Spain’s government implemented several emergency measures designed to protect jobs during the pandemic. Among these, article 2 of Royal Decree-law 9/2020 states that an employer cannot terminate an employment contract based on force majeure, financial, productive, technical, or organisational grounds connected to the pandemic.

However, the provision did not include the consequences of breaching.

In case 841/2022, the Plenary Session of the Fourth Chamber of the Supreme Court established the criterion for interpretation of the article mentioned above 2, meaning that its infringement does not render the dismissal null and void but rather unfair.

The Court stated that the legislation contains a “decriminalization, a neutralization of the grounds for termination” but not, in any case, a prohibition of dismissal: it “does not prohibit the termination of contracts, but rather removes the coverage of the dismissal due to business difficulties”.

According to the Court, Royal Decree-law 9/2020 does not contain a genuine prohibition of dismissal, but rather a temporary restriction of its fairness, as the applicability of the provisions regarding the grounds for dismissal for objective reasons, collective dismissal or due to force majeure - that previously would have been considered fair - has been suspended.

Moreover, the Court highlights that article 2 of the Royal Decree-law 9/2022 “is not applicable when the origin of the economic or production reasons justifying the dismissal had commenced before the pandemic and arose from a structural or sectoral crisis, but not from the health crisis”.

The judgment is very relevant for many cases still pending by the courts.

It adds to the now copious case law (you can find other decisions in our previous editions) on dismissals related to the Covid 19 pandemic and national employment protection legislation at this historical stage.