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On, June 5, two judgments issued by the Grand Chamber (by the same reporting judge) of the Court of Justice of the European Union (CJEU) were published. In them, the Court endorses the conformity with European Law of a national legislation, such as the Spanish one, which does not establish any compensation for termination of an interim temporary work contract to cover a vacancy (case 677/16, Montero Mateos v Spain) or that establishes a lower compensation (12 instead of 20 days) for termination of a relief contract (case C-574/16, Moreira Gómez vs Grupo Norte), respectively.
We had been waiting for months for the CJEU to settle the pretrial questions submitted by a Madrid Labor Court and by the Labor Chamber of the Galicia High Court of Justice, to clarify the interpretation and scope of the judgment issued by the Court on September 5, 2016 (in the Diego Porras case), which caused great upheaval in legal doctrine and in the courts.
In that case, a lawsuit was filed by an interim temporary (replacement) worker at the Ministry of Defense. The worker had entered several sequential temporary work contracts, all of which were declared lawful by to the Spanish Courts. Finally, after the CJEU judgment, the Madrid High Court of Justice recognized the worker a compensation equal to that of the objective dismissal set forth in section 52 of the Workers’ Statute (20 days’ salary, for a maximum of 12 monthly payments)
There followed many rulings that, at various levels (first instance and appeal) extended the recognition of compensation equal to that of objective dismissal for lawful termination to all kinds of temporary contracts.
However, today, the CJEU held in these two judgments that EU Law does not contradict national legislation:
- that does not provide for any compensation to be paid to workers employed under an interim temporary contract to cover a post temporarily while the selection or promotion procedure to fill the post permanently takes place, such as the temporary replacement contract at issue in the main proceedings; and
- under which the compensation paid to workers employed under temporary contracts to cover working hours no longer covered as a result of a worker taking partial retirement, such as the relief contract at issue in the main proceedings, on expiry of the term for which those contracts were entered into, is lower than the compensation awarded to permanent workers on termination of their employment contract on objective grounds.”
The reasons given by the CJEU radically depart from the position held in the Diego Porras judgment (C-596/14, of September 14, 2016), and they can be summarized as follows:
- Both the termination of a temporary work contract covering a vacancy and the termination of a temporary relief contract take place in contexts that are different from termination of a permanent worker for objective reasons (article 52 of the Spanish Workers Statute).
- From the start of a temporary contract, the parties know that there is a date or event that determines its end, while termination for objective reasons as defined in article 52 Spanish Workers Statute is the result of circumstances that were not expected at the start of the employment relationship.
- Spanish legislation does not distinguish between temporary workers and comparable permanent workers, as compensation for termination on objective grounds defined in article 52 Spanish Workers Statute is the same for temporary and for permanent contracts.
- Finally, the specific purpose of compensation for temporary contracts (article 49 1 c) Spanish Workers Statute) and severance for termination on objective grounds (article 53.1 b) Spanish Workers Statute) justifies the difference in treatment.
We will follow closely the reception of this new legal doctrine by Spanish courts, which will no doubt have to be taken in consideration by companies managing temporary workers.
This post is also available in: Español