There is no general right to employee board-level representation in Spain. Although the draft legislation to implement the directive led to some debate among experts and was considered in detail by the Economic and Social Council, on which both employers and unions are represented, there was no wider public debate.
For further information on the SE legislation, such as the choice of SNB members, click on the more button.
There is no general right to employee board-level representation in Spain in either the public or the private sector. There are a small number of union representatives on the boards of some public and recently privatised companies and employees also have rights to be represented in local savings banks. However, these are very much the exceptions and Spain has no tradition of employee involvement at board level.
Work on transposing the directive began before the change of government in Spain in March 2004 and by July 2004 an initial draft of the necessary legislation had already been prepared. For more details see report from Armando Fernandez Steinko (Universidad Complutense de Madrid) September 2004. This draft was presented to unions and employers in September 2004 and was subsequently discussed in Spain's Economic and Social Council (CES) which brings together representatives of the unions, employers and other groups, such as farmers and consumers. The CES presented its opinion in May 2005, which was approved by 31 votes to two, with six abstentions. A draft bill was approved by the government in November 2005 and presented to the Spanish parliament. It finally completed all its parliamentary stages in October 2006. The long delay meant that the legislation finally passed also transposed the directive on employee involvement in European cooperative societies.
During the long period before it was finally passed, there was some expert debate about the proposal, with the unions considering whether it could lead to a more participative culture in Spanish companies, while the employers were hostile to any limitation on their right to manage. However, there was no widespread public debate.
Form of transposition
Directive was transposed by law in October 2006, two years after the October 2004 deadline.
The directive on employee involvement in European companies was transposed through legislation passed on 18 October 2006. The same legislation also covered employee involvement in European cooperative societies. Its full title is Law 31/2006, of 18 October, on the involvement of workers in European limited companies and European cooperatives ( Ley 31/2006, de 18 de octubre, sobre implicación de los trabajadores en las sociedades anónimas y cooperativas europeas ).
There was separate legislation making the changes necessary to adapt Spanish company legislation to the Regulation on European companies. It came into effect on 1 November 2004.
Special negotiating body (SNB)
Selection of national members
Spanish SNB members for a European company are chosen by the unions which have a majority on the works council or, in smaller companies, among the employee delegates. Overall the number of SNB members per union should be in proportion to the support each union received in the works council elections.
The legislation deals with the choice of both Spanish SNB members and Spanish members of the SE representative body in the same article. In both cases they are to be chosen by the unions that have a majority on the works council or works councils of the companies involved. In companies with fewer than 50 employees, where the duties of the works council are carried out by "employee delegates", it is the unions with a majority of these delegates who make the choice. The selection is made either through agreement of the unions or by a majority of the members of the works council/s and/or employee delegates themselves. In any case the selection of members should be in proportion to the representation obtained by each union in the works council and employee delegate elections for the entirety of the workplaces covered (Article 29).
The legislation makes no provision for what happens if there are no works council/s or employee delegates.
External trade union representatives
External union representatives are specifically permitted to be members of the SNB.
The legislation specifically states that Spanish employees may be represented on the SNB by an external union representative. However, he or she must be a member of one of the "most representative unions" at national level — a status which depends on winning at least 10% of the seats in works council elections across the country —or be a member of a union which is "representative" at company level, that is one which has at least 10% of the seats on the company works council/s, or among the company's employee delegates (Article 29). Only two union confederations, CCOO and UGT, are "most representative" unions at national level.
Financing of experts
Funding limited to "at least one expert".
The companies involved must bear the costs of the SNB. They are required "provide it with the material and financial resources sufficient for it to carry out its functions adequately". This includes the costs of "at least one expert", although there is no limit on the number of experts the SNB can ask to help it in carrying out its duties (Article 9).
Spanish members of the SNB are also entitled to 60 hours paid time off a year in order to carry out their functions. This is in addition to time off to attend meetings, and any other time-off rights they may have in respect of their national positions, for example as national works council members (Article 31).
Standard rules under the fallback procedure
Allocation of national seats on SE representative body
Spanish members of the SE representative body are chosen by the unions which have a majority on the works council or, in smaller companies, among the employee delegates. Overall the number of members per union should be in proportion to the support each union received in the works council elections.
