As hybrid work arrangements become the norm and teams grow more dispersed, many employers are looking to overseas talent pools to meet their hiring needs. Spain has emerged as a strong contender for tech hiring thanks to its many highly-skilled workers. Amazon recently selected the Spanish capital city of Madrid as its tech hub for Southern Europe, and the cities of Valencia and Barcelona are also well-known tech bases.
If you’re seeking to expand your team by hiring Spanish professionals for your tech base, there are a few things you should know. As with most countries, hiring internationally in Spain isn’t exactly straightforward. There are complications involved with setting up an entity to work legally across borders. To address this challenge, many organizations look to employer of record (EOR) services in Spain.
EORs in Spain
An EOR is an organization that acts as an employer for legal and tax purposes, enabling your company to work legally overseas. EORs perform human resources and legal functions, managing tasks like payroll, taxes, compliance, and benefits for your remote employees. These third-party organizations take responsibility for all formal employment tasks, allowing you to quickly hire workers in global markets.
In other words, using an EOR in Spain allows you to tap into the country’s rich talent pool without the typical headaches that can come with global employment. Oyster makes hiring across borders simple by handling all aspects of employment for you, including:
- Compliance with local laws
- Onboarding
- Payroll
- Benefits
- Time off management
- Offboarding
To learn more, check out this webinar with Figures, Oyster, and Circular for expert insights on navigating the Spanish talent market. Or talk to an Oyster expert today to find out how our global employment platform can help simplify onboarding team members in Spain.
A few things to know about hiring in Spain
Since the employment landscape is highly regulated in Spain, it makes sense to ensure you’re fully compliant by working with an EOR. Spain categorizes jobs differently than the U.S. and has strict regulations regarding salary ranges, working hours, and vacation days in each category. Employment is regulated by the Statute of Workers, which grants worker protections. Here are a few other factors to consider when hiring in Spain:
Statutory notice period
There is a statutory notice period for contracts in Spain, which has a maximum length of three business weeks (15 working days). The employee’s notice period cannot exceed this.
Working hours
As in the U.S., full-time workers in Spain must average 40 hours of work per week maximum. This figure is calculated on an annual basis. Unless there has been a formal agreement established, employees cannot exceed nine hours in a workday. For employees who are under the age of 18, the maximum is eight hours a day. Employees are also permitted to work 80 hours of overtime per year, which excludes overtime compensated with rest time.
Employment contracts
You can choose either indefinite or fixed-term contracts when hiring in Spain. However, under newly implemented regulations, fixed term contracts are highly regulated and limited, and you must be able to justify the reasoning for implementing a fixed-term contract. Many employees seek out indefinite contracts since they often feature better job security and higher compensation.
Work-from-home allowance
Spain implemented a work-from-home allowance for all remote workers in 2021. The allowance amount shall be agreed between the worker and the employer or, in the applicable collective bargaining agreement.
Severance pay
Once an employee’s contract is up, they may be entitled to compensation. Severance payments vary based on numerous factors, including the reason for dismissal, nature of the contract, and length of employment. For example, if an employee is unfairly terminated, they may be eligible for up to 33 days of salary for each year of employment capped at 24 months upon termination.
Pensions
Under Spanish law, employers must make significant contributions to an employee’s pension and social security (23.6% of the worker’s salary). The employee contributes 8% of their pay. While occupational and private pension options are available, they typically aren’t needed due to the state pension arrangements.
Paid time off
Spanish workers are entitled to specific PTO benefits, including at least 22 paid business days off, unless a collective bargaining agreement is applicable, which may be divided as long as there is at least one two-week period off.
Employers must also pay for the first three days of sick time. After that, the social security system administers sick pay. The maximum time frame for sick pay is 18 months in Spain.
Parents are also eligible for maternity and paternity leave, which consists of 16 weeks of paid leave at 100% of the employee’s salary, covered by the social security system, as long as the employee meets certain criteria.
There are also certain considerations for holidays, taxes, and other employment details. Find out more about hiring in Spain in our complete guide.
No matter where in the world you want to hire, Oyster can simplify the process. See how we can help expand your global workforce by handling payroll, compliance, and other employment activities.
How much does it cost to hire in Spain?
Check out our cost of hiring in Spain calculator to get an idea of how much tax you might have to pay on top of an employee's salary.
About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.
