Spain's Supreme Court rules on time limits for salary debt claims
Published on 26th Oct 2023
Ruling clarifies that the limitation period for claiming salary debts in a business succession is one year from accrual
Context of the case
The High Court, in its ruling issued on 19 July 2023, addressed whether a worker's claim for wages accrued for the provision of services in a transferor company is time-barred as a result of a business succession.
The question focuses on determining whether the applicable limitation period is the general one-year period, provided for in article 59.1 of the Workers' Statute, or three years, according to article 44.3 of the Workers' Statute, which acts as a special limitation period in the case of company succession.
Supreme Court's interpretation
According to the High Court, the three-year period refers only to the duration of the joint and several liability between the assignee and the assignor, with regard to the employment obligations that arose prior to the transfer and which have not been satisfied.
The judgment concludes that, regardless of whether the joint and several liability was still in force to respond to the claim, the worker's action is considered time-barred. This is because the worker brought the claim action after the period of one year had elapsed from the accrual of the debt, which is the general limitation period established by law for actions arising from the employment contract. In this regard, it is important to differentiate the start of the time periods between articles 44.3 and 59.1 of the Workers' Statute:
- The three-year period established in article 44.3 of the Workers' Statute is a limitation period that starts to run from the date of the business succession, and which temporarily limits the joint and several liability between the transferor and the transferee company.
- The one-year period stipulated in article 59.1 of the Workers' Statute is a limitation period that starts to run from the date of accrual of the wage debts.
Osborne Clarke comment
In summary, the ruling establishes that only if the action corresponding to the wage claim is still alive during the period of limitation of the joint and several liability, the worker may bring a claim action against the companies involved in the business succession.