Hiring guide in Spain

What should I know about hiring in Spain?

Employing workers in Spain may be a win-win situation for companies of all sizes. When it comes to growing their workforce and expanding their operations, many companies look to Spain. Yet, it might be difficult and expensive if you are unaware of the local laws and regulations pertaining to employment in Spain. 

Every worker in Spain must have a legally binding employment contract. Such agreements must specify the length of the contract, the salary, and the number of hours worked. In Spain, businesses must pay into the social security system on behalf of their employees. 

These contributions pay for benefits like healthcare, retirement, and unemployment insurance. By knowing the critical variables involved in hiring and managing employees in Spain, you can ensure that you comply with local laws and that your employees are adequately taken care of.

Why is Spain a good choice for finding remote employees?

Spain is becoming increasingly popular as a desirable location for hiring remote workers. Due to its diverse cultural landscape, robust economy, and highly qualified workforce, Spain is an excellent option for companies wishing to grow their remote workforce. 

A substantial number of techies, engineers, and financiers are among Spain’s highly trained labour force. Spanish workers are an excellent option for remote work due to their work ethic, creativity, and flexibility. 

Businesses wishing to minimise their labour costs may want to consider Spain because of its lower cost of living than many other European countries. To further reduce costs, the Spanish government provides tax breaks to businesses that employ remote labour.

How can Native Teams help you hire in Spain?

When looking for remote employees from Spain, Native Teams can be invaluable resources due to their in-depth familiarity with the local labour market and the ability to offer advice and suggestions you would not have otherwise considered. With the support of our Employer of Record services, Native Teams can assist you in finding new employees, integrating them into your business, and ensuring that they are paid, taxed, and taken care of in line with Spanish law.

 Hire your first Spanish employee with Native Teams.

Legal requirements for hiring in Spain

Adhering to a certain set of labour laws and regulations is important to have a fully compliant hiring process in Spain. 

Legal framework

Types of employment contracts

Employment contracts in Spain are divided into several categories: indefinite contracts, temporary contracts, part-time contracts, and training contracts. 

Indefinite contracts, also known as permanent contracts, are the most common type. They provide employees with long-term stability and security because they lack a specified end date. Temporary Contracts, on the other hand, are for fixed durations and are suitable for seasonal work, specific projects, or covering for permanent employees on leave.

Part-time contracts involve employment for fewer hours compared to full-time positions. In addition, there are training contracts tailored for young individuals aiming to acquire skills and qualifications while gaining practical experience. There are two primary types: work-linked training contracts, which span from 3 months to 3 years, and contracts for professional practice, lasting from 6 months to 1 year.

Content of an employment contract

Employment contracts may be written or verbal. However, certain contract types, such as temporary, part-time, and special labour relations (e.g., those for lawyers and executives), must be documented in writing. 

Regardless of the format chosen, if the duration of employment exceeds 4 weeks, the employer is obligated to provide written details within 2 months from the commencement date. 

These details include the identities of both parties, the start date, and, for temporary contracts, an estimate of the contract’s duration. Additionally, the contract should specify the job group or category, work location, base salary, any additional compensation or benefits, working hours and schedule, total number of holidays, notice period upon termination, and reference any applicable collective bargaining agreement.

Download a free employment contract for Spain through Native Teams.

Oral, written or electronic employment contracts

Under Spanish labour law, oral contracts allow agreements to be established verbally. However, certain terms, such as probation periods or supplementary-hours agreements, must be documented in writing.

Written contracts, while not mandatory for all types of employment, are required for specific employment relationships according to Spanish law. These include indefinite-term contracts, definite-term contracts, temporary employment agency contracts, part-time contracts, and agreements with remote workers.

Although Spanish law does not explicitly recognise electronic employment contracts as a distinct category, written contracts can be executed electronically if they adhere to legal requirements for authenticity and integrity.

