Collective Bargaining in Spain

Posted on Dec 3, 2024 in Law & Jurisprudence

Collective Bargaining in Spain

Constitutional Principles

Topic: Collective Bargaining

Article 37 of the Spanish Constitution (EC) recognizes the right to collective bargaining between workers’ and employers’ representatives, and the binding force of agreements. While not a fundamental right, it’s integral to freedom of association, offering constitutional protection against certain infringements. Analyzing Article 37.1 EC requires considering:

  • The right to bargain: This doesn’t impose a duty to negotiate, but protects against state interference and promotes the rights of involved parties. Interpretations vary regarding who constitutes a ‘representative’ of workers and employers.
  • Content of possible negotiations: This encompasses all matters related to industrial relations.
  • Binding force of agreements: This can be interpreted as:
    • An implicit duty of peace, upholding pacta sunt servanda (agreements must be kept), preventing strikes during the agreement’s term.
    • A normative effect, where the agreement’s provisions become legally binding.

Collective Agreements and Worker Status

Contracting Parties

Contracting parties are worker and employer representatives with general capacity (initial or intervener standing) and specific legitimacy (negotiating or complementary).

Negotiating Capacity

General Capacity

General capacity or initial legitimacy includes:

  • Workers’ side: Delegate committees, company representatives, union representatives from companies, trade unions, federations, and confederations with full legal capacity.
  • Employers’ side: Employers, business associations, federations, and confederations with full legal capacity.
Specific Legitimacy

Specific negotiating legitimacy or complementary legitimacy is more complex, particularly for supra-company agreements:

  • Workers’ side: Most representative unions at the state and regional levels, their affiliates, and unions with at least 10% of works council members or staff in the relevant geographical and functional area. A union lacking 10% representation can still negotiate if affiliated with a representative union at the state or regional level.
  • Employers’ side: Business associations representing at least 10% of employers in the agreement’s geographical and functional scope, employing an equivalent percentage of affected workers. Case law has relaxed these requirements for the public sector.

For state-level agreements, most representative unions and business associations at the regional level with at least 15% representation are also entitled to negotiate.

Article 88.1 of the Workers’ Statute (ET) requires additional legitimacy for unions and business associations to form a quorate negotiating committee. This requires representing, individually or jointly, at least an absolute majority of works council members and staff representatives (workers’ side) or most employers employing the majority of affected workers (employers’ side).

Excluding an entitled union violates freedom of association (Article 28.1 EC), even if another party holds the required majority. This right is waivable, and post-agreement accession doesn’t change its non-statutory nature.

Company-Level Agreements

Employers’ Legitimacy

Article 88.1 ET grants legitimacy to employers or their representatives. Employers’ associations can also negotiate, but in-house negotiations remain valid even if the association claims exclusive bargaining rights.

Workers’ Legitimacy

Article 87.1 ET grants negotiating rights to:

  • Company staff
  • Delegate committees (acting jointly)
  • Union representatives (if applicable)

The first to initiate negotiations has priority. If initiated by the company, it chooses its negotiating partner.

Group or Sub-Group Agreements

Group agreements affect specific worker groups within a company (e.g., airline pilots).

Affected workers assemble to designate union sections for negotiation. Works councils can also negotiate and delegate representation. For supra-company group agreements, the most representative union negotiates with relevant business associations.

Agreements for Groups of Companies

These agreements apply to companies with similar characteristics within a national, multinational, or governmental financial group.

Employers: Follow the rules for company-level agreements.

Workers: Follow the rules for supra-company agreements.

Control of Contracting Party Representativeness

Trade Union Representation

Public authorities maintain records of trade union elections and issue certifications of representative capacity.

Association Representativeness

Control is more complex due to the lack of elections or certifying bodies. Legitimacy is presumed for those who have negotiated and mutually recognized each other’s negotiating capacity. The burden of proof lies with those who challenge this legitimacy.

Scope of Conventions: Free Choice and Limits

Article 83.1 ET allows parties to determine the personal, functional, and territorial scope of collective agreements. However, limits exist:

  • Nature of things: Bargaining units must be reasonable and appropriate.
  • Legitimacy for negotiating and setting the scope: Parties must have the appropriate representation for the agreement’s scope.
  • Rules on competition between collective agreements: Conflicts and competition are prohibited, except for most representative unions and business associations negotiating agreements affecting them with the required majority backing.
  • Provisions of a framework agreement: This agreement establishes the structure of collective bargaining.

Content of Agreements

Delimiter Clauses

Article 85 ET outlines core content requirements:

  • Identification of contracting parties
  • Personal, functional, territorial, and temporal application
  • Notice of termination
  • Designation of a joint committee and dispute resolution procedures

Supra-company agreements must establish procedures for implementing wage systems, even though this is somewhat contradictory to the binding nature of collective agreements.

