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English-speaking assistance for companies and self-employed employers recruiting staff in Spain—from the employment contract and Social Security registration to payroll, withholding tax and ongoing labour-law obligations.
Set up the employer correctly before work begins
Hiring in Spain creates obligations before the employee’s first working day. The employer must have the correct Spanish tax and Social Security registrations, obtain a contribution account code (Código de Cuenta de Cotización) where required and identify the applicable workplace, activity and collective bargaining agreement.
A foreign company without a Spanish subsidiary may still create Spanish payroll and Social Security obligations. Permanent-establishment, posted-worker and remote-work questions should be reviewed separately instead of assuming that a foreign employment contract is sufficient.
Employee, freelancer or company contractor?
Employee
The employer controls the work, organisation, timetable and economic risks. Spanish employment and Social Security rules apply.
Self-employed contractor
A genuine autónomo organises an independent business, bears commercial risk and normally serves clients autonomously.
False self-employment
Using an autónomo agreement for work that is actually dependent employment can trigger reclassification, back contributions and penalties.
TRADE contractor
An economically dependent self-employed worker may fall under the specific TRADE regime and requires particular contractual treatment.
Choose the lawful Spanish employment contract
Spanish law favours indefinite employment. Fixed-term contracts are permitted only for legally defined temporary reasons that must be stated precisely. The contract should identify the position, professional group, salary, working time, workplace, trial period, holidays and applicable collective agreement.
Indefinite contract
The standard form where there is no objectively limited temporary need. It may be full-time or part-time.
Temporary contract
Available only for specific production circumstances or temporary replacement, with strict justification and duration limits.
Training contracts
Alternating training and professional-practice contracts have eligibility, remuneration, tutoring and training requirements.
Remote-work agreement
Regular remote work requires a written agreement covering equipment, expenses, schedule, workplace and availability.
Registration, contract notification and employee documents
Employer review
Confirm tax status, contribution account, workplace, occupational-risk service and collective agreement.
Employee data
Check identity, NIE/TIE, work authorisation, Social Security number, bank details and professional category.
Contract and registration
Sign the correct contract, register the employee before work begins and notify the employment service where required.
HR file
Provide policies, privacy information, working-time records, health-and-safety documentation and payroll records.
Salary, Social Security and IRPF withholding
Spanish payroll is more than transferring the agreed net salary. The employer calculates gross remuneration, salary supplements, benefits in kind, employee deductions, employer contributions and personal income-tax withholding (retención de IRPF).
- Monthly payslip with the legally required breakdown
- Minimum salary and collective-agreement salary tables
- Extra payments, whether separate or prorated where permitted
- Contribution bases and contribution categories
- IRPF withholding based on the employee’s personal circumstances
- Electronic contribution and settlement files
- Annual wage and withholding certificates
- Accounting records and payment evidence
Working time, leave and employee rights
Working-time records
Daily start and finish times must generally be recorded and retained. Part-time employees require additional controls.
Annual leave
Paid holiday must meet statutory and collective-agreement minimums and is normally agreed through the company calendar.
Overtime
Limits, compensation, recording and employee consent depend on law, contract and collective agreement.
Paid leave
Marriage, family emergencies, relocation, public duties and other circumstances may create paid-leave rights.
Sickness and accidents
Temporary incapacity affects payroll, benefits, contribution files and employer supplements under the collective agreement.
Equality and work–life balance
Anti-discrimination, parental rights, flexible-working requests and equality obligations must be integrated into HR practice.
Employer duties beyond payroll
Occupational risk prevention
Every employer needs an appropriate prevention system, risk assessment, training, protective measures and health surveillance.
Data protection
Employee files, monitoring, biometrics, medical information and payroll data require a lawful GDPR and Spanish-data-protection framework.
Equality measures
Depending on workforce size and circumstances, an equality plan, pay register, salary audit or harassment protocol may be mandatory.
Labour inspection
Contracts, time records, payroll, contribution evidence, prevention documents and immigration authorisations should be inspection-ready.
Foreign companies employing people in Spain
A company abroad may need Spanish employer registration, a Spanish representative, local payroll and payment of Spanish Social Security contributions even without incorporating a Spanish company. The employee’s habitual workplace and the reality of the arrangement are more important than the contract’s chosen law.
For temporary postings, the A1 certificate, posted-worker notification, Spanish minimum employment conditions and immigration status must be checked. Long-term remote work from Spain can also create corporate-tax and permanent-establishment risks requiring separate tax advice.
Handle salary changes, leave and dismissals correctly
Changes to hours, salary, duties, workplace or employment conditions require the correct legal process and documentation. Resignations, disciplinary dismissal, objective dismissal, redundancy and contract expiry have different notice, severance and settlement rules.
The final settlement (finiquito), outstanding salary, unused leave, extra payments, Social Security deregistration and employment certificate must be handled promptly. A defective dismissal can be declared unfair or void.
Frequent risks for employers in Spain
Registration after the start date
The employee begins work before Social Security registration is effective.
Wrong collective agreement
Salary, category and working conditions are calculated under an inapplicable convenio.
Unlawful temporary contract
A fixed term is used without a valid, sufficiently specific temporary cause.
Incorrect payroll
Supplements, benefits, contributions, IRPF or extra payments are omitted or calculated incorrectly.
Missing time records
Daily hours and part-time records cannot be produced during an inspection.
Ignoring remote-work duties
No written agreement, equipment inventory, expense rules or risk assessment exists.
What we need before your first hire
- Employer’s country, legal form, tax number and Spanish registrations
- Business activity and place where the employee will work
- Job, duties, timetable and proposed salary
- Desired start date and expected duration
- Employee’s nationality and right to work in Spain
- Full-time, part-time, remote or hybrid arrangement
- Any applicable sector agreement or existing workforce
- Whether payroll and ongoing labour administration are required
Further business services in Spain
Frequently asked questions
Can a foreign company hire an employee in Spain?
Yes, but it may require Spanish employer and Social Security registration, local payroll and a representative. Tax and permanent-establishment consequences should also be assessed.
Must every employment contract be in writing?
Many contracts must be written, including part-time, temporary, training and regular remote-work arrangements. A written contract is strongly advisable in every case.
Can I hire someone as an autónomo instead?
Only where the work is genuinely independent. The parties’ label does not prevent authorities or courts from reclassifying false self-employment.
When must Social Security registration occur?
Normally before the employee starts working. The employer should not allow work to begin while registration is pending.
What does an employee cost in Spain?
Total cost includes gross salary, employer Social Security contributions and possible collective-agreement benefits, insurance, prevention and administration costs.
Can employment be terminated during probation?
A validly agreed probation period can allow termination without ordinary dismissal formalities, but limits, discrimination rules and collective-agreement conditions still apply.
Free initial consultation by email, WhatsApp or in person.
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ABOGADO24 is part of FLIN & ASSOCIATES.
This information is general and does not replace individual employment, Social Security or tax advice. Spanish legislation, collective agreements, contribution rates, wage tables and administrative practice may change. The correct treatment depends on the employer, activity, workplace, employee and actual working arrangement.