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Compliantly hire and expand your business in Spain
When it comes to employing and managing employees in Spain, there are specific procedures and regulations that must be followed.
Spain is a country located in Southwestern Europe, with parts of its territory in the Atlantic Ocean, the Mediterranean Sea and Africa. It is the largest country in Southern Europe and the fourth-most populous European Union member state. Spanning across the majority of the Iberian Peninsula, its territory also includes the Canary Islands in the Atlantic Ocean, the Balearic Islands in the Mediterranean Sea, and the autonomous cities of Ceuta and Melilla in Africa. Peninsular Spain is bordered to the north by France, Andorra, and the Bay of Biscay; to the east and south by the Mediterranean Sea and Gibraltar; and to the west by Portugal and the Atlantic Ocean. Spain’s capital and largest city is Madrid, and other major urban areas include Barcelona, Valencia, Zaragoza, Seville, Málaga, Murcia, Palma de Mallorca, Las Palmas de Gran Canaria, and Bilbao.
Madrid
Capital
$33,090
GDP per Capita
$1.582 trillion
Total GDP
48,592,909
Total Population
0.911
Human Development Index
UTC+0/+1 (DST +1)
Time Zone
Spanish
Official Language
Euro (EUR)
Currency
505,994 km2 (195,365 mi2)
Land Area
Here's what you need to know
Overall, employing workers in Spain requires careful attention to the specific requirements and regulations. Working with a local expert in employment and payroll can help ensure that you’re meeting all the legal requirements and providing a positive employment experience for your staff.
Employment contracts are not mandatory in Spain, but highly recommended. They should clearly outline:
Job title, duties, and responsibilities
Salary and benefits (including 13th month salary and vacation bonus)
Working hours and overtime pay
Leave entitlements (annual leave, sick leave, etc.)
Termination terms (notice period, severance pay)
Confidentiality clauses (if applicable)
Minimum Wage
Spain has a national minimum wage, currently set at €1,134 gross per month (as of January 1, 2024).
Payroll Terms
Salaries are typically paid monthly by bank transfer between the 25th of the month to which the pay relates and the 5th of the following month. Payslips with details of gross pay, deductions, and net pay are mandatory.
Taxes
Spain operates a progressive income tax system. Employees pay income tax based on their annual earnings, with rates ranging from 19% to 47%. Employers withhold income tax at source and remit it to the Spanish Tax Agency (AEAT) along with social security contributions.
Social Security
Both employers and employees contribute to social security programs covering pensions, unemployment, healthcare, and parental benefits. Contribution rates vary depending on the employee's salary and type of employment contract.
Spain has a standardized leave policy mandated by the Workers’ Statute:
Annual Leave
Minimum of 30 calendar days per year (22 working days), increasing with service duration. Unused vacation days cannot be "sold back" to the employer and must be compensated if not used upon leaving the company.
Sick Leave
Up to 14 days per year with doctor's certification, extending to a year in specific cases.
Maternity Leave
Up to 16 weeks of paid leave for female employees, followed by an optional unpaid parental leave (up to 3 years).
Paternity Leave
5 days of paid leave for male employees, with an optional 15-day extension (unpaid) at the employer's discretion.
Public Holidays
10 national holidays per year with the potential for regional variations. Each municipality enjoys a total of 13 public holidays per year.
Probationary Period
There's no mandatory probationary period in Spain. However, employment contracts often include one, typically lasting between 1 and 6 months. During this time, termination can be easier for both employer and employee.
Termination of Employment
Termination of employment should follow the terms outlined in the contract or the Workers' Statute. Notice periods vary depending on the reason for termination and the employee's length of service. Severance pay may also be required under certain circumstances.
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