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  1. One of the main doubts that has arisen in recent years with regard to workers’ compensation and occupational illness payments has to do with which activities fall under letter “a” of the current Table II on “Accident premium payments” provided by Additional Provision 4 of Spanish Act 42/2006, on the 2007 General State Budget [Ley 42/2006, de Presupuestos Generales del Estado para 2007] (rule three), which replaced the provisions of Spanish Royal Decree 2930/1979.
  2. This letter “a” includes what are known as “exclusive office jobs.” Even though their contribution rate was raised from 1% to 1.5% on January 1, 2019, since it is usually below the rate that should apply according to the National Economic Activities Classification of the primary activity, many companies have tended to include office work under this letter of Table II.
  3. However, in the work performed by the Labor and Social Security Inspectorate, the General Treasury of Social Security has been applying a more restrictive criterion by minimizing which jobs can be included under letter “a.” In its opinion, only exclusively administrative jobs may be included that have workdays performed wholly in offices.  Based on this criterion if, for example, employees have meal allowances that show that they travel or leave the office to perform the specific work of their job, then the administration will reject the possibility of having their payments fall under letter “a,” and instead have the employer make the payments associated with the National Economic Activities Classification of its primary activity, with the obligation to regularize their social security payments by paying the differences of the payments made over the previous four years.
  4. Delimiting this letter “a” has, however, been complex because the legislature had to clarify the wording of the third rule under Additional Provision 4 using the reforms from Spanish Act 48/2015, which in principle do not represent an essential change to the rule, but rather a clarification of it to remove its ambiguity. Yet even this amendment to the regulation did not dispel all of the doubts, mainly because it continued to blunt the fact that the administration ended up linking the payment obligation from professional jobs performed in offices to the danger level of the company’s primary activity, and not to that of these specific jobs. This resulted in higher social security costs for companies, who were left wondering why they have to pay more if their employees’ work has nothing to do with exposing them to the risks of the company’s primary activity.
  5. Following several preliminary rulings, the Judicial Review Chamber of the Supreme Court has just resolved the debate on this issue in its Judgment 762/2019 of June 3, 2019.
  6. In particular, in the case the General Treasury of Social Security followed its restrictive criterion to argue that, in the case of directors, engineers, technicians, managers, heads of work centers, etc. who perform work such as preparing sales budgets, planning purchasing, preparing and directing plans, developing engineering solutions, planning, etc. on an ordinary and regular basis in their company’s office, the workers’ compensation and occupational illness payment rate that should apply should be the rate specified for the company’s primary activity (3.85%) under heading 28 of the National Economic Activities Classification in Table I—the same as for the company’s other employees who work on specific tasks of production, assembly and maintenance—and not the rate under letter “a” for personnel with exclusive office jobs (currently 1.5%) under Table II.
  7. The High Court of Justice of Asturias partially sustained the company’s argument that these employees should fall under letter “a” of Table II.
  8. The General Treasury of Social Security appealed this ruling, but its appeal was dismissed by the Supreme Court, where the Judicial Review Chamber found that “…for this employment in the company’s activity to be included under ‘exclusive office jobs’, the employment must (i) be exclusively in those jobs that may be office jobs; (ii) not subject the employee to the company’s risks; and (iii) be performed solely in locations allocated to the company’s offices.”  According to the chamber, this takes the form of the following classification criteria:
  9. Employees perform exclusive office work if they spend more than half of their workday in the office.
  10. Exclusive office work cannot be reduced to mere administrative work; rather it may match the company’s primary activity (so that, for example, sales staff who work by phone or by computer without hardly ever leaving their office would be categorized as letter “a”). It should be borne in mind that in this regard the Labor and Social Security Inspectorate did not recognize activities that could fall under the company’s corporate purpose as part of its ordinary activities and that are not exclusively administrative as “office jobs” under Table II, and it used this argument to apply the company’s general workers’ compensation and occupational illness payment rate.
  11. The payment rate would be out of step with the effective risk of the employee’s job or situation if the payment rate were to be applied that is specified for the company’s activity in Table I of the premium rates according to the National Economic Activities Classification.
  12. The judgment concludes by clarifying that “the interpretative criterion that we have reached with regard to the paragraph that the amendment added to rule three of subsection two (paragraph two) may be taken into consideration for payment situations from before the amendment and for determining the payment rate for the employee’s job…” and this is because, according to the chamber, “the amendment did not change the “concept” taken into consideration by letter (a) of Table II on payments by job:“personnel in exclusive office jobs,” rather it has only come to specify, by way of authentic interpretation, what should be understood by that “concept” and for the purposes of determining the payment rate for the job.”
  13. The criterion of this judgment has an enormous impact on the General Treasury of Social Security’s revenue expectations, because in addition to opening the door for many companies to bring claims for excess payments, it also threatens to void the content of some of the headings under Table I that refer to activities that, due to their specific characteristics, are performed in offices and generally without leaving them.

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