Spain: the new Spanish Labour Procedure Act 36/2011

The New Spanish Labour Procedure Act 36/2011, (recently approved on 10 October 2011) entered into force on 11 December 2011, and implements significant changes in relation to the jurisdiction of the Labour Courts and cases and proceedings that they have the authority to hear.

This reform is likely to affect the following main areas:

• Centralisation at the Labour Courts
• Strengthening several bodies' entitlement
• New procedures
• Fostering greater access to appeal
• Penalisation of several actions
• Free legal assistance
• Streamlining court proceedings
• Fostering preliminary settlement agreements and arbitration

Centralisation at the Labour Courts

It aims to centralise at the Labour Courts proceedings related to employment, social security, professional accidents and health and safety matters, including when the claimant or person affected is a public employee (except in relation to strike action) or a self-employed worker. This will afford the parties a greater degree of certainty in the context of labour proceedings, but will logically also increase and diversify the type of claims that will be brought before the Labour Courts. Labour Courts are also appointed as the guardians of fundamental rights and freedoms in connection to labour matters.

Strengthening several bodies' entitlement

It aims to strengthen the following bodies' entitlement to act as parties to proceedings (i) the Spanish Salary Guarantee Fund (FOGASA) and collaborating mutual societies; (ii) the trade unions, where they are linked to the proceedings in question or where they have a vested interest in the proceedings; (iii) joint ownership structures and groups that lack their own legal status, when they act as employers.

New procedures

It establishes new procedures (i) to lodge appeals before the Labour Courts against administrative resolutions rendered on labour or social security matters; (ii) for employees to file claims against solvent companies or any Social Security or collaborating entity for amounts of up to €6,000 (new Labour Payment Procedure); (iii) for interested parties to file claims before the Labour Courts against arbitration awards – they must be lodged within 30 days using the ordinary procedure –; (iv) where an employee's conduct constitutes an offence and where authorised by the Court, to convert an unqualified dismissal – which is declared unfair or null and void by the Court – into a lesser disciplinary offence.

Fostering greater access to appeal

It aims to foster greater access to appeal before the Regional Labour Court and the Spanish Supreme Court. In particular, the reasons for appeal are generally made more flexible. The same applies to the requirement to submit contradictory court judgments in order to have access to appeal; under the new provisions, judgments handed down by international courts recognised by Spain may now be taken into account to meet this requirement. Furthermore, contradictory court judgments are no longer required if the appeal is lodged by the Public Prosecutor's Office. This will prove positive for parties when defending their arguments and claims, but may also increase the length of proceedings.

Penalisation of several actions

It penalises actions brought recklessly by parties or with evident lack of good faith. During the proceedings, such actions may merit penalties ranging from €180 to €6,000 and the damaged party may furthermore claim any amounts incurred. If the defendant fails to attend the compulsory preliminary settlement hearing, it will now be obliged to pay the total costs of the procedure, including the claimant's legal fees.

Free legal assistance

Free legal assistance is guaranteed for claimant public employees and trade unions when defending employees' collective interests. The aim is to make court action more accessible to those collectives.

Streamlining court proceedings

It aims to streamline court proceedings, by reducing the length of proceedings as well as the costs incurred by the parties and the courts. This will be achieved by (i) implementing IT systems to enable communication and online access to the proceedings, (ii) joining certain kinds of claims, e.g. dismissal claims and linked monetary claims for outstanding salaries; claims due to professional accidents and claims for related damages, among others.

Fostering preliminary settlement agreements and arbitration

It aims to foster preliminary settlement agreements and arbitration before opening court proceedings. The aim is to discourage parties from resorting to the Labour Courts to resolve disputes.