Regulation and interpretation of a collective dismissal according to European Law
European Directive 98/59/EC regulates collective dismissals and defines them as dismissals by an employer for one or more reasons not related to the individual workers, where the number of dismissed employees is at least 20, for a period of 90 days, regardless of the number of workers normally employed in the workplace in question.
In the first judgment from 30 April 2015, the Court of Justice of the European Union delivers an interpretation of the term workplace which appeared in the European definition of collective dismissal. The judgment states that where a company comprises of several workplaces, the term workplace must be interpreted as the entity where the dismissed workers are assigned to carry out their duties.
The case of the Spanish legislation
In Spain, Art. 51 of the Worker´s Statute regulates the concept of collective dismissal. The article maintains the definition of the European Directive, even though the Spanish legislation takes as a reference unit the company and not the workplace.
In this way, in the judgment of the European Court of Justice (ECJ), the use and content of the term workplace arise when the company comprises of several entities.
Based on the previous judgment the solution proposed by the European courts was the following: the workplace for the purposes of the Directive is the entity to which the dismissed workers are assigned to carry out their duties. However, as a company may comprise of several workplaces, the number of dismissals effected at each workplace of the same company must be taken into account.
The difficulty in differentiating between the concepts of a company and a workplace could preclude the information and consultation procedure established in the Directive when a collective dismissal arises. The future change in the Spanish legislation will probably increase the number of dismissals considered as collective dismissals, causing a longer and more formalistic procedure for companies.
One final consideration in classifying collective dismissals
One final issue that the judgment of 13 May 2015 clarified is related to contracts concluded for limited periods of time or for specific tasks. These contracts are excluded from the scope of application of the Directive on collective dismissals since these terminate not on the initiative of the employer, but pursuant to their contractual provisions.
This article is not considered as legal advice