Normative Content

The principle of freedom of content is subject to legal limits and respect for minimum rights. Legal provisions may be:

  • Necessary law: Unavailable to the parties
  • Rights on need:
    • Maximum: Unavailable for improvement, but available for reduction
    • Minimum: Available for improvement

Collective agreements must also respect more favorable individual contractual terms.

Obligational Content

These clauses ensure effective agreement implementation by imposing duties and obligations on contracting parties. This includes the duty of peace (Article 82.2 ET), renouncing strikes during the agreement’s term or establishing conflict resolution mechanisms.

Agreements on Specific Issues

Article 83 ET allows most representative unions and business associations to negotiate agreements on specific issues.

Negotiation Process

Initiating Negotiations

Any legitimate party can initiate negotiations by writing to the other party, stating their legitimacy, agreement scope, and negotiation topics. A copy must be sent to the competent labor authority.

Duty to Negotiate

The receiving party must negotiate and take steps to advance negotiations. The duty to negotiate doesn’t imply an obligation to reach an agreement. Reasons for refusal include lack of legitimacy, improper communication, or a prior agreement covering the same area.

Failure to negotiate can result in administrative penalties and potential strikes.

Constituting the Negotiating Committee

The committee must be established within one month of receiving notification. Parties set a negotiation timetable. Representatives are designated by the entitled parties. Once appointed, they cannot be revoked during the agreement’s negotiation. Company-level agreements limit representatives to twelve. Supra-company agreements allow any legitimate union or business association to participate.

Good Faith Negotiation

Article 89.1 ET mandates good faith negotiation, aiming for a serious attempt to reach an agreement. Violence suspends negotiations. Breaching good faith can result in sanctions and legal strikes.

Reaching Agreement

Agreements require a majority vote from each representation (Article 89.3 ET). Interpretations vary on whether this refers to committee members or contracting parties. Assembly endorsements aren’t legally required. Preliminary agreements can be changed until the final agreement.

Breach of Negotiations

The Workers’ Statute is silent on the lack of agreement. A strike may be declared.

Mediation

Parties can agree to mediation (Article 89.4 ET), resulting in a legally binding agreement if successful.

Written Form

Article 90.1 ET requires written agreements signed by negotiating parties.

Administrative Procedures

Agreements are registered with the labor authority within fifteen days of signing. They are then registered with the SMAC (Service of Mediation, Arbitration, and Conciliation) and published in the Official Gazette within ten days of registration.

Administrative Failure

Failure to publish renders the agreement inapplicable. Breaches by the labor authority are subject to legal accountability.

Collective Bargaining (II)

Challenging Collective Agreements

Causes, Timing, and Procedure

Labor authorities can challenge agreements violating laws (illegality) or harming third parties (harmfulness) in court via a special procedure (Articles 161-164 of the LPL, Article 90.5 ET).

Illegality: Formal (non-compliance with the ET, bad faith, lack of legitimacy) or substantive (violating required laws).

Harmfulness: Damage to third parties outside the agreement’s scope.

Challenges must be made before registration; afterward, only collective conflict procedures apply.

The procedure involves the labor authority, potentially the State Attorney, and the prosecution. Rulings are issued within three days and are immediately enforceable.

Collective Conflict Process

Collective conflict procedures can challenge agreements before or after registration:

  • Before registration: If the labor authority doesn’t respond within 15 days.
  • After registration: Via the collective conflict procedure.

Right of action:

  • Illegality: Representatives of workers and business associations, and anyone directly affected, except the agreement’s parties if a union holds unitary representation.
  • Harmfulness: Third parties, excluding workers, employers, or retirees covered by the agreement.
Effects of Challenging an Agreement

Courts can declare total or partial nullity or suspend the agreement. Agreements with indivisible clauses may result in total nullity if any clause is illegal or harmful. However, courts can annul specific clauses without affecting the entire agreement. Nullity is publicized as the original agreement’s entry into force.

Individual Challenges

Workers can challenge clauses via regular procedures, invoking the right to effective judicial protection (Article 24.1 EC).

Legal Effect of Collective Agreements

Legal Effectiveness Standards

Articles 82.3 and 3.3 ET recognize collective agreements’ legally binding nature. This implies:

  • Mandatory application to individual labor relations, subject to more favorable conditions.
  • Principle of modernity: Later agreements supersede earlier ones.
  • Principle of publicity: Agreements must be published.
  • Individual responsibility for breaches.
  • Appeals for legal violations, not factual errors.