Spanish members of the SE representative body, known in the legislation as the representative body of the workers ( ó rgano de representació n de los trabajadores) are chosen by the unions that have a majority on the works council or works councils of the companies involved. In companies with fewer than 50 employees, where the duties of the works council are carried out by "employee delegates", it is the unions with a majority of these delegates who make the choice. The selection is made either through agreement of the unions or by a majority of the members of the works council/s and/or employee delegates themselves. In any case the selection of members should be in proportion to the representation obtained by each union in the works council and employee delegate elections for the entirety of the workplaces covered.
The Article dealing with the representative body also deals with Spanish membership of the SNB, and the arrangements are largely the same. However, while SNB members can be either employees or external union representatives, Spanish representative body members must be employees. They must also be one of the existing employee representatives – either as a works council member, an employee delegates or a trade union delegate (Article 29). Trade union delegates are only found in workplaces with more than 250 employees, where members of each union which has seats on the works council have a legal right to elect a trade union delegate.
The legislation makes no provision for what happens if there are no works council/s or employee delegates.
Budget of representative body
The company should bear the costs of the representative body, including "at least one expert advisor "for a given area".
The legislation states that the European company must bear the costs of the representative body, and it specifically refers to "the costs of interpretation, subsistence, accommodation and travel" for its members. In addition, it states that the company must cover the costs of "at least one expert", although there is no limit on the number of experts the representative body can ask to help it in carrying out its duties (Article 18).
Spanish members of the representative body are also entitled to 60 hours paid time off a year in order to carry out their functions. This is in addition to time off to attend meetings, their right to paid time off for training, and any other time-off rights they may have in respect of their national positions, for example as national works council members (Article 31).
Spanish employee representatives at board level also have the right to 60 hours a year paid time off (Article 31).
National procedure for the allocation of board seats
Employee representatives at board level from Spain are chosen in the same way as SNB and representative body members – by the unions.
The legislation states that board members who represent Spanish employees in a European company are chosen in the same way as Spanish SNB members and Spanish members of the representative body (Article 30). This means that they are chosen by the unions that have a majority on the works council or works councils (among the employee delegates in smaller companies). The members chosen should be in proportion to the representation obtained by each union in the works council and employee delegate elections for the entirety of the workplaces covered. (See section on national seats on the SE representative body for further details.) The legislation does not spell out whether only employees can be chosen as board level representatives.
Misuse of procedures and structural change
Misuse of procedures
Misuse of procedures – to deprive employees of their rights to involvement –should lead to a renegotiation of the agreement.
The Spanish legislation states that, where an SE is set up with the aim of depriving employees of their right to be involved or damaging these rights, the agreement should be renegotiated. The same applies when there are substantial changes after an SE has been set up which indicate the same aim. However, a court must decide that this was the case before there can be new negotiations (Article 26).
Structural change
Other than where a court has found that there was an intention to misuse the procedures, there is no requirement in the Spanish legislation to renegotiate the agreement if there has been structural change.
The only circumstances in which structural changes will inevitably lead to renegotiation is where a court decides that these changes show that the intention in setting up the SE in its original form was to deprive employees of their rights (see section on misuse of procedures). In other circumstances there is no requirement for the agreement to be renegotiated.
Position of trade unions and employers
The differing positions of unions and employers emerged in the discussions on the legislation in the economic and social council (CES). The key areas of disagreement were whether external union representatives should have a role, the payment of experts, the treatment of confidential information and the time off and training rights of those representing employees.
Draft legislation was submitted to the economic and social council (CES), on which both unions and employers' associations are represented. The CES opinion, published on 18 May 2005, identified four main areas of disagreement between the unions and the employers.
On the possibility of involving external union representatives as members of the SNB or representative body, the employers thought that this should be opposed at all costs, as it was foreign to the Spanish system of industrial relations; the unions, on the other hand, considered that this was an arrangement which was found in other EU states and which should also be considered for the representative body. On the financing of experts, there was a difference between the two sides on the level of support which the companies should pay for. On confidential information, the employers wanted to extend the circumstances in which information could be withheld from employee representatives and not limit it to "exceptional circumstances". On paid time off and training, the employers considered that the amount proposed was excessive and that training should be included within the 60 hours the legislation proposed; the unions welcomed the right to separate time off for training, which they considered should be specialised and appropriate to the tasks the representatives were being asked to perform.