UNIT 1: LABOUR LAW.

Dr. David Montoya

This introductory lesson has two main purposes:

1) On the one hand, to understand what Labour Law is as an

autonomous legal discipline, that is, knowing and understanding what
the scope and characteristics of Labour Law are, as a independent
branch of our legal system.

2) On the other hand, to be familiar with the historical, social and

legal factors that led to the emergence and development of Labour Law
and its current institutional, legal and academic autonomy.

1.- Concept of Labour Law.

To make a first approach to the concept of Labour Law and its

scope, it is worth reminding here what the meaning of “Law” or a legal
system is.

As it is known, a legal system is a set of written or customary

rules born within a particular social group for the purpose of ordering
relations among individuals and solve conflicts which may arise
between them.

Thus, the notion of Law is linked to society and social groups

because where there are social groups, social relations are triggered and
where there are social relations, Law arises (Ubi societas ibi ius, i.e
where there is society, there is Law). Every single society, no matter how
primitive it is, must be provided with some sort of rules aimed at
regulating peaceful coexistence among its members. Those rules are,
precisely, the Law or the so-called legal system.

The legal system is unique. However, in contemporary societies,

due to the wide range of social relations that are triggered within them,

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the legal system is forced to create branches to organise society with
criteria of rationality and efficiency. In the words of Jaime Guasp, "Law
is one in its essence but their manifestations are many." In short, that is
why nowadays modern legal systems are organised in different
branches or legal sectors (Civil Law, Administrative Law, Criminal Law,
Tax Law, Labour Law, etc.).

Each sector or branch of legislation regulates specific social

relations that constitute its scope, but in order to become an
autonomous legal discipline specific inspiring principles are also
needed. Therefore, returning to the subject of this section of the lesson,
it can be said that in order to define Labour Law, two factors must be
referred to:

1) The scope of Labour Law.

2) Its guiding principles.

1 - The scope of Labour Law

The scope of Labour Law is constituted basically by the set of the

social relations that arise from the rendering of services of one person to
another. However, not all kind of work carried out among people is
regulated by Labour Law but only those that meet a number of features:

1) Free or volunteer work

2) Remunerated work

3) Dependent work, that is, t the performance of work under the

organisation and direction of somebody else.

4) Work for hire (hired-hand work), that is, services rendered on

behalf of another person.

In general terms, only when the work rendered fulfils the above
defining elements, shall it be regulated by Labour Law. These elements,
of course, have not been created by scholars yet are required by the

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Worker’s Statute (WS) when delimiting the scope of Labour Law (art.
1.1)1 and are necessary to identify the existence of employment
contracts (art. 8.1 ET)2 . Therefore, these legal features are required by
judges and courts to describe a particular employment relationship as
regulated by Labour Law. The concept and meaning of such notes
identifying employment relationships regulated by Labour Law will be
analysed in lesson 5, focused on employment contracts.

To sum up, Labour Law will only apply to workers who render
their remunerated services voluntarily, on behalf of another person, and
under his organisation and supervision.

2.- Inspiring principles.

As it has been said here, Labour Law scope is constituted by the

work provided voluntarily, remunerated, on behalf of another person
and under its power of organisation and management.

Notwithstanding, to qualify Labour Law as an autonomous legal

discipline it is not enough to have an object itself to be regulated. The
existence of an independent body of detailed rules with its own
principles and legal institutions is also necessary.

Indeed, nowadays Labour Law, as an autonomous branch of our

legal system, has an independent regulatory system based on own
principles. Nevertheless, this has not always been the case. The
following has to be taken into account:

1) When industrial revolution and capitalism arose, relations of

production based on exchange of volunteer and paid work, dependent
and on behalf of others were developed progressively. These working

1
Article 1. Scope of Application. 1. The present Law shall be applicable to the workers voluntarily
rendering their services for compensation on behalf of another party, within the scope of the
organisation and management of another, physical or legal person called the employer or entrepreneur.
2
Article 8. Form of Contract. 1. The work contract may be formalised in writing or orally. It shall be
presumed to exist between anyone rendering a service on behalf of and within the scope of the
organisation and management of another, and the person receiving it in exchange for a compensation
paid to the former.

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relationships were governed by Civil Law, based on the principle of free
will, and channelled through the services contract.

2) With the development of the capitalist society and production

relations based on the exchange of personal services for remuneration,
a range of historical, social and legal factors trigged the adoption by the
States of certain rules regulating some aspects of those relations. Those
rules were not inspired by the principle of free will (also called
“autonomy of the will”). They were policy working rules inspired by
principles totally opposed to those of the civil contracts.

3) The latter is important because the appearance of these first

policy working rules, inspired by specific principles, marked the birth of
the first labour regulations and, therefore, the genesis of Labour Law as
an autonomous legal discipline.

