Wednesday, 31 October 2012

Another reason Spain's in the mess it's in: abuse of privilege

José Manuel Vergel
SEVILLA The privileges enjoyed by José Manuel Vergel, former executive of Empresa Pública de Suelo de Andalucía (EPSA, the Junta's housing management organization) included a company car, cleaned, fueled and pristine, every Friday. It went back to the company on Monday, empty. This, and a lot more, was not included in his contract and has now resulted in him being charged in court. He and three other top EPSA executives are also accused of a variety of similar charges. The four allegedly received 'privileges of doubtful legality and morality', finding loopholes in labour laws that allowed them to be paid excessive amounts of money. They were dismissed in July and have in turn denounced EPSA for breach of contract, something denied by the Junta, which had requested them to return salaries and expenses. This matter went to an arbitration court in Sevilla but came away inconclusively  There is a fifth executive who could also be in court with his former colleagues.COMING SOON:SUBSCRIPTION INFORMATION

During Verger's reign, EPSA was one of Andalucía's more opaque enterprises, where a much sought-after job even at mid-level, was viewed as an opportunity to make money. Allegations -but not formal charges until now- have been flying about for decades.

No selection procedure 'a habitual practice'
One of the more salient cases is that of José Manuel Vergel, who joined the public company without any prior selection procedure as Director of Human Resources. The mediation documents reveal that 'it has been a habitual practice for a long time that top posts lacked objective criteria and were reserved essentially for people of political affinity'. In other words, you wouldn't have a chance of a job if you belong to a party that is not in power or coalition. (See Another reason Spain is in the mess it's in: political affinity)

Vergel's arrival at EPSA has much to do with his 'close personal and political relationship' with the company's then Managing Director, Jorge Cara, who headed the organization from 2007 to 2010 and had been in the top echelon since 2004. In June, Cara was named Secretary General of the Junta's Council for Education, headed by Mar Moreno (PSOE).

Both men occupied leading positions in the PSOE at Roquetas del Mar, in Almería.

Some of the accusations against Vergel:
  • September 2007: he 'orders' creation of his own indefinite employment contract back dated to December 2006, with seniority valued at €1,285.
  • That contract includes a clause that establishes the need to travel to Sevilla from his family home in Almería for which he is to receive €7,000 a year.
  • A year later, he orders that he should receive housing benefit for his home in Almería, which from 2007 to 2012 amounts to €53,073. (The Junta says this is 'absolutely fraudulent' as he has a home in Sevilla.)
  • The Junta accuses Vergel of creating the above benefit just before a law came into effect that forbids people in his position to receive emoluments of more than the President (of the Junta) receives as salary: €68,981.
  • All in all, the position, such as Vergel's, climbed from a salary plus expenses, benefits, etc., of €55,977 as a mid-level executive, to €78,179.
  • He is accused of 'professional negligence' in defending the interests of the company. At the time, EPSA lost two cases against two former executives, Manuel León and Antonio Barrios, and Vergel is allegedly to blame for the strategy, which, according to mediation documents, was designed to 'deviate possible later judicial procedures.'

The three other executives who are demanding indemnization for wrongful dismissal are José María Salas, ex PSOE mayor of La Guardia, in Jaén, Federico Salmerón, ex head of EPSA's Department of Urban Rehabilitation and Renovation, and Antonio López Jiménez, a personal friend of Jorge Cara.

EPSA is now under the direct control of the Junta's Council for Housing, which has made 30 mid-level redundancies, leaving another 68 in their posts. The Housing Council is run by IU (Izquierda Unida), which is in coalition with PSOE, in an agreement that kept the PP out of office at last year's regional elections.

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