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Hire in Spain,
compliantly,
without the complexity.

We become the legal employer for your international workforce in Spain. You keep full control of your team — we handle payroll, taxes, benefits, and local compliance.

Official NameKingdom of Spain (Reino de España)
CapitalMadrid (Barcelona: European Startup & Mobile Capital / Valencia & Málaga: Tech Hubs)
CurrencyEuro (EUR / €)
Official LanguageSpanish (Castilian; Catalan, Basque & Galician co-official)
Population~48 million (4th largest economy in the Eurozone, ~$1.6T USD GDP)
Time ZoneCentral European Time (CET, UTC+1 / CEST, UTC+2 / Canary Islands: WET, UTC+0)
Minimum Wage (SMI)€1,134.00 / month (Paid over 14 months = €1,323.00/mo on 12-month basis)
Mandatory 14 Payments (Pagas Extraordinarias)14 Payments/Year (1 month summer bonus + 1 month Christmas bonus)
Social Security (Seguridad Social - Employer)~30.0%–33.5% Employer (Contingencias Comunes 23.6%, Desempleo 5.5%, FOGASA, FP & MEI)
Social Security (Seguridad Social - Employee)6.45%–6.50% Employee (Contingencias Comunes 4.70% + Desempleo 1.55% + MEI)
Beckham Law (Special Expat Tax Regime)Flat 24.0% personal tax rate on earnings up to €600,000 for foreign talent
Annual Vacation (Estatuto de los Trabajadores)30 calendar days (22 working days) paid vacation per year
Standard Workweek40 hours/week (typically 8 hours/day over 5 days under Labour Statute)

The Kingdom of Spain is the fourth-largest economy in the Eurozone (EU, OECD, NATO member, ~$1.6+ trillion USD GDP) and one of Europe's premier, fastest-growing technology, startup, and engineering nearshoring destinations. Centered in Madrid (financial and corporate headquarters hub) and Barcelona (global mobile and startup capital hosting MWC, gaming studios, and major tech unicorns), alongside dynamic tech hubs in Málaga ("Silicon Valley of Southern Europe" hosting Google Cybersecurity Hub) and Valencia, Spain offers high engineering graduate density, world-class high-speed rail and fiber broadband infrastructure, and vibrant lifestyle appeal. However, hiring employees in Spain requires navigating the Spanish Workers' Statute (*Estatuto de los Trabajadores*), mandatory applicable sectoral **Collective Bargaining Agreements (*Convenios Colectivos*)**, the mandatory **14 payments per year (*Pagas Extraordinarias* in June and December)**, mandatory employer Social Security contributions (**Seguridad Social** at ~30%–33.5%), the Intergenerational Equity Mechanism (**MEI**), the landmark **Beckham Law (Special Expat Tax Regime offering a flat 24% tax rate)**, and progressive income tax withholding (*IRPF*) filed with the *Agencia Tributaria (AEAT)*. Setting up a Spanish *S.L.* (Sociedad Limitada) takes 3 to 6+ weeks. A Global Employer of Record (EOR) enables international software, fintech, and gaming companies to hire talent in Spain legally, quickly, and without establishing a local company. The EOR acts as the legal employer, managing Convenio Colectivo classifications, 14-payment payroll, Seguridad Social electronic filings via RED, Beckham Law applications, and compliant EUR payroll processing while you direct daily operations.

Economic Overview, Madrid Financial Hub & Barcelona Startup Capital

Spain is a top European technology hub combining elite software engineering talent with the Beckham Law 24% flat tax regime.

Key Economic Clusters

  • Software, Mobile & Gaming (Barcelona): Global mobile capital (MWC), top game development studios (King, Ubisoft), and SaaS unicorns.
  • FinTech & Corporate HQs (Madrid): Global banking titans (Santander, BBVA), tech headquarters, and venture capital.
  • Cybersecurity & Cloud (Málaga & Valencia): Google European Cybersecurity Centre of Excellence and AI research labs.

Employment Contracts, Estatuto de los Trabajadores & Convenio Colectivo

Regulated by the Estatuto de los Trabajadores and sectoral Convenios Colectivos.

  • Mandatory Convenio Colectivo: Every employment contract must be classified under the appropriate sectoral and provincial collective agreement (e.g. *Convenio de Consultoría y Tecnologías de la Información* for tech staff).
  • Indefinite Contract Rule (2022 Reform): Permanent indefinite employment (*Contrato Indefinido*) is the mandatory statutory default; temporary contracts are strictly limited to structural production increases or replacement.
  • Probation Period: Maximum 6 months for qualified technicians/graduates and 2 months for other staff (under statute, or as defined by the applicable Convenio).

