Employer of Record
COVID-19 status update
As the situation in Spain continues to develop, Safeguard Global will be providing in-country intellect to our clients regarding legislative changes affecting employees and impacting businesses, as well as government recommendations on how to keep employees safe and healthy.
As of today, we have not identified any disruption that will impact our ability to provide the service our clients expect. Learn more in our COVID-19 Resource Center.
If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in Spain, an employer of record may be the best option for achieving your global growth objectives.
An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in Spain―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.
Learn about the hiring, employment, and benefits requirements for workers in Spain and how our employer of record service, Global Employment Outsourcing (GEO), and local HR experts can help you manage your international employment needs.
Hiring in Spain
Spanish labor law has strong worker protections, which require great attention to detail. Collective bargaining agreements, known as the convenio colectivo, regulate labor standards by job type like, legal salary range, working hours and vacation days, and they have a big impact on the terms and conditions of employees at work.
Since employment in Spain is highly regulated, compliant employment contracts are an essential business need. As your employer of record and PEO in Spain, we can ensure that every contract, for every worker, meets all requirements. We can also provide you with guidance about cultural norms and hiring best practices and keep you up-to-date with employment regulations as they change.
Employment contracts in Spain
As you look to hire employees in Spain, here are some common regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs.
Employment contracts will need to address the maximum allowable working hours for employees. Collective agreements may limit the number of working hours allowed, but generally, Spanish employees will expect a 40-hour workweek.
As you consider the appropriate salary to offer new employees, keep in mind:
- Minimum wage is 31.66 euros per day, 950 euros per month, or 13,300 euros per year.
- Collective agreements may regulate the legal salary range.
- Salary is often lower in Spain than in northern Europe and the U.S.
- When making a salary offer, make sure you quote a gross annual salary, sueldo en bruto, rather than a net salary.
As your employer of record in Spain, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.
Spanish employees are entitled to two extra payments a year—in addition to their annual salary. Employment contracts can be made for an employee’s two extra payments to be issued on a pro rata basis throughout the year.
A probation period of two to six months may be agreed to in an employment contract.
Termination and severance
For an indefinite employment contract, termination in Spain must be justified or you may be required to reinstate the employee or pay severance and damages.
Employees unfairly terminated, meaning there is inadequate proof of the cause of dismissal or the cause does not justify dismissal, are entitled to:
- Severance compensation equal to 33 days of salary for each consecutive year of employment―up to 24 months
- Six hours of paid leave per week during the advance notice period in order to find a new job
As your employer of record in Spain, we can work with you to quickly handle the unforeseen event of an employee termination, providing legal guidance and a personalized process that ensures you stay out of labor court.
Employee benefits and paid leave in Spain
When negotiating terms of an employment contract with a candidate in Spain, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.
Pregnant employees are entitled to 16 weeks of maternity leave and two extra weeks per child if there are multiple births. The social security system pays 100% of the employee’s social security contribution base during maternity leave.
Employees can request a suspension of their employment 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 annual paid leave, which can be increased by collective agreements or individual employment contracts.
If an employee’s holiday period coincides with a temporary disability—like pregnancy, childbirth or breastfeeding—the employee is entitled to take paid vacation at another time within the same year.
Eight holidays are observed nationwide:
- New Year’s Day
- Good Friday
- International Workers’ Day
- Feast of the Assumption
- Spanish National Day
- All Saints’ Day
- Spanish Constitution Day
- Christmas Day
Employees are entitled to 14 public holidays per year, including eight national, four regional and two local holidays. The Spanish government may elect to observe holidays that fall on a weekend the following Monday.
In the event of occupational illness or accident, the social security system pays 75% of the employee’s monthly compensation.
With illness or injury not related to work, employees are entitled to 60% of their monthly wages. Many employers pay for temporary sick leave and are reimbursed by the social security system.
Collective agreements may provide additional benefits, which would require you to pay the difference between social security allowance and the employee’s salary.
Health insurance for Spanish employees is funded by social security, but some professionals, especially executive employees, often request supplementary health and life insurance or an allowance in lieu of additional coverage.
As your employer of record in Spain, we may be able to provide optional supplementary medical insurance coverage for professionals and their dependents at a more cost-effective rate.
In addition to medical care, the Spanish social security system funds numerous benefits, like workers’ compensation, hospitalization, retirement pensions, disability payments and unemployment compensation.
Employer social costs will cover a large portion of employee benefits in Spain, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance, if needed.
Employee onboarding with an employer of record in Spain
We write and validate all local employment contracts, streamlining the onboarding process for you and your Spanish employees—all you have to do is provide relevant information and review and approve the employment agreement.
As your employer of record in Spain, we will:
- Schedule a welcome call to discuss HR and employment information for Spain, as well as answer any questions
- Prepare a customized employment contract in English and in Spanish (or other local language)
- Share the employment contract and benefits information with the new employee for signature and review
- Gather tax and banking information from the employee to set up payroll
- Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll
The entire onboarding process for the employee is often completed in as little as two weeks.
Partner with Safeguard Global as your employer of record and PEO in Spain
With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on Global Employment Outsourcing (GEO) to expand and hire in over 179 countries around the world, quickly and compliantly.
We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in Spain. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.
Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations—in more than 150 countries and can accommodate the payroll outsourcing needs of any size organization.
The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.
Learn more about Global Employment Outsourcing
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