Guide to employment, payroll and benefits in

Spain

Rivermate offers complete payroll, benefits and compliance services for

Spain

01. Overview

Last updated: 

August 19, 2021

Currency
Euro
Capital
Madrid
Ease of doing business
77.9
Language
Spanish
Population
46754778
GDP growth
3.05%

02. Grow your team in

Spain

with Rivermate

Payroll, benefits, taxes, and compliance can be difficult to manage in

Spain

, particularly if you don't have established local relationships. You can hire employees in

Spain

effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global employment solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

03. Summary

Spain, officially the Kingdom of Spain, is a country in southwest Europe with some territories straddling the Gibraltar Strait and the Atlantic Ocean. The Iberian Peninsula is where it has its continental European territory. The Canary Islands, off the coast of North Africa, and the Balearic Islands, in the Mediterranean Sea, are part of its territory. Spain is the only European country with a physical boundary with an African country, thanks to the African exclaves of Ceuta, Melilla, and Peón de Vélez de la Gomera. A number of small islands in the Alboran Sea also fall under Spanish jurisdiction. The Mediterranean Sea borders the nation to the south and east; France, Andorra, and the Bay of Biscay to the north and northeast; and Portugal and the Atlantic Ocean to the west and northwest, respectively. Spain is the largest country in Southern Europe, the second-largest country in Western Europe and the European Union, and the fourth-largest country on the European continent by population, with a total area of 505,990 km2. Spain is the sixth most populous country in Europe and the fourth most populous country in the European Union, with a population of over 47.3 million people. Madrid, Spain's capital and largest city, is joined by Barcelona, Valencia, Seville, Zaragoza, Málaga, Murcia, Palma, Las Palmas de Gran Canaria, and Bilbao as major cities. Around 42,000 years ago, anatomically modern humans first arrived in the Iberian Peninsula. Various cultures evolved in the area, including Phoenician, Greek, Celtic, and Carthaginian, as a result of migration and settlement. By 206 BC, the Romans had defeated the Carthaginians and split the Iberian peninsula into two administrative provinces, Hispania Ulterior and Hispania Citerior. Spain remained under Roman rule until the fourth century, when the Western Roman Empire fell apart, allowing Germanic tribal confederations from Central Europe to take over. By the fifth century, the Visigoths had established themselves as the dominant force, with their empire covering most of the peninsula. The Umayyad Caliphate invaded the Visigothic Kingdom in the early eighth century, ushering in over 700 years of Muslim rule. During this period, Islamic Spain grew to be a major economic and intellectual hub, with Cordoba being one of Europe's largest and wealthiest cities. Several Christian kingdoms arose in Iberia's northern reaches, the most notable of which were León, Castile, Aragon, Portugal, and Navarre. An periodic southward expansion of these kingdoms over the next seven centuries—metahistorically described as a reconquest, or Reconquista—climaxed in 1492 with the Christian takeover of the last Muslim polity, the Nasrid Kingdom of Granada. In the same year, Christopher Columbus set sail for the New World on behalf of the Catholic Monarchs, whose dynastic union of Castile and Aragon is often regarded as the birth of modern-day Spain.

04. Public holidays

05. Types of leave

Paid time off

At least 30 days of paid time off are required.Employees are guaranteed at least one and a half days of undisturbed relaxation each week. Sunday must, in general, be included.

Public holidays

The number of public holidays in Spain varies by province, although they do not exceed 14 in total. There are 9 national holidays among them 14.

Sick days

Sick leave is as follows:The first 3 days of sick leave are unpaid.From the 4th to the 15th day, the employee is entitled to 60% of the contribution base of the previous month and is paid by the employer.From the 16th to the 20th day, the employee is entitled to 60% of the contribution base of the previous month and is paid by the employer, who can then deduct the amount from the social security mandatory payment.From the 21st day onwards, the employee is entitled to 75% of the contribution base of the previous month and is paid by the employer, who can then deduct the amount from the social security mandatory payment.Employees can take sick leave for up to one year and under unique circumstances could extend it to 180 days.When the employee is injured at work- The employee will be entitled to 75% of the contribution base of the previous month’s salary. It is paid by the employer, who can then deduct the amount from the social security mandatory payment.Safety and risk prevention traininga. All employees must complete online training (main topics: exposure to occupational risks, the proper environment at the workplace, ergonomics and other good practices, etc).b. After the first certification, a refresher course will be required every 4/5 years.c. All training costs will be endured by Baldock2. Annual medical checkupa. All employees are required to have an annual medical checkup. Each employee will be able to schedule the medical appointment from across hundreds of locations in Spain; contact information for each of these locations is available on the provider’s website.b. Each medical checkup will cost €50, and must be covered by the employer. So these costs will be included in our invoice when applicable (if further consultation or procedures are needed, this may incur additional costs).Important notice:As this is a strict legal requirement, there are no exemptions and failure to follow the above rules will:Risk incurring a €4,000 fine per employee covered by the employer and when applicable included in our invoiceJeopardize the employee’s insurance coverage in the event of a labor accident or a professional diseaseLead to potential loss of the employee’s rights to social payments applicable under sick leave in case of a labor accident or a professional disease.

