Rants from the Ballmer Peak 
In Spain they can force you to work without payment for more than a year
NOTA: Este artículo es una traducción del original en Español.
NOTE: This is a translation of the original article in Spanish. Beware, its context is very specific to Spain, may not apply to you or your situation at all.
The normal life of an ant
If one turns on the TV at any point in time, in a program about economy, you get the feeling that workers are some kind of tyrants who dominate Spanish firms, dictating unilaterally and at their whim stupid rules like reducing working hours, having paternity leaves, or even getting paid for extra hours. However the law favours firms in many cases, and this article will explain how easy it is for some entrepreneurs to decide whether to pay or not at all their employees. In particular, following the law to the letter, it is possible that an employee may not receive their wage for more than a year. Everything told here is my personal experience, I'm not speaking from hearsay.
In Spain the two most popular types of work are employed (currito) and self-employment (autónomo). Self-employed workers have less rights and work security than employees, after all you become a sort of uni personal firm, an entrepreneur starting from scratch. I was self-employed for 7 years and decided to come back to the life of the employee, simply because I won't get rich through work, so at least I could enjoy life without wondering if I'll get paid next month, right? (let's leave civil servants for another article).
Chance led me to join in 2018 the firm Wave App, S.L (CIF B86942901). A small firm run by Luis Gelado Crespo and Manuel De La Esperanza Fernández-Palacios. I still remember fondly the work interview, during which they asked me what it is that I would expect from the firm and I answered: "To be paid by the end of the month". After a short silence everybody burst in laughter at the idea. As if I didn't have a crystal ball, or didn't come traumatised from previous jobs.
Be it crystal ball or not, four years later, in April 2022, the firm Wave App, S.L closed down, and nearly the whole staff was hired by GEO DATA BLOCK, SL (CIF B86543980). This firm was run by Luis Gelado Crespo and Manuel De La Esperanza Fernández-Palacios. It is thus the typical strategy of changing ship before the former one sinks, and if there are pending debts from IRS, or some unwary investor, they can fight with the shipwreck at the bottom of the sea. They even added a clause to my contract maintaining my seniority from 2018. Looks good.
Finally, GEO DATA BLOCK, SL was burnt too and only two years later, in July 2024, my job was transferred to GEODB BLOCKHAIN LIMITED with CIF N0024315D. Can you guess who ran the firm? Indeed, Luis Gelado Crespo and Manuel De La Esperanza Fernández-Palacios. The problem was that precisely since July I didn't get paid any more. And I was finally sacked the 10th of December of 2024 for performance reasons (the previous month the norm for performance dismissals was changed to require a previous audience with the employee so they can defend themselves, which didn't happen). Without severance pay, without salary, nothing, since I was there working for free since July for the firm. But I must not have worked too bad for them during those five months, for them to drag their feet sacking me for performance reasons.
Modus operandi
They say that people in Spain don't innovate enough, however Luis Gelado Crespo and Manuel De La Esperanza Fernández-Palacios are pioneers with their greatest innovation: the self-employed employee. On paper, they first create a firm, search for investors and start employing people for a job. These people usually get paid monthly as employees. After a while, that idea or project fails, and they search for more investors. But if they don't find investors to sell them their bridge, salaries aren't paid. Thus begins the self-employed period for employees.
The creation of this hybrid between employee and self-employed is most unfavorable to the workers. As an employee, the worker is paid a salary regardless of the firm's performance. On the other hand, if the firm gets rich, they still pay the employee the same amount even if they are swimming in abundance. The self-employed, on the other hand, work for a result, for the coin. So if there is no coin, at first notice they go away and search for coin elsewhere. It is this point that differentiates the self-employed employee: if there are no benefits, they don't get paid, but they are still tied to the same job. They can't leave, they can only flounder.
And periods of floundering happened several times in my six years across the three firms. At some point I believe we reached between 20 and 30 employees, reduced to only two when I stopped being paid. The famine periods were frequent. Sometimes they lasted a few weeks, but sometimes they reached several months (and their accumulation). For me these were clearly purges of unwanted workers. By not paying the employees, the employer is dismissing them without the need to pay for severance, since due to not being able to eat, the employees will leave by themselves and search for better luck at a different firm. A worker that leaves due to necessity most likely won't get paid the pending salaries or severance pay, and will be too worried about making ends meet to entangle themselves with suing the company for the earned but missing money.