Probationary period

The duration of probation periods is set by law, with maximum limits determined based on employee qualifications and the size of the company. For example, highly skilled technical staff may have a probation period of up to 6 months, whereas other employees typically undergo shorter periods ranging from 2 to 3 months.

Working hours

Employees work a standard 40-hour workweek. The allocation of working hours throughout the week is commonly determined by employment contracts or collective bargaining agreements.

Breaks and night work

Workers are entitled to a minimum 15-minute break for every 6 hours worked. Moreover, if the workday extends beyond 6 hours, a longer break, typically ranging from 30 minutes to 1 hour for meals, is mandated. Nighttime work is defined as work conducted between 10 PM and 6 AM. 

Annual leave

Full-time employees are entitled to 22 working days (equivalent to 30 calendar days) of paid vacation time annually. Workers enjoy the flexibility of utilising their annual leave either continuously or distributed throughout the year. However, Spanish labour regulations stipulate that at least one holiday period must span a minimum of 2 weeks.

Public holidays

Spain typically observes approximately 14 public holidays annually, encompassing both national and regional commemorations. National holidays include New Year’s Day, Epiphany, Good Friday, Labour Day, Assumption Day, Hispanic Day, All Saint’s Day, and more. 

Salary

In Spain, the minimum NET salary is €1,323 per month, and the minimum wage per hour is €8.87. The gross salary amounts to €2,250 per month or €27,000 per year.

To calculate the salary in Spain, click here.

Sick leave

For non-work-related illnesses or accidents, employees do not receive compensation for the initial 3 days of leave. From the fourth to the twentieth day, they receive 60% of their contribution base, which increases to 75% from the twenty-first day onward. 

In cases of work-related accidents, employees are entitled to receive 75% of their contribution base from the first day of absence.

Maternity leave

In Spain, employees are entitled to 16 weeks of maternity leave, with an additional 2 weeks for each additional child in the case of multiple births. This period must be taken consecutively and is distinct from any leave for medical examinations or health risks during pregnancy. 

At least 6 weeks of this leave must be taken immediately following the birth, but the mother may choose to commence her leave before the birth.

Paternity leave

Starting January 1, 2021, the duration of paternity leave in Spain has been extended to 16 weeks, matching the duration of maternity leave. 

Paternity leave is applicable solely to the parent who didn’t give birth. In cases of adoption or fostering, the parents can decide which of them will take paternity leave. Part-time employees are entitled to the same duration of leave as full-time workers. However, single parents cannot combine maternity and paternity leave.

Methods of employment termination

Termination of employment can take various forms, each carrying distinct legal consequences. The main methods of termination encompass mutual agreement, resignation, dismissal, and expiration of the contract.

The mutual agreement entails both the employer and the employee consenting to terminate the employment relationship. Typically, this process involves negotiating a severance package and mutually agreed-upon terms and conditions. 

Resignation occurs when an employee voluntarily chooses to leave their job. Contracts can also end upon their natural expiration, such as the completion of a fixed-term or specific project contract.

Ordinary dismissal by employer

Dismissal presents the most intricate form of termination and can be categorised into disciplinary, objective, and collective dismissals. Disciplinary dismissal arises from severe misconduct by the employee, such as repeated absenteeism, insubordination, or contract breaches. 

Objective dismissal is based on concrete reasons such as economic, technical, organisational, or production-related factors. Collective dismissal occurs when a significant number of employees are terminated within a 90-day period due to economic, technical, organisational, or production-related reasons.

Notice period and challenging the dismissal

Spanish legislation mandates minimum notification periods for termination, which vary depending on the type of dismissal. 

There’s no statutory notice period mandated for disciplinary dismissal, but collective bargaining agreements or individual employment contracts might specify otherwise. When it comes to objective dismissal, employers are obligated to furnish a written termination notice at least 15 days before the dismissal becomes effective. 

For collective dismissals, the employer must initiate consultations with employee representatives spanning from 15 to 30 days. Employees who perceive their dismissal as unjust or inequitable have the right to contest it in a labour court within 20 working days of receiving notification.

