- The Supreme Court declared void an equality plan agreed with five people appointed by the company itself.
- The court equates equality plans with collective agreements: they must be negotiated by those entitled to do so.
- The current rules require a negotiating committee, a prior diagnosis and registration of the plan.
This week a ruling of the Social Chamber of the Supreme Court, dated 26 January 2021 (appeal 50/2020), has been made public, declaring void the equality plan of a company with more than 250 employees. The company had agreed it in 2010 with a committee of five people appointed by itself, without involving the employees’ legal representatives or the trade unions. The Supreme Court rejects that route as valid.
The decision matters to any company obliged to have an equality plan, that is, those with 50 or more employees, with staggered deadlines ending in March 2022. A poorly negotiated plan can be annulled, with the cost of redoing it and the uncertainty that brings for the company and its workforce. In addition, a void plan leaves the company in breach, with possible administrative penalties.
The court’s doctrine
According to the ruling, equality plans must be negotiated like collective agreements, by those entitled to negotiate company agreements. The law on effective equality of women and men refers to that negotiation, and the Workers’ Statute specifies who is entitled: on the workers’ side, the elected representatives or the union branches and unions, depending on the case.
The court recalls that ad hoc committees are an exceptional mechanism, provided for specific flexibility measures such as geographic mobility, substantial changes, collective dismissals or the opt-out from collective agreements, and not a substitute for collective bargaining. It adds that a company that finds no valid counterpart cannot simply impose the plan, except in very exceptional situations, such as a refusal to negotiate by the other side.
The current regulation
Royal Decree 901/2020 of 13 October regulates equality plans and their registration, and has been in force since 14 January 2021. It provides for a negotiating committee, a prior diagnosis of the workforce situation and registration of the plan. If the company has no legal workers’ representation, the committee is formed with the most representative unions in the sector.
A second royal decree, 902/2020, of the same date, regulates equal pay and will enter into force on 14 April 2021. It obliges every company to keep a pay register and those with an equality plan to carry out a salary audit. The register requires breaking down by sex the average and the median of salaries, supplements and non-salary payments, by occupational group. Both rules make it more demanding to document how it is decided who is paid what, and why.
What to review
If your company has an old equality plan, it is worth checking how it was negotiated, who signed it and whether it is registered. A plan agreed under doubtful conditions can be challenged by the unions. If you must draw up a new one, the first step is to identify who holds the workers’ representation, rather than improvising an ad hoc committee.
It is also worth documenting the diagnosis and the measures, and preparing the pay register before April. Where there are doubts about who represents the workforce, the prudent route is to call the sector’s unions and record each step in writing. Companies with fewer than 50 employees can also approve voluntary plans, which can likewise be registered. This information is general; for a specific case, consult your labour adviser.
Equality in a company is negotiated: a plan not agreed with the right counterpart runs the risk of falling apart.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
