Which collective bargaining agreement is applicable? Understanding the business succession scenario in Spain

Alfredo Aspra
Labormatters, Madrid
alfredo.aspra@labormatters.com

Yolanda Cano
Labormatters, Madrid
yolanda.cano@labormatters.com

This analysis is based on the premise that the transaction constitutes a transfer within the meaning of Article 44 of the Spanish Workers’ Statute (ET) and European Union Directive 2001/23/EC. If such a ‘transfer’ does not occur in a legal sense, the determination of the applicable collective agreement is guided by the general rules governing the structure and scope of collective bargaining.

Article 3.3 of Directive 2001/23/EC of 12 March 2001, concerning the protection of employees’ rights in the event of transfers of undertakings, business units, or parts thereof, requires that, following the transfer, the transferee continues to observe the terms and conditions established in the collective agreement ‘under the same terms’ as those applicable to the transferor, until the agreement expires or is terminated, or until another collective agreement comes into effect. The Directive allows Member States to limit this continuation, provided that such limitation does not apply for a period of less than one year.

The Spanish legislator did not introduce a general time limit of this kind but addressed the matter in Article 44.4 of the Workers’ Statute (ET), establishing a reference rule that, in practice, can be explained in three phases: continuity rule, duration of continuity, and subsequent agreement.

Continuity rule

Unless otherwise agreed, the employment relationships of employees affected by the business succession continue to be governed by the collective agreement that, at the time of the transfer, was applicable in the company, workplace or autonomous productive unit being transferred.

Duration of continuity

Such application remains in force until the expiry date of the original collective agreement or until another collective agreement comes into effect that becomes applicable under the parameters set out in Article 44.4 ET.

Subsequent agreement

Article 44.4 ET specifically allows that, once the succession has been completed, the successor company and the employees’ legal representatives may agree on which collective agreement will apply (‘unless otherwise agreed, established through a company-level agreement…’).

Regarding this point, it should be clarified that the ‘unless otherwise agreed’ referred to in Article 44.4 ET does not operate as an abstract clause in the sale agreement or corporate transaction, but rather as a company-level agreement between the transferee and the employees’ legal representatives. This is established by the statute after the succession has been completed, with the purpose of determining the applicable collective agreement framework during the integration.

On this seemingly clear basis, the determination of the applicable collective agreement becomes more complicated in Spain due to the very structure of collective bargaining. On the one hand, Article 83.1 ET allows collective agreements to have the scope agreed upon by the parties (sectoral, company-level, group, territorial, etc). On the other, Article 83.2 ET enables the organisation of the bargaining structure through agreements between the most representative trade unions and employer associations, establishing scope for negotiation and rules for coordination.

In turn, Article 84.1 ET contains the general rule on concurrent applicability: during its term, a collective agreement may not be affected by another agreement with a different scope, except in the case of a structural agreement under Article 83.2 ET or as provided in Article 84.2 ET. The latter provision establishes, as a relevant exception, the precedence of a company-level (or group-level) agreement over higher-level sectoral agreements in specific matters. These include: payment or compensation for overtime; specific remuneration for shift work; work schedules and distribution of working time, shift systems, and annual holiday planning; adaptation of the professional classification system to the company scope; adaptation of aspects of employment modalities attributable to company agreements; measures for shared responsibility and work-life balance; and any other matters governed by agreements or collective agreements under Article 83.2 ET.

Within this framework, it should be emphasised that Article 44.4 ET functions as a special rule regarding transfer in the context of collective agreements. It establishes a specific criterion for personnel affected by the business succession and, therefore, is not automatically overridden by the mere existence of another collective agreement (sectoral or company-level) already applicable in the transferee entity independently of the transfer.

Finally, the time-related dimension of the collective agreement adds further complexity. Article 86.3 ET establishes that, once a collective agreement has been put under notice and its agreed duration has ended, its validity continues under the terms set out in the agreement itself; and during negotiations for renewal, in the absence of an agreement, its validity is maintained. Additionally, it provides a framework for action after one year has elapsed from the notice if no new agreement has been reached. This practical continuity interacts directly with Article 44.4 ET when a transfer occurs while a collective agreement is under notice, extended, or under negotiation.

The combination of: (1) the obligation to maintain conditions in the event of a transfer (Directive 2001/23/EC and Article 44.4 ET); (2) a multi-level bargaining structure with rules on concurrence and priority; and (3) the frequent reality of agreements under notice or extended, raises recurring issues in determining which collective agreement applies – and from when – to groups of employees who, following a business succession, come together within the same enterprise.

The case law of the Spanish Supreme Court has progressively consolidated interpretative criteria that are useful for systematising the application of Article 44.4 ET. Without prejudice to specific cases, these principles can be operationally organised into five key points:

1. Rule for determining the applicable collective agreement at the date of the transfer

Transferred personnel are, as a starting point, subject to the collective agreement that was applicable in the company, workplace, or transferred productive unit at the time of the succession. The mere fact that a different collective agreement exists in the successor company does not, by itself, determine a change. (STS 1263/2025, 16 December)

2. Expiration of validity and maintenance by agreement

The expiry of the original collective agreement does not automatically result in the application of another agreement to the transferred personnel. The previous agreement may continue to apply if there is an agreement for its continuation under the terms permitted by the applicable framework. (STS 601/2025, 23 June)

3. Entry into force of a ‘new’ collective agreement after the succession

When, following the transfer, a new collective agreement comes into force that is applicable in the successor company, that new framework applies to the transferred personnel in accordance with the logic of Article 44.4 ET. (STS 504/2024, 20 March)

4. Concurrence of collective agreement frameworks: maintenance of the originating agreement and ultra-activity

In cases of overlapping collective agreement frameworks (an agreement in the transferred company and a different agreement in the successor company), the originating agreement continues to apply to the transferred personnel until it expires; and, where applicable, during any effects arising from extension/ultra-activity, without automatic replacement by the successor company’s agreement. (STS 1208/2023, 21 December)

5. Replacement of the originating agreement by a subsequently applicable agreement ( ‘new agreement’)

The agreement of the transferred company ceases to apply to the subrogated personnel when, following the transfer, a new collective agreement comes into force that is applicable as required by Article 44.4 ET, displacing the previous agreement. (STS 449/2021, 28 April)

Conclusion

Spanish legislation on the applicable collective agreement following a business succession can be formulated relatively simply, but its application requires method. Except for a valid subsequent agreement, the affected personnel continue under the collective agreement that was applicable in the transferred unit at the time of the transfer, and that framework remains in force until the agreement expires or until a new collective agreement becomes applicable under Article 44.4 ET. The real challenge is not stating the principle, but proving and applying it within a collective bargaining system with rules on concurrence and frequent scenarios of agreements under notice, extensions or renewal negotiations. Therefore, in business succession operations, the precise identification of the reference agreement, its validity status, and the milestones that may trigger its replacement is a central element of labour due diligence and integration planning.