Employing in Spain

Employment in Spain is governed principally by the Statute of Workers, which offers robust worker protections and compels companies to pay close attention to detail. Collective bargaining agreements, also known as convenio colectivo, regulate labor norms by job type, such as legal compensation range, working hours, and vacation days, and have a significant impact on the working conditions of employees.

Since employment is extensively regulated in Spain, valid employment contracts are a need for businesses. As your employer of record and PEO in Spain, we can ensure that each employee’s contract is compliant with all regulations. In addition to advising you on cultural norms and hiring best practices, we can also keep you abreast of evolving employment laws.

Employer of Record Spain – Spanish employment contracts

As you want to hire employees in Spain, here are some basic regulations you’ll need to be aware of in order to draft a compliant contract, as well as how an employer of record and PEO can assist with your unique HR requirements.

Working hours Employment contracts must include the maximum number of hours an employee is permitted to work. Collective agreements may limit the number of working hours allowed, although the Statue of Workers permits no more than 40 hours per week on average, and no more than nine hours per day.


Consider the following when determining the suitable wage to give new employees:

In May 2022, the minimum wage is €1,125.80 per month.

Collective agreements may govern the permissible salary range

As your legal employer in Spain, we can supply you with resources and information regarding employee compensation, allowing you to build a more competitive employment offer.


Employees in Spain are entitled to two additional payments every year, in addition to their regular income. It is possible to structure employment contracts so that employees receive their two extra payments on a pro rata basis throughout the year, but they are commonly delivered at Christmas and before summer vacation.

Initial trial period

A two- to six-month probationary period may be stipulated in an employment contract.

Dismissal and severance

In Spain, the termination of an indefinite employment contract must be justifiable; otherwise, you may be compelled to reinstate the employee or pay severance and damages.

Employees who have been terminated unfairly, meaning there is insufficient proof of the cause of termination or the reason does not justify termination, are entitled to:

severance pay equal to 33 days of income for each year of work, up to a maximum of 24 months, or reinstatement.

Six hours of paid leave every week throughout the notice period to locate new employment

As your employer of record in Spain, we can work with you to rapidly handle the unanticipated termination of an employee, giving legal counsel and a customized procedure to help you avoid labor court.

Spain offers employee benefits like paid leave.

Here are some statutory benefits and paid leave obligations to bear in mind when negotiating an employment contract with a candidate in Spain, as well as how an employer of record can enhance your company’s benefits plan.

parental leave

Pregnant workers are eligible for 16 weeks of maternity leave, plus two additional weeks per child for multiple births. During maternity leave, the social security system pays 100 percent of the employee’s social security contribution basis.

Employees can request a suspension of their job contract for up to 15 months to provide child care, and employers must reserve their position until they return.

Employees are entitled to a minimum of 30 days of paid leave per year, which may be enhanced by collective agreements or individual employment contracts.

If an employee’s holiday period coincides with a temporary handicap like pregnancy, childbirth or breastfeeding, the employee is eligible to take paid vacation at another time during the same year.

Holidays Eight holidays are observed nationwide:

December 31st

Good Friday

International Workers’ Day \sFeast of the Assumption

Spanish National Day

All Saints’ Day

Spanish Independence Day

The Christmas holiday

Employees are eligible to 14 annual public holidays, including all eight national holidays, four regional holidays, and two local holidays. The Spanish government may choose to observe weekend vacations on the following Monday.

Illness leave

In the event of a work-related illness or injury, commencing on the second day of absence, the social security system pays 75% of the employee’s monthly compensation.

Employees are entitled to 60% of their monthly salary beginning on the fourth day of absence for non-work-related illness or accident. On days four through fifteen, the company pays benefits equal to sixty percent of the employee’s monthly wage, while the social security system covers days 16 through twenty. The social security system pays payments of up to 75% of monthly salary beginning on day 21.

Collective agreements may include supplementary benefits that compel the company to pay the difference between the employee’s income and the social security allowance.

Health insurance

The health insurance for Spanish employees is covered by social security, although some professionals, particularly executive staff, frequently request additional health and life insurance or an allowance in place of additional coverage.

INS Global being your Global PEO in Spain, we may be able to offer professionals and their dependents optional supplementary medical insurance at a more affordable rate.

Additional advantages

In addition to medical treatment, the Spanish social security system finances a variety of other benefits, including workers’ compensation, hospitalization, retirement pensions, disability payments, and unemployment benefits.

Employer social expenditures will cover a significant percentage of employee benefits in Spain, but we can discuss other coverage choices, such as additional pension contributions and life insurance, if necessary.


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