Broadly speaking and oversimplifying, it can be said that there

were three factors that led to the progressive academic, institutional
and legal autonomy of our discipline: 1) the proliferation and
development of those policy working rules; 2) appearance of the
employment contract as a special contract type, subjected to a specific
legal regime, different to the one applied to the services contract; 3) the
growth and development of trade unions and union power, as well as
the birth of the Labour Law specific source of rights: the collective
agreements.

So, what are the principles that inspired those rules whose
proliferation determined, among other factors, the emergence of Labour
Law?

These rules were inspired by the principle of protecting the

weaker party of the contractual relationship: the principle of limitation
of the parties’ free will.

Whilst in Civil law the principle of free will prevails, according to

which the main source of the regulation of the rights and freedoms of

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the parties is the contract (art. 1255 CC), in Labour Law a totally
opposed principle prevails: the limitation of the parties’ free will.
According with this principle, the contract is not the main source of
regulation of the working rights and obligations but the legal labour
standards. Hence, it is commonly asserted that the employment
contract is a “regulated contract”, because its content is predetermined
by legal regulations, being very low the regulatory margin for the
parties.

This general principle of limitation of the party autonomy, leading

the legal regulation of labour relations, can explain the today’s existence
of three important principles which guide the application of labour rules
and are even covered by WS:

- The principle of a more favourable rule (art. 3.3 WS)

- The principle of a more beneficial condition (art. 3.1 c) WS)

- The principle of inalienability of rights (art. 3.5 WS)

The first of these principles is aimed at solving conflicts between

labour rules and the remaining two regulate the relationship between
labour standards and the parties’ free will. However, the study of these
principles will be undertaken in the 4th lesson.

Conclusion.

The purpose of this section was to define Labour Law. It may be

defined as the area of Law which regulates the personal services
rendered voluntarily for compensation, on behalf of somebody else,
under direction and subordination, and which has its own inspiring
principles.

2.- Factors that led to the emergence of Labour Law.

A legal regime of work has always existed, at least, since there is

the first evidence in the history of human exploitation (SALA FRANCO).
By contrast, Labour Law has not always existed in the history of

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humanity. Its genesis is linked to a particular historical period as a
result of the development of certain historical, social and legal factors.
Throughout history there have been as many labour legal regimes as
prevailing modes of production. In the slave mode of production, there
was a work legal regime based on property rights of a person (the
dominus or master) over another (the servus or slave)3. In the feudal
mode of production (feudalism), a work legal regime based on
subordination within the frame of vassalage relationships prevailed 4. In
the capitalist mode of production (capitalism), as it is known, the
scheme of work is based on the free exchange of labour for
remuneration. However, it is not possible to talk about the genesis of
Labour Law since the first evidence of human work exploitation, but
only with the coming of the capitalist society and the free exchange of
labour for remuneration.

Now, Labour Law does not emerge with the mere change of the
production mode from feudalism to capitalism. In fact, once the
capitalist society was running, for many years Civil Law regulated the
employment relationships, so the contract type which ordered these
relations was a civil one: the services contract.

The emergence of Labour Law was gradually triggered as a result

of a long process of economic and social changes that started from the
industrial revolution. Summarising, there were four factors or that
determined the onset or genesis of Labour Law: 1) A sociological factor:
the industrial revolution and its social effects; 2) A legal factor: the
liberal-individualistic Law and its social dysfunction; 3) A social factor:
the labour movement; 4) A political factor: the State intervention in
regulating labour relations.

3
Slaves were considered property under Roman law and had no legal personhood. Unlike Roman
citizens, they could be subjected to corporal punishment, sexual exploitation, torture, and summary
execution.
4
The relationships between feudal lords and his vassals were based on the holding of land in exchange
of a service or labour.

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1.- Sociological factor: the industrial revolution and its social effects.

In mid-eighteenth century and throughout the nineteenth

century, the technological evolution, due to the introduction of
machines in the relations of production, unleashed a set of major
economic and social changes that led societies to a deep transformation
known as the industrial revolution. The industrial revolution brought,
in turn, two important changes:

1) Change in the organisation of work: from the production

concentrated on small workshops and coming from the field, typical of
the feudal society, work turns to be concentrated in factories. First,
large concentrations of capital emerged, companies proliferated and
large-scale production within them.

2) Change in the structure of the working population. In the

feudalism capital and workforce were concentrated on the figure of the
craftsman. However, with the development of a capitalist society both
factors are dissociated due to the emergence of two different social
groups. On the one hand, those craftsmen and farm workers who,
having enough purchasing power could raise capital and set up
factories. On the other hand, those other people who, due to the lack of
enough capital, could only exchange their labour for remuneration for a
living. So, it can be said that two large social groups emerged
(employers and workers) which constituted the leaders of the new
capitalist mode of production.