And what happens if a worker (like me) stays and doesn't go away? Well… the worst case is they get paid their salaries. In other words: there is no difference for the employer to pay you now or with a delay of 60 days. You still are required to do your job. If you don't and stop working, you get a performance dismissal. And this is most likely the reason to stop paying, to sack without paying severance.
I believe there were at least two big meetings between the staff and Luis Gelado Crespo and Manuel De La Esperanza Fernández-Palacios, once for Wave App, SL, and another for GEO DATA BLOCK, SL (at GEODB BLOCKCHAIN LIMITED we were only two idiots left, so it wasn't necessary). At these meetings the employers staged the anguish of not being able to pay salaries. Obviously everything was a lie, no anguish at all. In fact, when I stopped being paid at GEODB BLOCKCHAIN LIMITED, another employee told me he was still being paid and was working forward with another project, one which I wasn't informed of, obviously to hide the existence of incoming money. Basically, being a self-employed employee with nothing to contribute to the firm I wasn't counted any more in the firm's salary payments.
And this is the key difference between a self-employed employee and an employee. The honest firm will dismiss people and close because there's no money for anybody. However in these firms there was always somebody who brought money, and the rest had to look for their own. Ah, wait, they couldn't do so, they had to stay working for free. That I wasn't paid any more wasn't related to my performance, simply the firm had finished all the projects related to my job position, didn't have any more projects where I could collaborate, and therefore I didn't deserve to be paid. And this had happened throughout all cases where people were purged, there were chosen ones who were paid, and others weren't.
The reasons why I had stayed so far were because I was curious about the whole legal process, the salary was high (while it lasted), I wanted to see how a hypothetical firm death was lived from inside (which didn't happen, since the firm continued with other projects), and partly because since I had been self-employed I felt empathy for the lies they spewed about hardships to make ends meet, the "bosses" not earning money, etc. In fact, when I was self-employed I reached a point where to keep growing I'd have to build a firm and employ people. I didn't do it because I don't have the guts to play with the future of possible employees. I'm not made to be a psychopath boss for whom people are just a number on a result excel sheet.
Clawing back
From previous jobs I had already lived through the experience of not getting paid on time, see angry people shout and flounder, and then leave on their own foot because immediate debts were eating them alive. I did this myself a few times. But since I went through a true self-employment phase, I learned that there is nothing sure in life, and if I didn't build my own backup, my life would drift at the mercy of chance, because at the final hour nobody is going to pay your debts. Thanks to my backup, I decided to stay in these fake firms to learn all I could about the work laws and their reality.
The first thing is knowing that a contract generates debt between the employer and the employee. In Spain contracts are usually monthly, and while a specific payment day doesn't have to be stated explicitly, the repetition of salary payments several times without delay is enough to prove to a judge that payday is the 1st, the 15th, the last day of the month or whichever it is. What does this mean? Well if you always get paid the 1st and once you get paid the 2nd, you can claim as employee the interests generated by that payment delay. It's your right. They can give you stupid excuses like, we can delay up to 5 days payment, or payment day was on a non working day so it was delayed. But really honest firms pay the working day before those non working days to avoid there being delays. The maths are what they are, and it is the firm that has to do an effort to pay, not the employees who have to beg for their salary.
These delays, which could be a few days, or maybe weeks or months, are a way that employers have to finance themselves for free. Instead of reaching a bank to ask for a loan to pay you on time, they invert the situation by not paying the employee. Now it is the employee who is financing the delay, because a bank would ask for interests with the payment of the loan. Precisely during one of the worker purges mentioned before when there was below two weeks of delay in the payment, one of the employees left angry because he had to ask for loans to friends and/or family to pay his immediate debts. He left the firm, but as far as I know didn't sue the firm for the delays.
