Procedure for substantial modification of working conditions in Spain

In Spain, in the exercise of their duties, employers can agree a procedure for substantial modification of working conditions. However, they will need to prove underlying economical, technical, organizational or productivity reasons.

What are substantial modification of working conditions?

Any change to the following working conditions will be considered substantial or significant:

• Workday
• Schedule and distribution of work hours
• Work shifts
• Salary
• Working system
• Duties of the employee

It is required that the changes alter any fundamental aspect of the labor relationship.

When are changes considered collective?

The modifications will be considered collective when, within a period of 90 days, they affect at least the limits established in the Spanish Law:

• 10 workers in companies with less than 100 workers
• 10% of workers in companies with 100-300 workers
• 30 workers in companies with more than 300 workers.

Procedure for substantial modification of working conditions

The decision of collective substantial modification must be preceded by a series of consultations with the representatives of the employees. According to article 41 of the Estatuto de los Trabajadores (Workers Statutes), the company must adhere to the following steps:

1. First, the directive of the company must properly communicate to the employees or their legal representatives that they plan to initiate a process of substantial modification
2. After this notice, the deadline to constitute the negotiating commission opens, which will be part of the consultation period. The commission will be composed of a maximum of 13 members for each party (the company and the representatives of the employees, respectively)

If there are no representatives of the workers in the company, they may opt to be represented by:

(i) A commission composed by a maximum of 3 members democratically elected, who should be employees of the company.
(ii) A commission with a maximum of 3 members composed by the most representative, autonomous union and the most representative union in the activity sector of the company.

The deadline by which to form the negotiating commission will be of 7 days, or 15 days if the company does not have worker representatives.

3. After the constitution of the negotiating commission, the company will provide notice that the consultation period has begun. During this period, the parties will discuss the causes that led to the company’s decision and negotiate in good faith in order to reach an agreement about the measures required to reduce the effects and consequences. This period cannot exceed 15 days

4. The consultation period can be closed with or without an agreement. The decision must be notified to both individual workers and their representatives. The decision shall take effect 7 days following this notice

6. The decision may be contested in a collective conflict, without prejudice to the individual actions established by the law.

Declaration of nullity of the procedure for substantial modification of working conditions

It is mandatory that the employer follows the procedure established by law and provides the reasons that justify the decision of substantial collective modification. Failure to comply with any of the outlined requirements may cause the procedure to be voided.

In several recent decisions, the Supreme Court voided procedures for substantial collective modification because the acting companies did not provided the information required to the representatives of the employees during the consultation period. (STS June 26th, 2018, rec.83/2017).

Additionally, the Supreme Court has called for the nullity of substantial collective modification in cases where a company failed to notify the decision to the employee’s representative after a period of consultation that closed without agreement, as this interferes with the effective exercise of collective action established in the law (STS March 22nd, 2018; rec.660/2016).

Conclusion

In Spain, the laws and courts demand scrupulous compliance with all the steps established for the procedure for substantial modification of working conditions while also calling for parties to act in good faith in order to reach an agreement.

There lies, in fact, a similarity in all those procedures that affect a collective of workers. This, being true regardless of the subject and object in question, goes for collective dismissal, substantial modification of working conditions or even geographical mobility.

In all of them, the breach of any requirements or acting in bad faith during negotiation will lead to the nullity of the procedure.

For further information regarding the procedure for substantial modification of working conditions in Spain,