Objective Dismissals in Spain: Dismissal for Organizational Reasons

The Spanish Labour Legislation contains a number of grounds for objective dismissal, and among these is the category of dismissals for economic, organizational, technical, and production reasons. These reasons are the same as the Spanish Legislation granted for collective redundancies, differing only in the number of workers affected by the termination of their employment contracts. This number must be less than the threshold of dismissals that determines the application of the regulations of collective dismissals.

This informative article discusses the circumstances of an organizational nature that justify the start of the objective dismissal of a worker without addressing other equally important aspects such as requirements that are subject to this type of dismissal (mainly written communication and compensation) or criteria that may limit the selection of workers affected by the measure.

Definition

Organizational causes arise when changes occur in the organization of the company, its systems, its methods of work, or its method of generating output so that one or more excess posts within the new structure generate.

Cases that the Law Recognises

The Law contemplates that the above changes include the following cases:

  • Rearrangements of departments to establish the best use of resources without creating an increase in the workload for the remaining workers
  • Closure of branches for changes in the services customers demand and the loss of contracts that justify the existence of this branch or the closure of the workplace itself
  • Readjustment to the distribution networks of companies after the merger of them
  • Centralization of departments of the company to the detriment of their regional branches
  • Substantial changes in management

Additionally, the Law appreciates the occurrence of organizational causes in situations that are not organizational changes of the company, its systems, its methods of work, or its method of generating output but instead generate an oversized workforce or the duplication of workers.

Conclusion

Given the general nature of the terms set forth in the Law, it is essential to analyze each individual case to determine the legal perception of it, accurate presentation, and the presence of other possible causes of dismissal for objective reasons that the communication of the dismissal of an employee may include. Any claim or circumstance not included in the letter of dismissal cannot be invoked in any potential subsequent court proceedings. Considering this reality, the wording of this communication is of vital importance.

This article is not considered as legal advice

Nicolás Melchior

A Law graduate from the Universidad Carlo III de Madrid, Nicolás Melchior specialises in corporate Law, commercial contracts and electronic commerce. Working languages: Spanish, German, English and French. For any further enquiries please Contact us

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