And while I believed before that this was wrong, that he had to ask for compensation, when I learned about the legal process to ask for them I realised why few are interested: they are pitiful. These interests can be claimed up until a year since they were generated. Well, I claimed all the interests generated through a full year, with some of the included salary delays spanning a few months and the total sum was… about 400€. Which is not pocket money, you could buy a mobile or some gadget. But you aren't even getting the sum immediately. Since I asked them through legal procedure until I received them in my bank, 12 months elapsed, a year. With these times and these profits, many employees calculate the amount of free time in their life they need to dedicate to go to the arbitration court first, request a claim and then go to court ask for trial, and they decide it's not worth it.
My personal recommendation is: learn to do this digitally. It's true that it's no fun at all, but if you get a personal digital certificate you can make your court claim electronically, and the only time you actually have to move physically is when you go through the initial arbitration court before the trial. This means that any lazy weekend you don't have anything better to do you could spend half hour or one hour to review your income, make some calculations and request your interests, without having to move anywhere. Of course, here's a technological barrier many workers won't be able to avoid. In fact, many workers think that it is necessary to contract a laywer (it is not). And if you are claiming just 400€, what is the lawyer going to live from.
In other words, to have a profit when you ask for salary delay interests, you need to learn to use your digital identity against public organizations, you need to learn how to represent yourself in a trial, and you need to survive those delays because you are a saving worker who doesn't spend money on stupid things like living. I suspect that these requirements explain in most cases why after more than 20 years working I haven't met yet anybody who has claimed salary delay interests. The outlook is bleak, but there is more…
The bargain of working for free
Obviously a contract has to be respected and the employee has to be paid or it should be void and interrupt the working relationship at some point. I'm not referring to leaving the job, because that doesn't give you unemployment benefits or any kind of compensation. I mean a judge should confirm that yes, you have not been paid, and therefore the contract is not valid. This is known as termination of the employment contract at the employee's will. In these cases, the judge recognises that you haven't received your salary several times and cancels the contract. You receive unemployment benefits and in addition a compensation for the years you've worked.
The first problem is that to have a judge accept that the firm is not paying, and won't be paying the employees, you are required to wait 4 months. First troubles for the employee. Do you remember that coworker who thought a delay of nearly two weeks was shameful and was on the limit? Well I don't want to imagine if he wanted to wait 4 months without getting paid. But that's not all, because while that is the period of time you have to wait to request a cancellation of the contract, now you have to wait the arbitration. Before going to trial you need to go to arbitration, and depending on the dates, you could wait between a week or a month. For example, at mid December I was looking at the dates the Madrid's Arbitration Service (SMAC), and the first date they were giving out was the 10th of January.
Now this is just the first step. If the firm doesn't want to pay, they won't even attend the arbitration, and then you can request a trial. Meaning, public services won't even bother to help you, it's you who has to go and push further. So with the certificate of the failed arbitration you can demand a trial at a court and… keep waiting. Now comes the fun part. I presented my trial demand in October 2024. One week later I received confirmation that the trial was scheduled for October 2025. And careful here: you need to stay at your job, working for free for the firm until the trial.
And the thing doesn't end here, if the judge decides that yes, the contract is void, now you have to claim to the court that the firm should actually pay you that money. This implies more waiting time, and if the firm doesn't pay on time now their bank accounts have to be locked, and if there is nothing in those account you have to reach to the Fondo de Garantía Salarial (FOGASA) … in the end, waiting one year and a half to get money is optimistic. Based on my experience with the interest, it's likely you'll wait another half year since the date of the trial. If I ever get any money back I'll update this article. At least at the time of the trial the contract is void and you can finally leave your job to get unemployment benefits and look for other firms.
In other words, an employee who wants to follow legal procedure to cancel their contract with unemployment benefits and (presumably) end up getting their due money needs to wait four months to request the contract cancellation. Then you need, let's say about two weeks for the arbitration, and finally a year for the judge to look at it. And until the trial takes place, you, as an ant worker, need to stay on your job, working and producing for the firm. Isn't it fascinating how well employees are protected against a non paying firm?
The maths behind
All this story could be solved happily at many points: the firm could pay back again their employees, either suddenly or maybe at the arbitration act. It is not necessary to reach a trial to solve this. But if an employee is not getting paid for four months, the most likely case is that the firm has decided to get rid of them and they are using the pressure of the non payment to force them leave the job without getting compensation, or the firm actually has troubles to pay and may go bankrupt.
