Severance pay – Spain
There was currently a controversy in Spain regarding the severance pay that can be granted to employees in the case of dismissal without just cause.
The ordinary Spanish regulations recognize a maximum severance of 33 days of salary per year worked, provided that the dismissal is considered to have been carried out without the formalities required by law or without just cause.
A debate had arisen about the possibility of increasing this severance pay with an additional compensation for damages, based on the ILO Convention. However, the Spanish courts recently rejected this possibility, considering that the severance pay provided by Spanish law complies with the limits established in the aforementioned Convention.
Nevertheless, there is the option of the European Social Charter, which has been ratified by Spain, and the decisions of the European Committee of Social Rights, which consider it necessary to establish severance pay that truly covers the damages suffered by the employee. This is not feasible if a pre-determined severance amount with a defined maximum limit, such as the one provided by the Spanish regulations (Statute of Workers), is simply established.
It is likely that the European Social Charter route will be adopted by Spanish courts in cases of dismissals that involve clear harm.
