Hiring Employees in Spain: A Legal Guide for Employers

If you’re expanding into Spain or starting a business locally, hiring employees in Spain comes with specific legal requirements. Spanish labor law is protective of employees and highly regulated, so non-compliance can result in costly penalties.

This guide walks you through the key legal steps, documentation, and employer obligations when hiring staff in Spain.

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📋 1. Legal Structure to Hire

Before hiring employees, you must operate under a recognized legal structure in Spain:

• Spanish company (S.L. or S.A.)

• Foreign company with a branch or permanent establishment

• Freelancer (autónomo) – Can only hire a limited number of employees

• Non-resident entity via employer of record (EOR)

💡 Need help setting up a legal entity? We can assist with company formation or finding a compliant EOR solution.

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🏦 2. Register as an Employer

You must register with the following public bodies before hiring:

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📑 3. Draft a Compliant Employment Contract

Spanish law requires written employment contracts for:

• Temporary work

• Part-time work

• Remote work

• Any contract longer than 4 weeks

Standard elements include:

• Job title and duties

• Salary and benefits

• Working hours

• Termination clauses

• Trial period (typically 2–6 months)

📌 Use official templates or have your lawyer draft bilingual contracts.

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💰 4. Minimum Wage & Salary Obligations

• Spanish Minimum Wage (SMI): Reviewed annually by the government

• Salary must be paid monthly and include 2 extra payments (June and December), unless prorated

• Industry-wide collective bargaining agreements may set higher wages or benefits

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⏰ 5. Working Hours & Leave

• Standard full-time workweek: 40 hours

• Mandatory rest: 12 hours between shifts, 1.5 days/week off

• Paid annual leave: 30 calendar days

• Public holidays vary by region (national + regional + local)

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🧾 6. Onboarding & Social Security Registration

Each employee must be:

1. Registered with Social Security (via Form TA.2/S)

2. Assigned a Social Security number if they don’t have one

3. Reported to authorities before the start date

💡 Spanish authorities can audit this—failure to register employees on time can result in fines.

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📂 7. Employee Rights & Obligations

New hires are entitled to:

• Health and safety protections

• Payslips and employment records

• Anti-discrimination and equal treatment

• Right to union representation

• Protection from unfair dismissal

📌 Probationary periods, non-competes, and working conditions must follow Spanish labor laws or collective agreements.

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🧮 8. Payroll & Tax Withholding

Employers are responsible for:

• Withholding IRPF income tax

• Paying Social Security contributions (approx. 30% employer + 6.35% employee)

• Issuing monthly payslips (nóminas)

• Filing declarations to AEAT and Seguridad Social

We recommend outsourcing payroll to a local accountant or gestoría.

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🌍 9. Hiring Foreign Employees in Spain

You must verify that the employee:

• Has a valid residency and work permit (non-EU nationals)

• Is registered in Spain with a NIE (Número de Identidad de Extranjero)

• Has social security affiliation

For EU citizens, only social security registration is required.

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🛡️ 10. Employment Insurance & Risk Prevention

Employers must:

• Insure employees for occupational accidents

• Appoint or contract a health and safety advisor

• Provide training and perform risk assessments

• Maintain a workplace accident log

This is enforced by the Labor Inspectorate (Inspección de Trabajo).

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👨‍⚖️ Borderless Lawyers: Your Partner for Hiring in Spain

We guide international companies through:

• Employer setup and registrations

• Compliant employment contracts

• Hiring foreign workers

• Payroll and labor compliance

• Ongoing HR legal support