Advances for the recognition of unemployment benefit in the Special System for Domestic Employees

The Court of Justice of the European Union ruled on 24 February that the exclusion of domestic servants from unemployment benefits under Spanish law is contrary to EU law.

A Galician domestic worker applied to the TGSS in 2019, supported by her employer, to pay unemployment contributions in order to obtain the right to this benefit, but the General Treasury of the Social Security (TGSS) denied her request, as it was expressly excluded from Spanish legislation. Against that decision, the worker appealed to the Administrative Court No. 2 of Vigo, which referred the matter to the Court of Justice of the European Union (CJEU), asking whether the law, which excludes unemployment benefit from the special Social Security system for domestic workers, is contrary to the European directive on equal treatment in matters of Social Security.

It should be recalled that the percentage of women in the special system for domestic workers is much higher than that of men and, therefore, indirect discrimination on grounds of sex could be involved unless it can be shown that this measure is justified.

The State and the TGSS argued that the decision to exclude domestic workers from unemployment protection is aimed at maintaining employment rates and combating illegal work, given that the increase in wage costs due to the increase in contributions to cover this contingency could result in a reduction in hiring and/or termination of contracts, as well as leading to situations of illegal work, thus encouraging the black economy. Both conclude that this is a proportionate measure, given that unemployment is not generalised in this group and it is the only contingency against which they are not protected.

On the other hand, the CJEU held that the defences put forward by the Spanish Government and the TGSS do not show that the means chosen by the State are adequate to attain the legitimate social policy objectives pursued, for the following reasons:

• The measure is not applied consistently and systematically in comparison with other groups of workers who receive unemployment benefits, despite the fact that their working conditions and characteristics are identical to those of domestic servants (e.g. gardeners, chauffeurs, or workers employed by cleaning companies).
• The other contingencies, for which domestic workers are covered, supposedly present the same risk of social security fraud as unemployment. It is therefore inconsistent that inclusion in the Special System for Domestic Workers does, in principle, give entitlement to all the benefits granted by the General Social Security Scheme, such as accidents at work and occupational diseases, but does not protect against unemployment
• For these purposes, exclusion from unemployment protection is not necessary to achieve the objectives argued, as it implies the impossibility for domestic workers to access other social security benefits whose granting is conditional on the termination of entitlement to unemployment benefits, such as permanent disability benefits or social assistance for unemployed persons, which results in a situation of helplessness and injustice.

For all these reasons, the CJEU declares that the national provision which excludes domestic workers from unemployment benefits is contrary to EU law, in so far as it places female workers at a disadvantage compared with male workers and is not justified by objective factors unrelated to any discrimination on grounds of sex.

It is therefore concluded that all male and female employees registered with the General Social Security Scheme are entitled to unemployment benefits, including all domestic servants.

As a result of this ruling by the Luxembourg court, the door has been opened to a possible shower of court decisions applying the new doctrine. This is the case of the 32nd social court in Barcelona, which has handed down the first judgement that considers the exclusion of this group of workers from the coverage of the Wage Guarantee Fund (FOGASA), the body to which workers have recourse in the event of company insolvency, to be discriminatory. According to the judge, the impossibility of accessing FOGASA protection would not be justified and would constitute a violation of the European directive on the application of the principle of equal opportunities and equal treatment of men and women in matters of employment and occupation.

Thus, the court has ordered FOGASA, an autonomous body attached to the Ministry of Labour and Social Economy, to pay compensation of 6,000 euros to a female worker who worked for almost seven years in a home until she was verbally dismissed in October 2016. Following a lawsuit, the court ruled that the dismissal was unfair and ordered the employer, which later became insolvent, to compensate its former employee.

Another recent ruling by the High Court of Justice of Catalonia (TSJC) has for the first time recognised unemployment benefit for the over-52s for a domestic worker. The court ruling, dated 16 March, rejects the claim brought by the State Public Employment Service (SEPE), which argued that, as the worker had not contributed for sufficient time before applying for the benefit, she did not meet the requirements for access to this monthly payment of 463.21 euros. The judges pointed out that the national legislature itself expressly recognised the absence of an internal regulatory framework for unemployment protection in favour of this group. It is at this point that they turn to European jurisprudence which, examining a similar case, has determined that Spain incurs in indirect discrimination on the grounds of gender with regard to the group of domestic servants, as the vast majority are women and are deprived of unemployment protection.

After learning of the European Court’s ruling and recent local rulings (present and future), sources in the Ministry of Labour assured that work would be done to recognise the right to unemployment for this group, as well as the process of ratifying Convention 189 of the International Labour Organisation (ILO) was underway. The Ministry of Labour and Social Economy has declared that it is already working to try to bring forward as soon as possible a welfare benefit to cover this legal vacuum for the domestic workers.

The labour management department of AddVANTE remains at your disposal for further information or to resolve any queries that may arise in relation to this article.