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Labor, 19/09/17

Scope of company collective agreements.


Can it prevail over a sectoral collective agreement? Analysis of the Supreme Court ruling (Social Chamber, Section 1) no. 772/2016 of September 22.

As a result of Royal Decree Law 3/2012, on urgent measures for the reform of the labor market, the company collective agreement became especially relevant, so that the company collective agreement took precedence over sectoral collective agreements.

A company collective bargaining agreement allows employers and employees to quickly adapt to changes within the company and its economic, production, and/or organizational evolution. In this way, companies are able to better control their operating costs, improve productivity, and, very importantly, ensure that regulations are tailored to the specific situation of each company.

However, company agreements should never mean forgetting sectoral agreements, as these are essential as a supplementary rule when there is a company agreement or as the main rule in cases where there is no company agreement.

And in this last aspect, it is worth highlighting the Supreme Court ruling in which it analyzes the situation of concurrence between a Collective Agreement of a security company in Madrid, and the applicable Sectoral Agreement, to finally conclude that the company agreement does not have priority of application, understanding that, due to the circumstances in which it was negotiated, its scope is less than that of the company.

The Supreme Court insists that an agreement negotiated exclusively with the representatives of workers in a specific geographical area smaller than the company does not qualify as a company agreement. Therefore, the priority of application of a company agreement does not extend to agreements of a smaller scope.

 

Conclusion:

In short, the Supreme Court classifies the Collective Bargaining Agreement as having a scope lower than that of a company, understanding that, since it was negotiated with the workers' representatives in Madrid and the company operates throughout the country, the Agreement does not apply to all workplaces nationwide but only to those in Madrid. Therefore, the provisions of the company's Madrid Collective Bargaining Agreement that are incompatible with the Sectoral Agreement must not be applied because the only exception that allows other conditions to take precedence over the Sectoral Agreement is if those conditions are stipulated in a Company Agreement.

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