2.- Legal factor the liberal-individualistic Law and its social dysfunction.

What was the Law that ordered the relations of production during
the early capitalist mode of production like?

As it is known, in the late eighteenth century and throughout the

nineteenth century, liberal ideology became fashionable, leading to a
new understanding of Economics and Law.

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 From an economic point of view, this ideology calls for a non-
intervention of the State in the production of goods and services.
Economy must be left to the free interplay of supply and demand.

From a legal point of view, Liberal Law relies on two principles

that brought the French Revolution: freedom and equality. These
principles transferred to the field of labour contracts at factories implied
two things:

1) Freedom of contracting: the parties’ free will was completely

governing labour relations between employers and workers. Therefore,
the parties decided freely whether or not to conclude the contract, the
contract terms, and also the time to terminate the employment
relationship. As it is known, the contract which conducted this working
relationship was the civil services contract.

2) Prohibition of unionism: Combinations of workers constituted a

criminal conspiracy considered in law as a crime, because the union
interfered with the parties’ freedom by forcing workers to not hire if not
above minimum work conditions.

It is very illustrative in this regard, the identification of this

offence in the Spanish Penal Code of 1848 as a crime of "scheming to
alter the price of the workforce" (“maquinaciones para alterar el precio de
la mano de obra”). Before that and with a similar purpose, the Conde of
Toreno Decree of 1813 abolished the guilds, declaring freedom of work
and industry and banning any professional association (including,
therefore, the unions).

What were the social consequences of applying this liberal-

individualistic law to working relationships?

Liberal Law was of apparent goodness in its theoretical approach

(due to the positive connotation of the terms of liberty and equality) but
of dire consequences in its application in the working relations. The

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principles of freedom and equality had just a merely formal application
in the contractual relationship:

- The contract parties were not free or, at least, freedom was not
for the weakest party, because workers were not free to sign the
contract, but were forced to do so as the only means of livelihood as it
was the only alternative to unemployment.

-The parties were not equal: the employer, as the strongest party
of the employment relationship, imposed the working conditions and
workers could only accept or reject them, but never negotiate.

These circumstances led to a high dehumanisation of work and

very hard living conditions of the working class.

In this regard, contemporary documents and historians published

work refer to the appalling living conditions of the workers living in
overcrowded houses near factories with no health conditions. Also there
were long working days and little remuneration, which was just for
subsistence. An example of common compensation abuse was the so-
called "truck system", a remuneration system which lied on vouchers
that could be exchanged for less quality goods with exorbitant prices.
There was also women and children labour exploitation. Theywere used
as cheap workforce, in conditions akin to slavery, high work accidents,
morbidity and mortality rates due to the absence of social security and
occupational risk prevention systems. It is very known, in this regard,
the assertion of A. Guépin, a French physician from Nantes who said
that "living for workers is not to die" (1935).

3. - Social factor: the labour movement.

The labour movement was undoubtedly the main trigger for the
development of Labour Law. It emerged as workers’ reaction against the
liberal system and employers abuses in labour relations. The incidence
of the labour movement could be appreciated in two different ways:

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 1) From the point of view of the social action, the proletariat
gradually becomes conscious of classes and reacts through direct
action against the excesses of the system:

a) The first workers’ collective actions arose in the form of

clandestine meetings, demonstrations, strikes, and violent actions in
factories. It was especially remarkable the so-called "Luddite". This
social movement first emerged in England, among textile craftsmen who
protested against newly developed labour-saving machinery and they
destroyed them. The movement’s name was originally attributed to Ned
Ludd, a young individual who allegedly smashed two stocking frames in
1779, and whose name became emblematic for destroying machines. In
Spain, there were also expressions of this social movement in the
townof Alcoy in Alicante.

b) In addition, the first workers' associations arose, mainly for two

purposes:

- On the one hand, mutual benefits associations were set up to

cover workers’ social risks protection. A good example of such initiatives
in Spain were the so-called "Mutual aid societies" (Sociedades de
socorros mutuos) which were created for this purpose.

- On the other hand, strike funds were also set up. Such funds
(strike pay) were aimed at providing workers on strike compensation
during the length of the strike.

2) From an ideological point of view, labour movement was

inspired by two streams of thought which both claimedthe
transformation of the society through the struggle of the working class
and the proletariat access to the means of production. As it is known,
these ideological trends were:

- Anarchism: characterised by a revolutionary inspiration. It

rejected any collaboration with the State and refused political parties.

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There were claims for the transformation of the society through workers’
revolution.

-Marxism: characterised by a collaborationist inspiration. There

were claims for the transformation of the society from the State through
political parties, using the State legislative power. Within this school of
thought, the 1848 Communist Manifesto, written by Karl Marx and
Friedrich Engels, and commissioned by the Communist League has to
be highlighted. In addition, the development of the scientific socialism
and the emergence of the first workers' parties have to be pointed out.
The Social Democratic Party of Germany constituted their main model.

