DELAY IN SALARY PAYMENT AS JUST CAUSE FOR TERMINATION OF THE EMPLOYMENT CONTRACT AT THE WORKER’S INITIATIVE

The recent Organic Law 1/2025 of 2 January, on measures regarding the efficiency of the Public Justice Service, has introduced significant legislative reforms that have gained particular prominence in the current legal landscape.

Specifically, and with effect from 3 April, one notable amendment is that introduced by Final Provision Twenty-Six of Organic Law 1/2025, which modifies the consolidated text of the Workers’ Statute Act, approved by Royal Legislative Decree 2/2015 of 23 October.

This final provision, among others, stipulates the amendment of Article 50 of the Workers’ Statute concerning “Termination at the worker’s request“, which now reads as follows:

The following shall constitute just cause for the worker to request termination of the contract:

a) Substantial modifications to working conditions carried out in breach of Article 41 and resulting in a detriment to the worker’s dignity.
b) Non-payment or persistent delays in the payment of the agreed salary. Without prejudice to other cases that may be deemed just cause by the judge or the court, a delay shall be deemed to exist when the payment date is exceeded by more than fifteen days. Just cause shall be deemed to exist where the employer owes the worker, within a one-year period, three full monthly salary payments, even if non-consecutive, or where there is a delay in salary payment during six months, also even if non-consecutive.
c) Any other serious breach of the employer’s obligations, except in cases of force majeure, including refusal to reinstate the worker under their former conditions in the situations provided for in Articles 40 and 41, when a judicial ruling has declared such refusal unjustified.

In such cases, the worker shall be entitled to the compensation established for unfair dismissal.

In this regard, particular attention should be paid to subsection 1(b) of this provision, as its reform introduces, for the first time, an objective criterion to determine a legal ground for voluntary termination by the worker in cases involving delays in salary payment.

This objective criterion consists of the establishment of a specific time frame and defined conditions for such delay, which give rise to a legal ground for contract termination at the worker’s initiative. In particular, Article 50 of the Workers’ Statute provides for:

  • A time frame whereby the delay in salary payment exceeds 15 days.

  • The condition that such delay is repeated and continuous over time.

The introduction of this objective criterion enhances legal certainty, as it eliminates the need for the courts to determine whether the delay in payment is to be interpreted as “serious” or not.

Moreover, the amendment to Article 50.1(b) of the Workers’ Statute brings in significant benefits for workers, as it grants them the right to terminate their contract based on the newly defined legal grounds, with entitlement to compensation equivalent to unfair dismissal, that is, 33 days’ salary per year of service. Additionally, in such cases, workers are entitled to unemployment benefits.

Therefore, a clear comparison can be drawn between the situation prior to the legislative reform introduced by Organic Law 1/2025 of 2 January and the current legal framework, which demonstrates a marked increase in legal certainty in such scenarios:

Before the reform Current situation
Article 50 of the Workers’ Statute, prior to the reform, referred to “non-payment or persistent delays” as a legal ground for voluntary termination by the worker, without specifying time frames or conditions. The legislative reform introduces an objective criterion by setting out a time frame and conditions so that delays in salary payment exceeding 15 days, when repeated over time, constitute just cause for voluntary termination of the contract by the worker.

In short, these legislative developments establish a clear and well-defined interpretative criterion, which enhances legal certainty and eliminates potential doubts in cases of salary payment delays.

Accordingly, it is evident that this reform impacts both parties in an employment relationship: workers and employers. It directly affects companies, requiring increased vigilance from employers and human resources personnel, since, as discussed, this new criterion must be closely observed to avoid situations that may automatically give rise to lawful termination of the employment contract by the worker.

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