The High Court of Justice of the Basque Country has ruled that a worker in Bilbao can keep receiving state unemployment benefits for people over 52 while working under a full-time permanent contract.
The decision by the regional court's social chamber revokes a previous aid suspension imposed by Spain's State Public Employment Service, known as SEPE, and recognizes the worker's right to combine the benefit with full-time wage employment starting from April 24, 2024.
The dispute began after the worker was granted the monthly financial assistance for unemployed individuals aged 52 and over on April 8, 2024. Fourteen days later, on April 22, 2024, he signed an indefinite, full-time employment contract with a company.
Before accepting the position, the recipient had checked the official website of the employment service. The online guidance stated that jobseekers over 52 could combine the subsidy with wage employment provided they secured a full-time contract that was permanent or lasted longer than three months.
On April 24, 2024, the employee visited a public employment office to report his new job and request formal approval to receive both his wage and the benefit. However, the agency immediately denied the request and suspended his financial assistance on the same day.
SEPE denial and lower court ruling
Employment officials justified the refusal by arguing that combining the subsidy with full-time work was only permitted if the employment contract was part of a specific government job creation scheme. Because the worker held a standard indefinite contract outside such a framework, SEPE deemed his employment incompatible with state aid.
The worker challenged the suspension in court, but Social Court Number 3 of Bilbao rejected his lawsuit in October 2025. The lower court supported the position of the employment service, finding that the worker lacked the required connection to an official employment promotion program.
High Court ruling on Law 45/2002
The Social Chamber of the High Court of Justice of the Basque Country overturned the lower court decision in ruling 955/2026, issued on April 23, 2026. The judges concluded that the fifth transitional provision of Law 45/2002, which was active at the time of the event, functions in itself as an employment promotion scheme specifically created for jobseekers over 52 years of age.
In their assessment, the magistrates noted that the legislation explicitly defines itself as a program and connects directly to regulations allowing older workers to combine benefits with wage labor. The court determined that older jobseekers represent a vulnerable group with unique difficulties entering the labor market, meaning the legal requirement for an employment scheme had been satisfied all along.
SEPE operates as the national public agency responsible for managing unemployment benefits and employment policies across Spain. In the Spanish social security system, the subsidy for people aged 52 and over provides vital monthly income support to older long-term unemployed individuals until they reach retirement age, helping maintain their pension contribution records.
The high court upheld the plaintiff's appeal and ordered SEPE to abide by the declaration, officially restoring his entitlement to receive the subsidy alongside his salary retroactively to April 24, 2024. The judicial panel decided not to award legal costs to either party.
