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Additional/dissuasive compensation vs. legally assessed compensation

In previous posts we have explained How is compensation calculated for dismissal inappropriate, a mathematical calculation in which three parameters are basically taken into account: the worker's salary, seniority and days of compensation (33 days), all of this as indicated in the status of workers.

The right of option that the employer has when the dismissal is classified as unfair is one of the most reviewed and scrutinized institutions of our labor system, having been ratified on many occasions by both the Supreme Court and the Constitutional Court.

With these objective data, any subject (company, worker, judge, labor inspection, etc.) can quantify the corresponding compensation. This form of calculation allows us to assume risks and scenarios based on said information.

Change of criteria: new paradigm

Currently there is a judicial current in which an interpretation of European regulations, among others, JS 26 of Barcelona and JS 3 of Granollersm, and of the Social Chambers of the TSJ of Catalonia, Navarra or Castilla y León; have admitted the possibility, on an exceptional basis, of applying the compensation provision of art. 56 of the Workers' Statute and set compensations higher than those legally assessed, in application of art. 10 of ILO Convention 158 Convention on the termination of the employment relationship where in its literal wording it states:

“If the bodies referred to in Article 8 of this Convention conclude that the termination of the employment relationship is unjustified and if under national law and practice they are not entitled or do not consider it possible in the circumstances, annul the termination and eventually order or propose the reinstatement of the worker, They will have the power to order the payment of adequate compensation or other relief that they consider appropriate..”

Dismissal Compensation (2)

Or article 24 of the European Social Charter, where in its literal wording it states:

“To guarantee the effective exercise of workers' right to protection in the event of dismissal, the Parties undertake to recognize: the right of all workers not to be dismissed without valid reasons for doing so related to their skills or conduct, or based on the needs of the operation of the company, establishment or service; the right of workers dismissed without valid reason to adequate compensation or other appropriate relief…»

That is, this current opens the possibility to set more compensation suitable than the legally assessed one in certain cases. Taking into account the above, we could establish the following as requirements for setting higher compensation:

  • Existence of illegality, fraud of law or abuse of the right of extinction.
  • Insufficiency of compensation because it is meager.
  • Proof of insufficiency (seniority or salary)
  • Invocation in the lawsuit and accreditation in trial.

On the contrary, there is another judicial current in which an express rejection of such complementary, additional or complementary compensation is expressed, such as that expressed in the Social rulings of the TSJ of Galicia or Madrid.

Without a doubt, the debate is served.

Dismissal Compensation (1)

But what has happened now that can change this entire paradigm?

In parallel with these national judicial decisions; The European Social Charter, ratified by Spain in 2021, includes in its article 24 the possibility of compensation superior different from the legally assessed one, and in this context the European Committee of Social Rights has issued various resolutions in Finland (2016), Italy (2019) and recently in France (2022), where it is aligned with the possibility of obtaining compensation or other appropriate/adequate repair.

And all this, to understand the importance of the fact that the complaint presented by the union UGT before the European Committee of Social Rights (CEDS) has recently been admitted for processing and to assess whether Spain contravenes the European Social Charter. This will lead the legislative branch to resolve this situation if Spain is condemned for the claim filed by UGT before the CEDS.

Admission to processing only deepens the possibility that A court could set dissuasive compensation, additional or complementary to that legally assessed for unfair dismissal., and that finally we must assess other parameters, in my opinion, arbitrary, to calibrate/measure the possible risk in case of inadmissibility.

If you like these topics, and want to learn and learn more about this matter, request information and sign up for our Master in HR: People Management, Talent Development and Labor Management.

Labor Manager || Professor - Work area in EIP - International Graduate School

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