Montserrat Sole

The role of the constitutional court in Spanish industrial relations

Montserrat Sole Truyols, University of Girona

» Full paper: ilera-2019-paper-141-Sole Truyols.pdf

Spanish industrial relations are marked by under organized unions and a high level of state presence through regulation. In this context, the governments in office – regardless of their ideology – engaged since 2010 in continuous urgency legislation reforms to reduce lay-offs costs and decentralize collective bargaining by setting the prevalence of company level agreements. In 2012 a new urgency legislation was passed which allows employers to opt-out of collective agreements, to modify unilaterally individual working conditions and, to proceed with collective dismissals. All of this on the sole justification that the measure serves to improve business’ results. There is no need for the company to be in economic or market difficulties.

The preamble of the 2012 act (Law 3/2012 of 6th. july, on urgent measures for the reform of the labour market) admits that extending the causes for dismissals or modification of working conditions is necessary in order to avoid uncertainty in employers’ decisions. For that reason, so the law goes on, the judges might only take into account whether the causes exist or not and should refrain to adjudicate considering the proportionality, reasonableness or adequacy of the measure adopted by the employer. Such a limitation of the judicial decision based on competitiveness or economic performance of the company collides with national procedural law on labour matters which establishes the reasoned judgement on the appraisal of the evidences as the legal safeguards for a fair trial. Furthermore, this point of the reform falls outside the constitutional legitimate purposes and creates a problematic situation with regards to the right to an effective legal remedy, protected as a fundamental right in the Spanish Constitution (SC).

This limitation of the judiciary to determine whether just cause exists, was brought to the Constitutional Court for its legality assessment. However, the Court found that the right to legal protection was not violated because the worker is not being prevented to access the justice. The dissenting vote of one of the judges, however, points out that the real problem is whether the trial is fair, and fairness can only be assessed through a motivated resolution. The new law removes motivation; therefore, this provision should have been repealed.

Within the foregoing framework, lower courts in Spain play a minor role as far as industrial relations are concerned. Furthermore, the fact that it is legislation what commands and governs such relations, the Constitutional Court has become the most relevant actor in building the context in which industrial relations in Spain develop. This paper explores the legality concerns brought to the upper court on occasion of the labour reform and the reasoning of the rulings.

Two relevant cases for the purposes of this paper were raised about the constitutional flaws of the 2012 labour reform. The first one challenged two elements of the reform: the employers opt-out of the working conditions collective agreed and the decentralization of the collective bargaining through the legal prevalence of the company agreement, in that both impaired the right to collective bargaining and the right to unionization.

The findings of the Court to dismiss the appeal were grounded on the economic situation of the country and the need to allow the necessary flexibility to the companies to redress their organizational and economic concerns “as it is done in several European countries through the attribution to collective agreements of limited personal applicability” . To this purpose the legislature, in the Court’s opinion, has the power to restrict the scope for collective autonomy if the aim is to secure business competitiveness or if the legislative aim is “to impede that the collective autonomy might frustrate the legitimate objective of creating stable employment” . With that in mind, so the Court’s argument continues, the constitutional protection recognized to labour rights in the past has to yield in the current economic context in favour of the right to freedom of enterprise also constitutionally enshrined in Art. 38 SC . Therefore, the Court inverts its previous jurisprudence on the structure of rights under the SC. The Court had in the past systematically ruled that the right to unionization is a fundamental right while the freedom of enterprise was not fundamental.

Similar arguments have been used in the second relevant case the Court had to deal with. In this occasion the appeal focussed on the change of the legal status of the rights to collective bargaining and unionization. Claimants held that the decentralization of collective bargaining and the possibility of the employers to unilaterally change the working conditions devoid of substance such rights . The Court’s reasoning is based in its previous decision but insists in safeguarding the purpose of the reform as expressed in the preamble of the Act. This is, the economic situation of the country and the need to facilitate employers’ chances to labour flexibility . The judges believe that the legal reform is proportionate and reasonable to the aim pursued by the legislature which is to avoid job destruction. In this ruling, published in 2015 three years after the legal reform was enacted, the Court seems to be unaware that in the year of the reform and subsequent the unemployment rate raised 2% each year.

All in all, the Spanish Court’s rulings have reintroduced into the legal system the managerial prerogatives balanced to economic outcomes, resulting in the transformation of the constitutional protection from persons to economic interests. To a certain degree, these decisions bear a high resemblance to the CJEU’s rulings in Viking and Laval cases in that economic freedoms take a relevant role vis-à-vis of fundamental rights. In terms of methodology it can be argued, however, that the interpretation given in Spain goes even further than that of the CJEU’s since there is no a proper balance among the rights at stake . Whether the Spanish Court has been influenced by the CJEU might be debatable, but it should not be overlooked given the EU’s economic framework influence on the Spanish decision-making process and the conditions of the bailout of the Spanish banking system.

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