Labor Newsletter. May 2026

Must a Company pay notice compensation to an Executive in the event of unfair dismissal despite this having been excluded and agreed by contract?
Supreme Court, Labour Chamber, Judgment 281/2026, 16 March 2026, appeal no. 4506/2024

In the case under analysis, the senior executive's employment contract expressly excluded the requirement of prior notice in the event of dismissal of the manager. However, upon his dismissal, the Supreme Court recognised his right to receive, in addition to the compensation for unfair dismissal, the compensation agreed for failure to give prior notice.

The Court considers that the company cannot unilaterally avoid payment of the notice compensation when it seeks to terminate the relationship between the parties by means of a mere formal communication of a dismissal without cause, which was declared unfair.

Accordingly, in cases involving senior management and executive positions with specific termination clauses, it is advisable to review all economic liabilities arising from termination. That exception can only operate where the dismissal is declared fair on the grounds of an established cause.

May the Labour Inspectorate enter a company's registered office without judicial authorisation if no records are being inspected?
Supreme Court, Administrative Litigation Chamber, Judgment 441/2026, 14 April 2026, appeal no. 3188/2025

The Supreme Court holds that entry by the Labour and Social Security Inspectorate (ITSS), with police support, into the registered offices of legal entities that are also workplaces requires prior judicial authorisation where there is no consent from the holder, even if no documents are being recorded.

The judgment notes that an exception could exist where the office area of the registered office and the workplace area are appreciably and physically separated, and the inspection is clearly confined to the latter.

For practical purposes, the Company should bear in mind that, where such a delimitation exists, refusing entry could give rise to an administrative penalty for obstruction of the inspection activity.

When may the prior hearing before a disciplinary dismissal be omitted, on the grounds of exceptional circumstances?
High Court of Justice of Cantabria, Labour Chamber, Judgment 76/2026, 30 January 2026, appeal no. 961/2025

The High Court of Justice of Cantabria upholds the fairness of the disciplinary dismissal of an employee who massively downloaded the company's customer information — over 475,000 records corresponding to more than 16,000 customers — onto a corporate computer and a USB device. The Chamber considers that the conduct amounted to a breach of contractual good faith and created a significant risk for the company in terms of confidentiality, data protection, and relations with third parties.

The Court finds that exceptional circumstances were present: real-time detection of the download, the employee's immediate acknowledgment of the facts, the potential risk of misuse of the data, and the need to act immediately to protect the company and its customers.

The exception set out in Article 7 of ILO Convention No. 158 (which requires a prior hearing unless it "cannot reasonably be expected of the employer") is beginning to be reflected in judicial doctrine.

May a company require employees to use their personal mobile phone for work-related applications?
Spanish Data Protection Agency (AEPD), Decision in sanctioning proceedings, file no. EXP202411411

The AEPD imposed a fine of EUR 200,000 on a company in the VTC (ride-hailing) sector for requiring its drivers to use mobile devices — whether personal or company-issued — with applications necessary for the provision of the service, after finding that these applications allowed the collection of data exceeding what was strictly necessary, including geolocation data, personal information, contacts, voice recordings, photographs, videos, and information on the employees' physical condition.

The Agency further considers that the information provided as to what data is collected, how the applications operate, and how disconnection should take place at the end of the working day was insufficient — issues that are especially sensitive where the digital tool is installed on a personal device.

The practical recommendation is to carry out, in advance, a review of the actual permissions granted to the applications, the proportionality of the data processed, the applicable legal basis, and the information provided to staff, before implementing or maintaining technological solutions linked to the performance of work, particularly where these affect personal devices or may operate outside working time.

May a company collect an employee's keys and remove them from a WhatsApp group while on sick leave?
High Court of Justice of Galicia, Labour Chamber, Judgment 5527/2025, 9 December 2025, appeal no. 3227/2025

The High Court of Justice of Galicia upholds the dismissal of a claim brought by an employee seeking compensated termination of his contract and additional compensation for breach of fundamental rights, after alleging a situation of harassment linked, among other matters, to a request for the return of the keys to the warehouse, his removal from the staff WhatsApp group, and occasional delays in the payment of payslips during a period of temporary incapacity.

The Chamber considers that there was no harassment or breach of fundamental rights, finding that the company's measures had an objective and reasonable explanation: since the employee was on sick leave, work tools had to be returned to the company, as there was no point in him retaining them if he was not going to use them, and had he not been removed from the staff WhatsApp group (which he was), this could have affected his right to digital disconnection.

The judgment offers an interesting point for reflection: the right to digital disconnection does not operate solely as an argument in favour of a finding of harassment where the company contacts employees outside working hours or during sick leave. It may also operate in the opposite sense, as a factor justifying certain business decisions, provided that these are proportionate and consistent with the protection of that right. In this case, removal from the staff WhatsApp group is assessed precisely as a measure compatible with the purpose of avoiding work-related communications during temporary incapacity, rather than as an indication of isolation or retaliation.