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Employing a worker in Spain

Known for its central geographic location, innovative industries, and transport links, Spain is a great choice for businesses and investors looking to enter the European market. In this post, we provide some information on employing a worker in Spain.

Capital GES created our postcard series to help businesses that are considering expansion and employing global staff. In this postcard series, members of our sales and business development team provide helpful tips on international employment. Below, we discuss employing a worker in Spain.

Spain Overview

For companies looking to expand into Europe, Spain is a great choice.

As the fourth-largest economy in the EU, Spain provides businesses and investors opportunities in many sectors including agricultural, manufacturing, tourism, agritech, retail, telecommunications, and fintech sectors. Furthermore, tech hubs have grown in many cities across the country to entice new start-ups and investors. The Spanish government is very open to foreign direct investment with many multinationals establishing themselves in Spain. As with all members of the EU, Spain offers businesses access to the EU single market of over 450 million customers as well as a large domestic market of 42 million inhabitants.

Employing a worker in Spain – Employment Laws to know

However, expanding into an unfamiliar country can be challenging, and Spain is no different. Therefore, it is vital to have local knowledge when expanding a business and employing workers in Spain. Below, we discuss the most common questions asked by clients regarding employment in Spain.

1. Contracts

Can I trial a worker using a fixed-term employment contract, as I am not sure whether it will work out in the long term?

Fixed-term contracts are available. However, Spanish legislation requires that they can only be used in limited situations and cannot be used for permanent roles.

In Spain, fixed-term contracts can be extended once and cannot exceed more than 24 months. It is important to note that fixed-term contracts cannot be terminated early by the employer (or only for very specific reasons).

To ensure your worker stays fully compliant in Spain, it is best to discuss your contract options with a local partner.

2. Termination Rules and Costs

What do I need to know about termination and severance pay in Spain?

Terminations are often complex and should be considered with local experts before any notice is issued. There are three common forms of termination: Termination by mutual agreement, dismissal on disciplinary grounds, and dismissal on objective grounds; the process around termination varies between each form. Employees could appeal to a court if they considered the dismissal unjustified. Additional compensation may be due if a court deems the dismissal to be unfair.

Severance Pay

Severance pay is dependent on the reason for the termination. In cases of termination due to economic or agreed performance issues, employees should receive 20 days’ salary per year of service with the employer.

3. Statutory Benefits

What are the statutory employee benefits in Spain?

Statutory paid holiday

In Spain, employees are entitled to 22 days of paid leave after one year’s continuous employment. Public holidays are not included.

Parental Leave

Maternity

In Spain, mothers are entitled to 16 weeks of maternity leave. This leave is paid at 100% of regular pay and funded by the Social Security system. Employers continue to pay social contributions through maternity leave. Mothers must take at least six weeks of maternity leave after the birth. After which they can grant the remaining maternity leave to the father.

Mothers also have a right to take one year of unpaid leave following maternity leave.

Paternity

In Spain, fathers are entitled to 12 weeks of paternity leave. The first four weeks must be taken after the child’s birth and the remaining leave can be taken up to the child’s first birthday. During this period, the employee will receive a state allowance equivalent to 100% of his social security contribution base.

Parental

In Spain, employees are entitled to three years period of unpaid leave until the child turns three.

Sick Pay

During the first three days of sickness, the employer normally bears the costs of the employee’s full salary. From the fourth day of sickness, the employee is entitled to receive payment from the Social Security system. In order to receive sick pay the employee must provide a medical certificate. Sick pay is made at 60% from the fourth day until the 20th day and at 75% from the 21st day for a maximum of 12 months.

How Capital GES Can Help You Expand and Employ Workers in Spain

If you are a business that is looking to expand internationally and employ workers in Spain, Capital GES can help.

To establish what services you require, contact our sales team at sales@capital-ges.com, phone +41 32 732 9700 or fill in the form below.

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