Paid leaves, work-life balance and salary

Spanish courts have recently ruled on two major issues regarding paid leaves governed by article 37(3) of the Workers’ Statute: (i) how to calculate the remuneration during paid leave and (ii) if the parental leave provided in collective agreements is compatible with the temporary suspension of works contracts (“leave”) for newborn children.

The Supreme Court’s Labor Chamber (Judgment no. 815/2019 of December 3) found that, during certain paid leaves, companies cannot exclude productivity bonuses (in the disputed case, a productivity bonus excluded under the collective agreement) if the paid leave is mostly enjoyed by women. This judgment refers to sick leaves, hospital leaves (except for leaves for death in family) and prenatal care leaves.

In contrast, excluding bonuses, and thus lowering salaries, while enjoying the remaining leaves or entitlements set out in article 37 of the Workers’ Statute (marriage leave, leave for death in family, moving leave, excused absence for voting, jury duty leave or trade union leave) would not be contrary to the principle of equality and the right to work-life balance because these entitlements are “objectively gender neutral.”

The judgment has been delivered by the Chamber in full except for one dissenting opinion. Therefore, lower courts should take it into account when ruling on similar cases.

Royal Decree-Law 6/2019 repealed the newborn leave (2 days extendable to 4) provided in article 37(3)(b) of the Workers’ Statute on the grounds that collective agreements enhanced this statutory entitlement. However, the Court of Appeal’s Labor Chamber (Judgment no. 140/2019 of November 29) still found that the collective agreement’s regulation on newborn leave enhancing the prior legal provisions remains applicable (in this specific case, a leave of 4 business days extendable to 6 in case of travel). The Court of Appeal added that the leave may be enjoyed after the end of the contract suspension (which in 2020 lasts 12 weeks for any parent other than the mother) if the relevant collective agreement does not specify the date from which to enjoy the leave.

This stance contrasts with other courts’ criterion (like the Country Basque Regional Court’s in its judgment of July 16, 2019). Therefore, we expect a Supreme Court decision settling the issue and providing legal certainty to companies.