Maternity leave

Maternity leave is granted to mothers for a period of 16 weeks. The leave can start up to four weeks before the projected due date, and it must last at least six weeks after the child is born.During maternity leave, the employee is paid a maternity benefit rather than their wage. The maternity benefit is computed and provided by social security based on the previous month's contribution (including monthly income and the proportional share of the extra pay).The monthly maternity benefit is restricted at 4,070 EUR. The employer can choose to pay the difference if the employee's wage is normally more than this amount; however, this is not required.

Paternity leave

Paternity leave is paid for 16 weeks for fathers. The first six weeks must be taken as soon as the infant is born. In the case of multiple deliveries, leave might be extended by two weeks. The state pays for the entire 16-week period.

Parental leave

Employees have the right to take up to three years off to care for their children, whether they are biological, adopted, or being fostered permanently or as part of a pre-adoption program. Female employees have the right to take one hour off every day to nurse a child under the age of nine months. This may be broken down into two half-hour segments.Beginning January 1, 2020, leave will be increased to 16 weeks, with the first six weeks being uninterrupted. Neither parent has the ability to transmit this right to the other.

Other leave

Adoption Leave: 6 weeks compulsory and uninterrupted leave for both partners. 16 unpaid weeks in total can be shared between both parents. A maximum of 10 weeks can be taken by one with the remaining 6 weeks being taken by the partner.Marriage: 15 calendar days Serious illness or injury of family member: 2 days (4 days if travel is required). Bereavement: 2 days (4 days if travel is required) for the death of a family member. Moving: 1 day for moving to a new house.

06. Employment termination

Termination process

The employer's and employee's rights and obligations in connection with the termination of the employment relationship primarily depend on the form of termination and the provisions of the individual or collective agreement. Employment contracts may be terminated mutually, at the end of the contract period (if it is a fixed-term temporary contract), by the employee, or by the employer for objective, economic, or disciplinary grounds. Individual and collective bargaining agreements may stipulate the circumstances under which an employment relationship will cease.


Fixed-term contracts terminate when the parties agree on an expiration date or when the service is completed. Employees are entitled to compensation of 12 days' wages per year worked at the end of a fixed-term contract. If the temporary contract is longer than one year in duration, the party canceling the contract must give at least 15 days notice.


Employees can end their employment relationship by quitting, either freely or involuntarily, or by abandoning their job, or by being fired for cause. When an employee is let go for cause, he or she is entitled to compensation equal to 33 days of salary for each year of service plus "finiquito."


Employers may remove an employee for any of the objective grounds specified in the Workers' Statute, including employee incompetence, failure to adapt, collective dismissal, or absences from work. Employers must present an employee with a termination letter that details the reason for the employee's dismissal and the date of the employee's final day of employment. Employees are entitled to 15 days' notice and compensation, often known as indemnification. Compensation is 20 days' salary each year of service, up to a maximum of 12 months, at the moment notice is given. Employers may also grant compensation in place of notice.


Employers have the authority to discipline an employee up to and including dismissal for a variety of reasons, including repeated unexcused absences, disobedience, physical or verbal abuse directed at the employer or a coworker, or sexual harassment. The dismissal must occur within 60 days of the employer being aware of the conduct and within six months of the incident. In this case, no remuneration is required, and the employee is not entitled to notice of termination. However, if the employee is a union member, the employer is required to notify the union.

Notice period

Employers are required to provide 15 days' notice, and if notice is not provided, payment in lieu of notice shall be made.

Severance pay

Employers should compensate employees with 20 days of salary per year of service, up to a maximum of 12 months. If a judge rules that the dismissal was unjust (i.e., without cause), the employer may reinstate the employee or make a statutory severance payment. Employees who are laid off are entitled to a legal severance payment and written notice of the contract's termination in advance. Severance pay is not payable to an employee who is terminated for disciplinary reasons.

Probation period

The probationary period varies depending on the Collective Agreement in place at the company. The common practice is two months, but graduate technicians are usually probed for a 6 month period.

07. Working hours

General

In Spain, working hours are generally determined by individual or collective bargaining, but cannot exceed 40 hours per week on average over a year. In the absence of an agreement specifying how irregular work hours will be scheduled, the employer may allocate a maximum of 10% of working hours throughout the year. Working hours are generally limited to nine hours per day, unless otherwise agreed upon collectively or individually.

Overtime

Collective bargaining agreements typically cover overtime policies. Overtime hours should not exceed 80 hours per year, as specified by law.


Overtime can be compensated by paying a higher rate than the employee's salary or by substituting an equivalent paid rest period for the hours worked.

08. Minimum wage

General

For full-time workers, the monthly minimum salary is 950.00 EUR, or 7.04 EUR per hour.

09. Employee benefits

General

Social security taxes are used to finance health insurance. An employer may offer supplemental health insurance to an employee as a perk. Most executives seek additional health and life insurance, and a small firm may provide a stipend in place of obtaining insurance.

Employees are given 15 days (including weekends) to marry, 2 days to mourn the loss of a family member, and 1 day to relocate.

10. Why Rivermate as your Employer of Record / PEO?

Establishing an entity in

Spain

to hire a team takes time, money, and effort. The labor law in

Spain

has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into

Spain

simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record solutions in

Spain

give you peace of mind so you can focus on running your business.

Please contact us if you'd like to learn more about how Rivermate can help you hire employees in

Spain

via our Employer of Record / PEO solution.

Ready to get started? Our friendly staff is ready to assist you with all your questions, let's connect.