Labour Tsunami in Recruitment

26/10/2016

In the social issues, beyond their economical content, certain figures and numbers acquire, in a precise moment, an almost magical inordinate value, as it happened with the 35-hour work week in due course, and it’s happening now after the judgment by the Court of Justice of the European Union last 14th September with the 20-day compensation as a possible remedy for one of the major endemic problems that the Spanish labour market is going through: the rate of temporary employment.

Even if the Government, entrepreneurs and trade unions have already decided to create a work group that will have to make proposals about this issue that will probably result in legislative action, the judgment of 18th October by the Employment Division of the Superior Court of Justice in the Basque Country has already taken the next step to equate the expected compensation for the extinction of permanent contracts for objective causes. Once again, a Public Administration as entrepreneur (without doubt, the best entrepreneur to test new solutions, due to the legal presumption of its universal solvency, nowadays slightly more weakened by the crisis), the formally correct extinction of a temporary employment contract which does not engage in fraud, and a novelty: it is not a provisional contract (like in the case resolved by the Court of Justice of the European Union) for which our legislation did not contemplate any compensation, but a construction or specific service contract which has a 12-day compensation (against 20 days in the permanent contract) recognized in our legislation.

The decree chooses to equalize in the most favorable way (i.e. , in 20 days) considering that when the situation of the female plaintiff worker is similar to that of a permanent worker in the same enterprise, there is not a reasonable and objective justification that allows to apply a different compensation (highlighting that if she had not work in a Public Administration, at the moment of communicating the extinction of the contract, the female worker would have become a permanent worker since the maximum deadline of three years, that the Law points out for this contractual arrangements, would have passed).

That said, it seems to clarify an important issue for the enterprises: in this cases (termination of a temporary contract when the foreseen cause comes to it from its beginning, without fraud) they do not have to send an objective dismissal letter to the worker. The decree does not qualify the dismissal as inappropriate or void, but it just confines to increase the amount of compensation that should be subscribed for a legal termination.

To arrive to this conclusion, it applies the general principle of law of who can do more (unfair dismissal) can do less (to increase the compensation anticipated by the legislator to terminate a legal temporary contract). Nevertheless, the worker did never ask for the last, since it is highlighted that her objective was to get the nullity of the dismissal (“even though she did not defend anything of it in practice”) and collaterally, the irrelevance. Therefore, it is very clear that it was the court that has decided to introduce the argument of discrimination between permanent and temporary workers, this is, the infringement of the fundamental right of equality, to get to that “magic figure” of 20 days. Is there a right to compensation being created “ex novo” by court proceeding?

I think that given the insecurity that is being created, and to prevent a judicial avalanche of claims all over Spain, it will always be preferable the solution arising out of the legislative power, even though its slowness at addressing the problems of the weakest part (the temporary worker) may sometimes activate the law courts, tired of seeing in their disputes the ugliest part (abuse and fraud) of the temporary recruitment. We are in a right moment, with the looming new Government, to be able to regulate sensibly this subject of the working engagement and not let it affect our battered labour market.

Translated by Clara Ayuso