the unfairness of the dismissal before the Labour Courts and deposit the legal severance payment in the bank account of the Labour Courts. The new requisite introduced by the SC in this ruling, is that the company, in the said period, must inform the employee of the acknowledgement and the amount deposited.
Judgment Of The Labour Chamber Of The Supreme Court (SC) Dated 3 November 2009 (Appeal Number 134/2008)
In accordance with Article 44 of the Statute of Workers, amended in order to implement Council Directive 2001/23/EC of 12 March 2001, once a transfer of an undertaking is carried out, the working conditions of the employees affected by the transfer shall continue to be governed by the collective bargaining agreement applicable in their former company, unless otherwise agreed by the parties.
Notwithstanding the above, the SC declared that the said general rule does not apply to those employees who joined the company after the effectiveness of the transfer had taken place.
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