Rights and obligations of unemployed individuals

The unemployment support operates through two main levels: full protection for those who have completely stopped working and partial protection for individuals experiencing a reduction in hours and corresponding pay.

At the contributory level, eligibility is based on having contributed to the Spanish social security system for a minimum of 360 days within the past six years. The amount and duration of benefits correlate directly with the individual’s contributions.

Additionally, the social care level offers assistance to specific groups, including those who have exhausted their unemployment benefits, individuals over 45 years old without family responsibilities, returning Spanish migrant workers from non-European Economic Area countries, and those over 52 years old who meet certain criteria.

To qualify for unemployment benefits, individuals must meet several criteria: they must be registered in the social security system, have worked and contributed for at least 360 days in the past six years, be over 16 years old but not yet at retirement age, and be actively seeking employment while being open to suitable job offers.

Severance pay

Unfair dismissal, when unjustified, employees get 33 days’ salary per year worked, capped at 24 months’ pay. Objective dismissal, due to economic or technical reasons, gives 20 days’ salary/year worked, capped at 12 months’ pay. 

Disciplinary dismissal typically doesn’t offer severance pay unless deemed unfair by a court. In such cases, compensation follows unfair dismissal terms.

Prohibition of competition

There are non-compete clauses, non-solicitation clauses, and exclusivity agreements in Spain.

Non-compete clauses prevent employees from working for competitors. In Spain, these apply both during and after employment.  While not specifically regulated, non-solicitation clauses generally prevent employees from soliciting the employer’s clients or staff after leaving the company.

Exclusivity agreements require employees to focus solely on one employer during their employment and must be compensated, usually 20-25% of the employee’s salary.

Remote working policy

Remote work must be agreed upon voluntarily and in writing by both employer and employee, either in the initial employment contract or later. A remote work agreement must outline the provided equipment, expense reimbursement, working hours, on-site and remote work proportions, assigned workplaces, and termination notice period.

Remote workers have the same rights as office workers, including pay, working hours, job security, promotion, and training.

Intellectual property rights

Intellectual property (IP) created by employees during their employment typically belongs to the employer. This includes inventions, semiconductor designs, industrial designs, copyright works, and computer programs.

Health and safety at home

Remote employees are entitled to the same health and safety protections as on-site employees, including a safe and ergonomic workspace free from risks to their physical or mental health. 

Employee data privacy

Employers must inform employees about the processing of their personal data, including its purpose, legal basis, and duration. Employees must also be informed of their rights to access, correct, and delete their data. The Spanish Data Protection Agency (AEPD) oversees compliance and handles complaints.

What are the advantages of hiring employees from Spain vs other countries?

Spain offers access to a competitive business environment with relatively lower labour costs than other Western European countries. This can be advantageous for businesses looking to optimise their operational expenses without compromising on the quality of talent or services.

The country’s membership in the European Union ensures adherence to EU regulations and standards, which can simplify cross-border business transactions and regulatory compliance for companies operating within the EU market.

Culturally, Spain shares similarities with many other European countries, particularly in terms of work ethic, communication styles, and business practices. This cultural compatibility can facilitate smooth integration and collaboration.

Why use Native Teams for hiring in Spain?

Native Teams lets you employ team members ‘like a local’ meaning you get all the benefits of a global team, wherever you are based. Here are the reasons why you should use Native Teams for hiring:

• No paperwork: We will handle all the necessary paperwork for you.
• Save on taxes: We help you handle your taxes.
• No company set up: You can expand your business using our company entitles.
• Online onboarding: We’re here to ensure your onboarding process is trouble-free.
• No accounting: We will handle all of your accounting needs, including invoicing, payroll, and more.
• Increase your profit: We assist you in growing your business and maximizing your profits.
• Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
• Local support: We can assist you in understanding and complying with the relevant local laws.