The loss of authorization to work in Spain when the foreign worker himself has not diligently managed the renewal of the work permit, empowers the employer to terminate the employment contract that was initially entered into in a regular manner.
The administrative authorization required for a foreign national to work legally in Spain, while not a requirement for the validity of the employment contract, is essential for its continued existence. In other words, it is a fundamental requirement for the validity of the employment contract, meaning that the subsequent lack of this authorization entitles the employer to terminate the contract as soon as they become aware of it, pursuant to Article 49, paragraph 1, letter b, of the Workers' Statute, which states: “The employment contract shall be terminated (…) for the reasons validly stipulated in the contract unless these constitute a manifest abuse of rights by the employer.”
Case law has held that even if the parties have not expressly stipulated in the employment contract that the loss of authorization to work constitutes a cause for its termination, as a resolutory condition, it does not mean that it cannot be alleged as a just cause for its termination, nor can it be considered that it is a cause of supervening ineptitude that would force the employer to terminate the contract by way of objective dismissal with the consequent obligation to pay the legal compensation, when it has been the worker himself who through negligence has not managed his administrative situation properly, and may even have deliberately caused it in order to receive the aforementioned compensation.
The basis of this jurisprudential interpretation lies in the civil doctrine of the rebus sic stantibus (things being as they are) which refers to a general principle of Law according to which it is understood that the stipulations established in contracts are so taking into account the circumstances concurrent at the time of their celebration, so that certain exceptions to the principle of binding force of the contract (pacta sunt servanda) are admitted, among which is included the possibility of requesting the termination, suspension or review of contracts of periodic or successive performance, such as the employment contract, by virtue of events subsequent to the conclusion of the contract and which could not be foreseen and when doing so would be extremely onerous for one of the parties. Applying this doctrine, it can be stated that the subsequent loss of a work permit due to the worker's own negligence constitutes an unforeseen event occurring after the conclusion of the employment contract. This event alters the initial circumstances, making the contract excessively burdensome for the employer due to the potential penalties that could arise from employing a foreign worker in an irregular situation. In such a case, the employment relationship, which was maintained under lawful conditions until the loss of the administrative authorization to work, has ipso jure a situation of manifest illegality. The employer must not tolerate this situation under penalty of violating immigration law, which would constitute a very serious offense expressly classified as such in Article 37, paragraph 1, of the Law on Infringements and Sanctions in the Social Order, for employing foreign workers without having previously obtained the required work permit or its renewal.
The aforementioned jurisprudential interpretation is also supported by the theory of the basis of the contract, which recognizes the right to terminate a contract due to a change in the circumstances without which the contract would not have been entered into. Applying this theory, it can be affirmed that the administrative authorization required of a foreign national to work legally in Spain is an essential requirement for the validity of the employment contract and, therefore, forms part of the basis of the contract. This means that the loss of this authorization allows the other party, who acted in good faith, to terminate the employment contract from the moment they became aware of it. It is evident that both the employee and the employer entered into the employment contract on the tacit or implicit condition that its effectiveness depended on the employee fulfilling this requirement (being in a legal situation) throughout its term. Consequently, the failure to meet this requirement as a resolutory condition allows the company to terminate the employment contract pursuant to Article 49, paragraph 1, letter b, of the Workers' Statute.
Indeed, in accordance with Article 36, paragraph 3, of Law 4/2000 of January 11, on the Rights and Freedoms of Foreigners in Spain and their Social Integration, neither the lack of administrative authorization nor its loss invalidates the employment contract. This extends to equating a foreign worker in an irregular situation with any other worker, whether legally registered or a Spanish national. However, this equivalence granted by the aforementioned legal provision is limited to the effects of the employment contract generated up to the moment of its termination, without the possibility of extending them beyond its term. This serves as a mechanism to protect such workers from employers who act without regard for the law, and does not apply to all rights arising from the employment contract. Thus, this protection does not extend to unemployment benefits for foreign workers in an irregular situation, given that our Social Security system only covers foreigners in a legal situation (Article 7.1 of the General Social Security Law). And there are many other examples in our legal system of differentiated treatment, such as in relation to the effects of the unfair dismissal of an irregular foreign worker, in which case the employer loses the right of option between readmission and termination with compensation.
In short, without questioning the validity of the employment contract or the rights of the undocumented foreign worker, it is in no way permissible to force an employer to keep a worker in that situation when the lack of authorization arises after the employment contract has been validly entered into. Nor would it be lawful to force a company to bear the consequences of, for example, an administrative penalty, or to compel companies to resort to disciplinary dismissal simply because the legislator failed to include the subsequent lack of a residence and work permit among the grounds for termination beyond the employer's control.
Martí Milán Romera,
Labor Law Area
Àmbit Assesor
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A Àmbit Assessor, SL has 40 years dedicated to the tax, comptable and labor consultancy of the Pime.
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