The law allows modifying certain aspects of collective agreements:

  • Wage systems (at least annually)
  • Substantial changes to working conditions (Article 41.2 ET) due to economic, technical, organizational, or production reasons.
Duty of Peace

Strikes aiming to alter an agreement during its validity are illegal, unless explicitly allowed.

Personal Effectiveness

Article 82.3 ET recognizes the general effectiveness (erga omnes) of collective agreements, binding all employers and employees within its scope. Jurisprudence confirms this, prohibiting individual contracts contradicting collective agreements.

Changes in representative bodies don’t affect the agreement’s applicability, as legitimacy is assessed only initially.

Duration of Collective Agreements

Duration and Entry into Force

Duration is freely determined by the parties (Article 86.1 ET). The entry into force date can be set before negotiation completion or publication, allowing retroactivity.

Termination

Formal denouncement is required. Without denouncement, agreements extend annually (Article 86.2 ET), unless otherwise agreed.

Only parties with full legitimacy can denounce an agreement.

Article 86.3 ET

Denouncement ends the obligational force. Normative content remains valid until the agreed period or indefinitely if no new agreement is reached.

Later agreements supersede earlier ones unless specific aspects are preserved (Articles 86.4 and 82.4 ET).

Application and Interpretation of Agreements

Judicial Enforcement

Article 91 ET states that courts resolve conflicts arising from the application and interpretation of collective agreements. This is not a literal interpretation but must be consistent with the specific conflict.

Joint Commissions

Joint commissions can interpret agreements but cannot modify their text. Their decisions aren’t legally binding, but their interpretations are relevant.

Judicial proceedings aren’t precluded by joint commission interpretations.

Judicial Procedures for Resolving Conflicts

Article 91 ET allows for mediation and arbitration if agreed upon. Agreements reached via these methods have the same legal effect as collective agreements, provided the parties meet the requirements for standing.

General Rules of Interpretation

Interpretation methods include:

  • Literal interpretation
  • Systematic interpretation
  • Historical interpretation
  • Teleological interpretation

Membership and Extension of Collective Agreements

Accession

Article 92.1 ET allows parties to join an existing collective agreement if they meet certain requirements:

  • Agreement of entitled parties
  • Homogeneity within the bargaining unit
  • Agreement in force
  • No other agreement affecting the unit
  • Communication to the labor authority
Extension

Article 92.2 ET allows the Ministry of Labour or regional authorities to extend an agreement’s provisions to other enterprises, workers, or sectors. This requires similar functional or economic characteristics (RD 572/1982). The initiative is by request, with reports from a joint committee and the National Commission on Collective Agreements. Extension only applies to normative content, not obligational content.

Enterprise Agreements Substituting Statutory Collective Bargaining

The Workers’ Statute allows enterprise agreements to substitute for collective bargaining in six cases:

  • Job classification
  • Promotion schemes
  • Wage payment proof
  • Irregular working hours distribution
  • Regular working hours
  • Workforce reduction representation

These agreements are informal and alternative to collective agreements. They have legal force within the company. Only works councils or staff representatives, and unions representing a majority of committee members, can negotiate them.

Extra-Statutory Collective Agreements

These agreements are grounded in the Constitution (Articles 7, 28.1, and 37.1 EC) and implied in the ET (Articles 82.3 and 90.1). They are not governed by the Workers’ Statute but by the Constitution, the parties’ will, and general civil code rules.

Original extra-statutory negotiation: Occurs when statutory requirements aren’t met (lack of legitimate representatives, insufficient representation, exclusion of unions, lack of majority agreement, or by party will).

Derived extra-statutory negotiation: Occurs when a statutory agreement is declared invalid.

The legal effect is debated, with some arguing for regulatory effectiveness and others for contractual effectiveness. Judicial doctrine affirms contractual effectiveness, but applies principles of regulatory effectiveness in some cases.

Contractual consequences include individual rights between contracting parties, contractual responsibility for breaches, and no appeals for legal violations.

Effectiveness is limited to represented workers and employers. Non-signatory acceptance can be explicit or tacit (implementation without protest). Employers often use individual accessions to avoid problems. Discriminating against non-union members is prohibited.

Case law limits the content of extra-statutory agreements, voiding unenforceable clauses requiring individualized application to all employees.

There’s no obligation to negotiate extra-statutory agreements.

Negotiation procedure: No legal regulation exists. There’s no official publication or challenge by labor authorities, but challenges are possible via collective dispute procedures.

Extra-statutory agreements can be used to circumvent employer opposition to union bargaining. However, the statutory duty to bargain and the obligation to negotiate in good faith offer indirect means to combat this.