Illegal secondment of workers

Illegal secondment of workers
Published on: 14 January 2022

Table of contents

Many workers find themselves, at a certain point in their careers, in the situation of working for a company with which they have not signed an employment contract. This is what is known as secondment of workers, which can be legal or illegal, as the case may be. Here we would like to tell you everything you need to know about it.

When is a secondment of workers illegal?

Article 43.1 of the Workers' Statute is very clear in this regard. Specifically, it states that the temporary assignment of an employee by the company that has hired him/her to another company is a matter that can only occur in the case of Temporary Employment Agencies authorised to do so.

However, over time, case law has established other cases. For example, those carried out by an agricultural cooperative to an agricultural holding are not considered to be illegal transfers of workers as long as the affected parties are members. Likewise, those involving disabled workers and carried out by special employment centres for the purpose of integrating them into the labour market are legal. Finally, reference should also be made to the transfer of port workers, provided that they have been hired by the Sociedad Anónima de Gestión de Servicios Portuarios (Port Services Management Company), provided that they are carried out to a company with a goods handling licence.

In other words, an illegal assignment occurs when company A signs a contract with an employee for the purpose of hiring him or her to work for company B instead of company A. Generally, this is done because the employee's working conditions in company A are worse than those in company B. This is usually done because the employee's working conditions in company A are worse than in company B. In addition, company B is able to avoid certain conditions of employment. In addition, company B can thus avoid certain risks associated with hiring a person.

When does the law determine that there is an illegal transfer of workers?

Specifically, the law establishes three assumptions when it comes to determining that an illegal assignment is taking place. These are:

  • When the company that signs and transfers the worker to another company does not have its own stable organisation, does not have a specific activity and does not have the indispensable means for the execution of the basic business tasks.
  • When the service contract signed between two companies is limited solely and exclusively to the provision of a certain number of workers by one company to the other.
  • When the company that hires and, therefore, assigns the worker is not responsible for carrying out the employer's own activities, i.e. giving orders, paying wages, imposing penalties, approving the holiday rest period, etc.

In short, the assignment is illegal when the company that receives the worker is in charge of carrying out all the functions that legally correspond to the company that hired the worker.

The case of the contractors

Contractors and subcontractors are companies that have flourished as a result of companies' outsourcing processes. This term refers to the outsourcing of certain services. 

The best way to define what a subcontractor is is to use an example. A construction company wins a tender to undertake a project but, instead of carrying it out itself, it delegates another company to do it. This is the contractor. In turn, in order to carry out a specific and determined task, the latter hires another, which would be the subcontractor. 

But why are subcontracts legal and the transfer of workers when they are not carried out by a temporary employment agency? Basically, because subcontractors have their own organisation, a defined professional activity, manage the means of production and exercise their responsibilities with respect to the worker. Moreover, the employee signs his or her contract with them. 

Can there be an unlawful transfer in the public administration?

The answer is yes. In this type of case, the temporary workers, once the illegality of the employment relationship has been demonstrated, become employees of the Public Administration through an indefinite, but not permanent, relationship. This is due to the fact that, legally, the only way to hold a public post is by means of a competitive examination, competition or, in short, any legally established procedure provided for in the Constitution.

What are the consequences of illegal agency work?

First of all, both the company that signs the employee and assigns him or her and the company that receives him or her are jointly and severally liable to the employees. This means that both have the responsibility to pay the social security contributions and the salaries of the employees concerned. In addition, by violating Articles 8 and 18 of the Law on Social Security Penalties and Infringements, they will face a very serious penalty. Specifically, this could amount to €187,515 and even lead to criminal liability. 

On the other hand, once the illegality of the assignment has been determined, the worker may decide in which company he/she will continue to work and automatically acquire permanent status. In fact, it does not matter whether his contract was temporary or permanent, as the law recognises this right.

Tools of the worker if he/she believes he/she is illegally seconded

Current legislation provides the worker with a series of tools with which to confront the illegal assignment. The first of these is, of course, to sue both companies to put an end to the irregular employment situation. This is when you will be able to choose between remaining as a permanent employee in the company to which you have been assigned or becoming part of the staff of the assignee company. 

On the other hand, the lawsuit must always be filed while you are still in the situation of illegal assignment. This means that, once the employment relationship between the parties is terminated, the interested party will not be able to make any claim. In this sense, it is usually recommended that, together with the lawsuit, those affected include the "Papeleta de Conciliación". In this way, they can avoid certain problems arising if circumstances change over time. 

In the event that the dismissal takes place while the employee is in a situation of illegal assignment, the employee has the right to allege that this has taken place in the Papeleta de Conciliación. In this way, he/she would automatically act against both companies, i.e. the transferor and the transferee. 

Conclusions on the illegal transfer of workers

As you may have noticed, illegal agency work is a rather ambiguous subject in legal and labour law. In fact, in many cases, it is actually quite complex to determine. This is especially visible in the case of contract work. It should not be forgotten that the creation of shell companies has been a very common practice for many years and that, nowadays, it is still quite difficult to detect. In any case, legislation always takes the side of the worker and, moreover, strongly punishes those companies that commit this offence, as we have seen above.

Whether you have been dismissed or not, you can claim for unlawful dismissal. To do so, contact G. Elías y Muñoz Abogados now and our lawyers specialised in claims for unlawful dismissal of workers will advise you.

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