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Spain is a prime destination for a Europe-based workforce: It has a strong education system, reliable business infrastructure, and a large, diverse economy. Additionally, flexible labor laws and business investment incentives make it a good European base for international businesses.
However, when hiring in Spain it is important to consider how the Spanish working culture, employee benefits and workplace protections will impact employees, and your business.
|Population 47M (23M in the labor force)||Capital City Madrid||Languages Spoken Spanish – ranked 4th globally|
|Currency Euro (€)||GDP $27,000||Ease of Doing Business 28th in the world|
|Minimum Wage €1,166.70/month (2022)||Average Wage €2,006.61/month (2022)||Paid Leave 23 days|
According to the European Commission, Spain’s economy shrank by 10.8% in 2020 due to the pandemic, but recovered well in 2021 to grow 5.1%, and modest growth is forecast for 2022 and 2023. This reflects the economic trends seen across other developed countries around the world.
Spain has relatively strong labor laws protecting employees, so it’s important to understand your obligations as an employer before hiring.
The main labor laws relate to things like mandatory parental leave, sick leave, termination notice periods and severance, working hours, and so on. For more information, take a look at our Spain PEO page for more details on Spanish labor laws.
Spain’s business culture, along with its culture in general, has undergone significant change in the last few decades. During this time, the country saw a huge influx of foreign tourists. With more than 80 million tourists each year, it is now the second-most visited country in the world, and it is also a hugely popular destination for expats. This has brought in money, the English language, and foreign culture, causing many parts of Spain to adopt various elements of the cultures of its Northern European neighbors.
This being said, Spain still retains a relatively relaxed business culture overall, with a more laid-back culture and fewer formalities than most other European countries. The focus is often more on building personal relationships and rapport than you may be used to, and strict punctuality is usually not viewed as being as important as it would be in many other countries, even in a business context. However, initial business interactions are usually quite formal, and this is even reflected in the Spanish language itself (using usted instead of tú in formal situations).
In Spain, as in most other countries, people generally search for jobs online. There are a number of popular job websites, including Indeed, Bolsa de Trabajo, and Monster. Social media platforms such as Facebook and LinkedIn are also popular. Posting your jobs on any of these sites is a great way to find candidates.
To simplify the process further, you can hire a global PEO such as Horizons to work with you and find the perfect candidate for the job.
In-person interviews are standard and expected in Spain. Online interviews are becoming increasingly popular, so either option is acceptable. One-on-one interviews are most common, but panel interviews are not unheard of. Candidates will generally expect a typical interview situation with the usual formalities such as handshakes, business dress code, and so on.
Employers in Spain are permitted to ask about the candidate’s current/previous salary and their salary expectations; however, the candidate is not obliged to respond.
The typical salary increase in Spain when changing jobs is a 10%-20% increase.
The onboarding process for new employees in Spain will vary from organization to organization. The most important thing is to be as clear as possible and include all the important legal information in a written contract.
The basics of onboarding apply, and you should set aside a period of time to communicate company policies and working culture, expectations of the role, conduct any necessary training, and offer introductions to the rest of the team. It’s also good practice to give new hires the chance to ask questions and offer feedback at one or more follow-up meetings after a few days on the job.
There are a variety of remote working tools available in Spain. Typically, those most often used in Spain are seen as standard across the globe: Microsoft Teams, Slack, Clickup / Monday / Jira, etc.; you should be able to easily integrate your Spain employees into whatever communication systems you are already using for your employees.
There are 8 national holidays in Spain:
|6 Jan Friday||Epiphany|
|7 Apr Friday||Good Friday|
|1 May Monday||Labor Day / May Day|
|15 Aug Tuesday||Assumption of Mary|
|12 Oct Thursday||Hispanic Day|
|1 Nov Wednesday||All Saints’ Day|
|6 Dec Wednesday||Constitution Day|
|8 Dec Friday||Immaculate Conception|
|25 Dec Monday||Christmas Day|
There are also several holidays for regional or autonomous communities. Depending on where your employee is located, they may be entitled to additional days. This can be reviewed by our team and a detailed local holiday schedule for your employee will be shared as your hiring project begins.
Employees in Spain expect an annual salary increase of approximately 3%-10%; however, there is no set standard and the increase amount would depend on a variety of factors, including what is set out in collective bargaining agreements or what the employer offers (if above the amount required by the collective bargaining agreement). It is best to discuss this with candidates you have extended an offer to and have the annual raise amount included in the employment contract.
This question is extremely personal and based on your exact situation, risk tolerance, and the type of work you need to have done.
Hiring freelancers in Spain does come with certain risks, including risk of employee misclassification if the freelancer is determined to be, in fact, and employee.
In general, we would recommend to have international and Spanish tax professionals assess your situation and advise you on whether you should hire a Spanish freelancer or a Spanish employee. In most cases, hiring an employee will come with the least risk, but it would also require specialized knowledge of Spanish employment law. Hiring your employee with Horizons would fulfil that requirement and allow you to hire employees in Spain with ease.
Yes, it is fully possible to hire foreign employees in Spain. You should note that the foreign employee in Spain would not be able to begin work until the Spanish immigration employees have approved the employee’s work permit.
Opening a subsidiary in Spain is a lengthy and laborious process. It can take more than two months to complete and is considered an overall difficult process.
If you want to open a subsidiary in Spain, it would require:
Opening a branch office is less complicated, but still requires a significant amount of paperwork and local knowledge of Spain. The documents required to open a branch office in Spain include:
In most cases, the fastest and safest way (from a compliance perspective) to get operations started in Spain is to hire your first several employees with a global EOR like Horizons.
The process of hiring employees in Spain can be straightforward. If you have already identified a candidate, you can contact us for a free consultation and detailed description of how we can hire your Spanish team in the next 48 hours.
Your business can easily hire employees in Spain without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.