Working Hours, Overtime & Mandatory Daily Time Tracking (*Registro de Jornada*)

  • Standard Hours: 40 hours per week of effective work on annual average (typically 8 hours/day over 5 days).
  • Mandatory Daily Time Tracking (*Registro de Jornada*): Employers are legally obligated to maintain an electronic daily record of the exact start and end times of each employee's working day.
  • Overtime Surcharges: Minimum statutory surcharge of **175% (75% premium)** under applicable Convenio, or compensated with equivalent paid time off within 4 months (capped at 80 overtime hours per year).

Annual Leave (30 Calendar Days), 14 Payments & 16-Week Equal Parental Leave

Annual Vacation & 14 Pagas Extraordinarias

  • Annual Paid Vacation: Minimum 30 calendar days (or 22 working days) per calendar year.
  • 14 Salary Payments (*Pagas Extras*): All employees are legally entitled to 14 payments per year: 12 monthly salaries plus the **Summer Extra Pay (*Paga de Verano*)** in June and the **Christmas Extra Pay (*Paga de Navidad*)** in December (can be prorated into 12 monthly payments if agreed in the contract/Convenio).

16-Week Equal Parental Leave (*Permiso por Nacimiento*)

Both mothers and fathers/second parents receive 16 weeks of 100% fully paid, non-transferable parental leave paid directly by the Social Security system (6 weeks mandatory immediately following birth).

Social Security (~32% Employer), MEI, Beckham Law & IRPF

The Beckham Law (*Régimen Especial de Trabajadores Desplazados*)

Foreign skilled professionals and executives relocating to Spain who have not been Spanish tax residents during the previous 5 years can opt for the Beckham Law, granting a flat 24.0% personal income tax rate on Spanish employment income up to €600,000 for up to 6 consecutive tax years.

Social Security (Seguridad Social) Breakdown

Social Security Regime Employer Share Employee Share Description
Common Contingencies (*Contingencias Comunes*) 23.60% 4.70% Retirement pensions, healthcare & temporary disability (capped base)
Unemployment (*Desempleo*) 5.50% (perm) / 6.70% (temp) 1.55% National unemployment protection fund
Wage Guarantee Fund (FOGASA) 0.20% 0.00% Insolvency wage guarantee fund
Vocational Training (*Formación Profesional*) 0.60% 0.10% National vocational training fund
Intergenerational Equity Mechanism (MEI) 0.58% 0.12% Pension reserve replenishment fund (0.70% total)
Workplace Accidents & Occupational Diseases (IT/IMS) ~1.50%–3.50% 0.00% Risk-differentiated occupational insurance (1.50% for office/IT)
Total Statutory Contributions ~31.98%–33.98% 6.47% Capped at maximum monthly base (~€4,720.50/mo)

Personal Income Tax (IRPF): Progressive combined state and regional rates from 19.0% up to 47.0% (or flat 24.0% under the Beckham Law), withheld monthly and remitted to AEAT.

Termination, Objective Dismissal (20 Days) vs. Unfair Dismissal (33 Days)

Spanish Statutory Severance Framework

  • Objective Dismissal (*Despido Objetivo*): Economic, technical, organizational, or production reasons require **15 days written notice** and mandatory statutory severance of **20 days' salary per year of service** (capped at 12 months' salary).
  • Unfair Dismissal (*Despido Improcedente*): If challenged and declared unfair by a labor court or conciliation body (*SMAC*), severance is **33 days' salary per year of service** (capped at 24 months of salary).

Why Use an Employer of Record (EOR) in Spain

  • Rapid Access to Madrid & Barcelona Tech Talent: Onboard software engineers and sales leads in Spain in days.
  • Convenio Colectivo, Pagas Extras & RED Automated Compliance: Seamless electronic submission of Social Security via Sistema RED and accurate 14-payment payroll.
  • Beckham Law & Digital Nomad Visa Sponsorship: EOR manages Beckham Law filings and UGE work permits for international specialists.

Hiring in Spain? Key Resources

Whether you are evaluating entity setup vs. using an Employer of Record, or looking for the best international payroll solution, our guides give you transparent benchmarks:

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