Spain's Labor Laws: Essential Guide for International Employers

Operating a business in Spain or hiring Spanish employees remotely? Understanding Spain’s labor laws is crucial to maintaining compliance, protecting employee rights, and building a successful international team. From employment contracts to working hours and termination processes, Spain's labor regulations are designed to safeguard employees and set clear guidelines for employers.

Navigating these regulations can be complex, especially for international employers. Ontop provides an all-in-one platform to manage global payroll and ensure compliance with local labor laws. Ready to simplify your payroll and compliance in Spain? Book a demo with Ontop to explore our solutions.

Key Aspects of Spain’s Labor Laws for Employers

1. Employment Contracts in Spain

In Spain, employment relationships must be formalized with a written contract. Spanish labor law requires that every employment contract include essential details, such as:

• Employment Duration: Specify whether it’s a temporary or permanent position.
• Compensation: Include details about salary, bonuses, and any other benefits.
• Working Hours: Define the weekly or monthly working hours.
• Job Role and Responsibilities: Outline the main duties associated with the position.

Employers must ensure that contracts comply with the legal requirements to avoid disputes or penalties. Failure to formalize employment terms in writing can lead to issues with labor authorities. Ontop can simplify contract management and ensure you’re compliant with Spanish laws. Schedule a demo to learn how we support international employers in Spain.

2. Working Hours and Overtime Regulations

The standard workweek in Spain is 40 hours for full-time employees, with daily working hours not typically exceeding 9 hours. Here are some key aspects to keep in mind:

• Overtime: Employees are entitled to additional compensation for hours worked beyond the standard workweek. Overtime should be paid or exchanged for additional rest time, depending on the contract or collective bargaining agreement.
• Rest Periods: Spanish law mandates at least 12 hours of rest between working days, as well as a weekly rest period of at least 1.5 days.
• Breaks: For work shifts exceeding six hours, employees are entitled to a 15-minute break.

Certain industries may have specific regulations or collective agreements that adjust working hours or rest periods. Employers must comply with these regulations to avoid penalties. Using Ontop’s platform can help you manage employee schedules and ensure compliance with working hour laws across different jurisdictions. Book a demo for more details.

3. Minimum Wage in Spain

Spain sets a national minimum wage that is reviewed and adjusted annually. For 2024, the minimum wage stands at approximately €1,080 per month for full-time employees, based on 14 payments per year. Key points to consider:

• Sector-Specific Minimums: Some sectors have collective agreements with higher minimum wages than the national standard. Employers must ensure they adhere to these specific requirements.
• Annual Adjustments: The minimum wage is subject to change, so employers need to stay updated on any adjustments made by the Spanish government.

Non-compliance with minimum wage laws can lead to fines and damage your company’s reputation. Ontop keeps track of local wage regulations to help you stay compliant across borders. Schedule a demo to learn more.

4. Leave Entitlements and Public Holidays

Employees in Spain are entitled to paid leave, including:

• Vacation: Employees receive a minimum of 30 calendar days of paid leave per year.
• Sick Leave: Employers are generally required to pay a portion of the employee’s salary during the first few days of sick leave.
• Maternity/Paternity Leave: Spain provides generous leave policies for new parents, including 16 weeks of paid leave for both mothers and fathers.

Spain also recognizes numerous public holidays that employees are entitled to take off with pay. Adhering to these entitlements is essential to ensure compliance and foster a positive work environment. Ontop’s payroll solution automatically calculates leave and holiday entitlements, simplifying compliance for international teams. Book a demo to find out how Ontop can help manage your team’s leave entitlements.

5. Termination and Severance in Spain

Terminating an employee in Spain is a regulated process that requires valid grounds, such as:

• Objective Dismissal: Justified by reasons like economic circumstances or poor performance. Requires a severance payment of 20 days’ salary per year worked.
• Disciplinary Dismissal: Based on serious misconduct, such as breach of contract or absenteeism. No severance is required if the termination is deemed fair.
• Unfair Dismissal: If the dismissal is deemed unjust, the employer may be required to reinstate the employee or provide compensation.

Notice periods and severance pay depend on the employee's length of service and the reason for dismissal. Given the complexity of termination laws, consulting legal experts or using a reliable payroll platform like Ontop is advisable. Book a demo to see how Ontop can assist with compliant termination practices in Spain.

Additional Compliance Tips for Employers in Spain

1. Stay Updated on Labor Law Changes: Spanish labor laws are subject to updates. Regularly review legal changes to ensure your employment practices remain compliant.
2. Maintain Detailed Records: Spanish law requires employers to keep accurate records of work hours, contracts, payroll, and leave entitlements. This can help protect against potential disputes or audits.
3. Engage with a Compliance Partner: Using a global payroll solution like Ontop simplifies compliance by automatically updating changes in labor regulations and providing local expertise.
4. Understand Sector-Specific Rules: Different industries in Spain have unique regulations under collective bargaining agreements. Ensure you’re aware of any additional obligations relevant to your sector.

Ready to simplify payroll and compliance for your Spanish workforce? Ontop provides tailored solutions for managing international payroll, contracts, and compliance. Book a demo to see how Ontop can help your business operate smoothly in Spain.

Why Choose Ontop for Your International Payroll in Spain?

Managing payroll and compliance across borders is challenging. Ontop offers a streamlined solution for companies with global teams, ensuring compliance with local laws, automating payroll calculations, and simplifying employee management. With Ontop, you can:

• Automate Payroll Compliance: Stay compliant with Spanish labor laws without the need for manual tracking.
• Manage Contracts Efficiently: Create, sign, and store employment contracts in one secure platform.
• Streamline Payments: Ensure timely and accurate payments across currencies, including Euro.
• Access Expert Support: Our team is available to help with local compliance questions and provide guidance on labor law updates.

Expand your team confidently in Spain with Ontop’s global payroll solutions. Book a demo today to learn how we can support your business growth while keeping you compliant with Spanish labor laws.

Conclusion

Navigating labor laws in Spain is essential for any business employing workers in the country. Understanding requirements around employment contracts, working hours, minimum wage, and termination can help ensure compliance and foster a positive work environment. For companies operating internationally, managing these obligations can be complex, but with the right tools, it’s manageable.

Ontop offers a powerful platform to simplify payroll and compliance in Spain, allowing you to focus on growing your business. From automated payroll management to local compliance support, Ontop is here to make international employment seamless. Schedule a demo and discover how we can help you navigate Spain's labor landscape with ease.

‍