4. - Political factor: the State intervention in labour relations regulation.

Due to the notoriety of the Labour movement, States gradually

became aware of the social problems of the working class and began to
step in, through legislative measures, limiting employers’ powers to
regulate the employment relationship and, thus, improving workers’ life
and working conditions.

Expression of this trend is the phrase by Antonio Maura, Spanish

Minister during the Liberal governments of the early twentieth century,
who suggested the "need of a revolution from above to prevent it
occurring from below".

There are a wide range of examples of this policy of the State

intervention in industrial relations:

1) Initially, it was a very shy intervention, aimed solely at

protecting the most disadvantaged groups (women and children).
Examples of such rules are:

- French Law concerning women working, from1841. This Law

banned certain drudgery to women.

- Spanish Law concerning children’s work from 24 July1873

(called "Benot Law", in response to its creator, Eduardo Benot). This

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Law banned hiring children under 10 years of age and limited working
time of children under 15 years of age.

- Spanish Law relating children’s hazardous work from 26

July1878. Some risky jobs were banned for children (diver, bullfighter,
acrobat, animal tamer and similar).

- Spanish Law concerning work in commercial establishments

from 27 February1912, approved during the government of José
Canalejas. It is the so-called "Law of chair”, because women were
recognised the right to a seat when they would do it standing up.

2) Over time, the regulatory state intervention became more

settled. In this respect, 1919 was an important year, basically for two
reasons:

On the one hand, we are witnessing the "constitutionalisation” of

Labour Law". The Weimar Constitution was approved in Germany. It
was the first European Constitution which, along with the rights and
freedoms of all citizens, collected specific rights for workers. Precisely
this Constitution inspired Spain's Republican Constitution from 1931,
which recognised, for the first time, labour rights as free association,
minimum wage, limiting working time and paid annual leave.

On the other hand, in 1919 the International Labour Organisation

(ILO) was also founded by the Treaty of Versailles. Since its inception, a
major international forum for discussion was created where States’
exchange experiences regarding labour issues, particularly international
labour standards and decent work. Spain is part of it as a full member.
The ILO has developed longstanding a longstanding important
regulatory function through its Conventions and Recommendations.
These legal standards, to the extent that they contain minimal nature
rights, underpin the States’ social legislation development in all kinds of
matters avoiding, thus, "social dumping".

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 3) In the twentieth century, certain political and legal events
occurred that were crucial to the emergence of Labour Law as an
autonomous branch of our legal system. Those events were, mainly, the
following:

1. – Legislation firstly recognised the contract of employment as a

contract type namely aimed at regulating labour relations. In Spain it
was recognised for the first time in the Labour Code of Primo de Rivera
from 1926.

2. – States changed their attitude to unionism and collective

rights. Consequently, unions are tolerated initially and later recognised
by laws5. The same can be said about collective autonomy (the right to
negotiate collective agreements) and the right to strike, saving the gap
marked by Nazism and Fascism6.

3. - A specialised Administration was created: the Ministry of

Labour (created in Spain in 1920), with a specific control body: the
Labour Inspection7.

4. - A specialised jurisdiction was created: the labour jurisdiction

(1908).

3. - The functions of the Labour Law.

So far in this unit, it can be concluded that the appearance of

Labour Law is the result of a legal regulation of a class conflict. The
development of a capitalist society during the nineteenth and twentieth
centuries showed the confrontation of the claim of the working class to
overcome the legal and social situation and the interest of the owners of
capital to keep the status quo unmodified.

5
In Spain through the Associations Act of 1887, under which first Spanish unions could be founded: UGT
and CNT.
6
In Spain it continued to be penalised under the Associations Act until the early twentieth century (1909
) when it was decriminalised.
7
In Spain it was established in 1908 with the birth of the Industrial Courts. Such courts were built by a
jury composed by employers and employees who judged on the facts and the judge applied the law

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 Given this social context, Labour Law arises within the conflict of
classes developing three basic functions:

1) The first is to protect the rights of workers as the weaker party

in the contract of employment, which is manifested in the recognition of
minimum, inalienable individual rights and collective rights whose
purpose is to reduce the inequality between the parties in the contract.
All of which makes Labour Law a compensating instrument and one of
the major reflections of the Social State.

2) Secondly, it plays an integrative function of the social conflict.

Labour Law creates the legal framework where opposing interests of
employers and employees in labour relations are ordered. This function
is performed by Labour Law, mainly, through the legal recognition of
the collective rights: freedom of association, collective bargaining, right
to strike and industrial actions.

3) Thirdly, it also plays a stabilising role of the economic and

political system as Labour Law allows to achieve a structural balance
between workers’ protection, the right to free enterprise, and business
freedom and employers’ managerial powers.

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