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Spain is a country in Southwestern Europe with some pockets of territory in Africa across the Strait of Gibraltar and offshore in the Atlantic Ocean. The country’s mainland is bordered to the south and east by the Mediterranean Sea; to the north and northeast by France, Andorra, and the Bay of Biscay; and to the west and northwest by Portugal and the Atlantic Ocean, respectively.
The Spanish economy has steadily surpassed that of its European counterparts over the last five years, in pre-pandemic circumstances.
A large percentage of the Spanish population has a higher education.
Life expectancy of Spaniards is longer than in most of the world thanks to the Spanish cuisine and the enjoyment of leisure activities. Spain’s universal healthcare leads the world in healthcare systems.
There are following employment contract options:
Any Spanish employment contract has to be written in Spanish. It is possible to draft in two languages,
however, the Spanish language shall prevail.
The standard probation period offered to employees in Spain is three months. For indefinite-term contracts (which make up the majority of employment contracts), the maximum legal probation period is six months.
Spain has a standard working week of 40 hours, which is typically spread over five days.
The maximum number of working hours per week is 48, and any hours worked above this must be paid as overtime.
In Spain, part-time labour is employment lasting up to 20 hours each week.
Spanish siestas – the usual practice for jobs in retail and other shops is a «split shift», lasting from 9 am to 8 pm with a two-hour lunch break.
In an office job, however, the working hours are similar to other countries with 30-60 minutes lunch breaks.
Employees shall be granted the following types of leave:
In Spain, employees are entitled to a minimum of 30 calendar days (i.e., 23 paid working days per year) of annual leave paid at their regular rate, this can be increased by collective agreements or by individual employment contracts.
Employees are entitled to up to 365 i.e. 12 months’ sick leave. Subject to obtaining a doctor’s certificate, sick leave can be extended by up to a further 6 months. At the end of the 18-month sick leave period, the social security body determines
whether:
the employee is fit to return to work;
the employee is suffering from a permanent disability or illness and therefore is unable or unfit to return to work, in which case their employment contract will end and the employee will be entitled to a state pension; or the employee does not suffer from a permanent disability or illness and is expected to recover, but remains unfit for work, in which case they may
be entitled to a further extension of up to six months. The maximum potential period of sick leave is therefore 24 months.
Under Spain’s labor law, when a worker is temporarily unable to work and in need of medical assistance due to illness or accident, he/she will be paid at least 60 percent of his/her wages. The employer normally pays the worker for a temporary sick leave and is reimbursed by the Social Security department. The maximum period of such leave is 18 months, after which the situation must be reviewed. The amount of sick leave pay depends on the status of the employee and the applicable collective bargaining agreement.
Maternity leave consists of 16 weeks’ paid leave, 6 weeks of which must be taken after the birth. To be eligible for maternity leave, the mother needs to be registered with the social security office and to have contributions for a minimum of 180 days during the prior seven years or a total of 360 days during her career.
One year of unpaid leave is also granted after the paid leave is taken and the mother’s job is guaranteed on return. The mother may take an additional two years of unpaid leave, but her employer does not have to offer her previous job to her on her return to work.
Paternity leave consists of 16 weeks’ paid leave, 6 weeks of which must be taken after the birth.
Employees are not legally required to work overtime unless this is stipulated in a collective agreement or individual employment contract. The number of overtime hours may not exceed 80 per year.
A 13th month or annual bonus is not required in Spain. A commission plan or quarterly bonus plan is a common practice.
The most common benefits for employees are:
Health insurance is funded through social security taxes.
Supplementary health insurance may be provided by an employer to an employee as a benefit.
Most executives request supplementary health and life insurance, or a small company may provide an allowance in lieu of
arranging insurance.
In Spain, an employment contract that exceeds one year can be terminated by either party giving the other a minimum of
15 days’ notice in writing. Employees not in their probation period must give their employer a minimum of 15 calendar days
of notice upon resignation, with up to three months of notice being given by some employees, in practice.
In general, for an indefinite contract in Spain without a trial period and without other specific agreements, an
employment contract can be terminated for the following reasons:
• mutual agreement between the parties
• reasons mentioned officially in the contract
• resignation of the worker
• death, serious invalidity or permanent, total or absolute invalidity of the worker
• retirement of the worker
• death, retirement or invalidity of the contractor or the end of their legal status
• collective dismissal (economic, technical, organizational or production grounds)
In practice, when an employer assesses that an employee is poorly suited for the role, an employer and an employee
usually come to a mutual agreement to terminate the contract. The expected liability for terminating an employee in
Spain may be budgeted as a severance fee for a wrongful termination equal to 33 days of salary per employment year
(basically one month of salary for every year worked with the company.) The calculation base for the fee includes extra
income as bonus and commissions, i.e., it is calculated on the basis of total gross income of the last 12 months.
Employees who believe they have been terminated unfairly may contest against their termination in a labor tribunal.
Dismissal on objective grounds could mean termination based on a lack of required skills, or for economic reasons.
Employees dismissed this way are entitled to receive 20 days of salary per years of service with the company.
This increases up to a maximum of 12 months of pay.
Severance compensation is calculated under two criteria: seniority and daily salary. In case of objective or unfair disciplinary dismissal the severance will be calculated by multiplying the seniority by the daily salary and the days (20 in case of objective dismissal/ 33 in case of unfair dismissal). The daily salary is calculated taking into consideration the twelve (12) last payments, and the company shall include all salary concepts. This also includes salary in kind and extra-hours. Only extra-salary concepts should be excluded. Therefore, bonuses, incentives and irregular payments are included.
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