In both cases, when a judge orders the firm to pay, either because of lack of funds or clever tax engineering, if the firm doesn't have anything to pay with the employee will reach to the Fondo de Garantía Salarial (FOGASA) to recover part of the claimed amount. And here's the final fatality: FOGASA sets limits to the quantity of money that can be claimed back. More specifically, it sets as maximum for salary payment twice the amount of the minimum national wage limited to 120 days (4 months). This means that the total limit of salary amount FOGASA will pay back is 10.534,80€.
What does this mean for an average worker? According to the National Statistics Institute, for the year 2023 (couldn't find fresher data) the average full time salary is 2.503,81€. And for FOGASA the minimum wage in 2024 is 1.134€, therefore the limit is 2268€. In other words, the average Spanish worker, in case of claiming back their salary to the FOGASA loses 235€ each month. What a fun coincidence that the limit of salary months to pay back matches the number of months an employee has to wait to request a termination of the employment contract at the employee's will!
If we presume an average salary, using as guide the time periods I obtained, I would lose 943€ during the first four months of wait. To these months we need to add another month for the arbitration and another year for the trial to reach October 2025, which totals 13 months that the FOGASA won't pay: 13 * 2.268€ = 29.484€ in lost wages to any average worker who would want to wait for the trial. Of course it could be less or more, depending how saturated courts are. My salary was above average, meaning I lose more money per month for being stupid, sorry, for believing that the law in Spain protects employees.
By the way, for compensation there are also absolute limits, which is 32.043,35€. But thanks to reductions we have accumulated, it seems hard to reach the compensation limit.
What is the true problem? Can it be solved?
Recently news were published saying the best politicians that Spain can produce will improve the conditions to request a contract cancellation. The summary of the fine print is that instead of waiting 4 months without being paid you can wait just 3 months to begin the whole process. But everything else mostly stays the same. Well, now separate delays can be accumulated to trigger the whole process, and the unpaid salaries don't have to be sequential. In any case these changes won't help me nor will be effective until at least April 2025, too late for me.
This is a clear example where politicians can easily get more votes without changing much at all. Since my first missing payment until the trial there are 17 months of wait. With the new law, it would change to be 16 moths, hypothetically. In other words, nothing much changed for the employee. But politicians can get say they fought for worker rights. Employers can say they have a heart (but they will have to cut down on other stuff though). And meanwhile you can learn to use magic to pay your rent, the water, and other essential services to live through more than a year while you are still working.
The real solution to have effective justice is for courts to have the resources to work fast. Otherwise, employees will have null protection when some courts are giving out trial dates for 2027, meaning, 2 years to see a judge, following closely the best waiting lists of healthcare. But promising that means increasing taxes or reducing the budget of another service that depends on the Government, and none of those options increases votes. And to whom belong the courts? To the Government. It is also one of those things that can't be externalized by neoliberals because the laws are imposed by the Government, therefore it is the Government who should provide the mechanism to apply those laws. Unless, of course, we reach a situation were employees will have to pay directly to the judge, and the judge won't want to leave bed for less than a specific quantity…
After showing these news to my lawyer he confirmed my suspicion: they are worth nothing. They could even modify the law so that a single unpaid salary month is enough. How would this help? First, current court saturation won't decrease. In fact, if it were that easy to obtain a trial, courts would saturate even more, since now maybe more employees would demand the law to claim their unpaid salaries. On the other hand, if we removed this law maybe nothing would change for the workforce anyway, since nearly nobody (except the most stupid and stubborn) are willing to follow a legal process that makes you lose money.
Conclusions
I'm an idiot. Don't be an idiot.
Laws are useless if the judicial system can't enforce them on time, or if following the law is going to make you lose money (by FOGASA). In tech terms, idea vs implementation.
Everybody who was telling me since the first unpaid salary to quit the job was a sage.
This article has ended up being expensive.
If you are an employer, I hope you have learned how to save even more in salaries to Make Spain Great Again through the sweat of others.
$ nim c -r justice.nim Error, tambourine country found.