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How to hire and pay employees in Spain
Slasify
Jun 19, 2025
Before Hiring in Spain
Discover the global hiring and employment landscape in Spain—combining a rich cultural heritage with modern business practices, Spain offers a dynamic economy and strategic access to European and Latin American markets. With its skilled workforce and supportive business environment, Spain is an attractive destination for international expansion.
Explore the employment essentials including payroll, personal income tax, statutory contributions, annual leaves, minimum wage, terminations, visa requirements, and more. Gain valuable compliance insights for a smooth entry into the dynamic Spain market with Slasify's global premium HR platform.
At a Glance
| Capital | Madrid |
| Currency | Euro (EUR) |
| Payroll Cycle | Monthly |
| Minimum Wage (SMI) | EUR 1,184 per month |
| Annual Leave | 30 calendar days |
| Personal Income Tax | 19%–47% |
Personal Income Tax
Employment income in Spain for residents is taxed on a progressive scale that is a derived from the rates approved by the state (applicable to everyone the same) and the rates approved by each autonomous community of Spain (differs from one autonomous community to another).
| Taxable Income (EUR) | Progressive Tax Rate (State) | Progressive Tax Rate (Community)** | Total Progressive Tax Rate |
|---|---|---|---|
| Up to 12,450 | 9.5% | 9.5% | 19% |
| 12,451–20,200 | 12% | 12% | 24% |
| 20,201–35,200 | 15% | 15% | 30% |
| 35,201–60,000 | 18.5% | 18.5% | 37% |
| 60,001–300,000 | 22.5% | 22.5% | 45% |
| Over 300,000 | 24.5% | 22.5% | 47% |
**The rates in this column apply to taxpayers that do not reside in Spain. For those who do, the rates are to be replaced with those approved by their respective community.
For non-residents, employment income tax is set at a flat rate of 24%. However, if the non-resident is a resident in an EU or EEA country with which there is an effective exchange of tax information, the tax rate is 19%.
Local Taxes
Each autonomous community of Spain has their own respective progressive tax rates, which influence the total progressive tax rates that apply to each resident employee.
Refer to the tax table in the previous section for an illustration on how autonomous communities' taxes affect the total progressive tax rates and consult with the relevant authorities in the respective autonomous communities to determine the different rates that are applicable.
Statutory Contributions
Social security contributions in Spain are calculated based on the employee's salary of at least the established inter-professional minimum wage and up to a maximum of EUR 4,909.50 per month.
Effective January 2025, a solidarity contribution shall apply to those whose salary is higher than the maximum contribution base.
| Contribution base | Solidarity contribution rate |
|---|---|
| For the portion of salary between the maximum contribution base and (maximum contribution base + 10%) | 0.92% |
| For the portion of salary between (maximum contribution base + 10%) and (maximum contribution base + 50%) | 1% |
| For the portion of salary over (maximum contribution base + 50%) | 1.17% |
The distribution of the solidarity contribution rate between the employer and the employee shall be as follows:
| Employer | Employee |
|---|---|
| 83.39% | 16.61% |
Employer Contributions
| Contribution Rate | |
|---|---|
| Common Contingency | 23.6% |
| Salary Guarantee Fund (FOGASA) | 0.2% |
| Professional Training | 0.6% |
| Unemployment | 5.5% |
| Work Injury Insurance (Professional Contingency) | This rate shall be determined based on the economic activity, as established here |
| Intergenerational Equity Mechanism (MEI) | 0.67% |
Employee Contributions
| Contribution Rate | |
|---|---|
| Common Contingency | 4.7% |
| Unemployment | 1.55% |
| Professional Training | 0.1% |
| Intergenerational Equity Mechanism (MEI) | 0.13% |
Payment of Wages
Employers shall pay their employees periodically at a frequency of at least once a month.
Minimum Wage
Effective January 1, 2025, the minimum wage (SMI) in Spain is set at EUR 1,184 per month.
It is important to keep in mind that the established SMI accounts for the employer's obligation to pay 13th and 14th month salaries, i.e. totaling to EUR 16,576per year for general employees. When spread over a period of 12 months, the minimum wage effectively becomes EUR 1,381.33 per month.
Statutory Bonus
Employees in Spain are entitled to a 13th month and a 14th month pay, known locally as pagas extraordinarias. These are paid on the occasion of the Christmas holidays and on another date established by collective agreements or by individual agreements.
Each of these payments must be equivalent to at least one-fourteenth of the employee's annual pay, and contracting parties may agree to have these payments be prorated over 12 months.
Termination
Employers are can only dismiss their employees if they have an objective reason or a disciplinary reason to do so.
| Objective reasons for dismissal | Disciplinary reasons for dismissal |
|---|---|
| Unexpected incompetence after hiring | Repeated and unjustified absences from work or lack of punctuality |
| Indiscipline and disobedience at work | |
|
Inability to adapt to technical changes in the job position, provided that the change is reasonable and the employer has offered a course aimed at facilitating adaptation to the changes made. Dismissals for this reason cannot take effect until at least 2 months after the relevant changes or the end of adaptive course. |
Verbal or physical offences against the employer or any person rendering services in the company or their relatives residing with them |
| Harassment due to racial or ethnic origin, religious beliefs or ideology, disability, age or sexual orientation and sexual harassment against the employer or any person rendering services in the company. | |
| Breach of contractual good faith and abuse of trust at work | |
|
Redundancy due to economic, technical, organizational or production-related reasons, provided that it does not amount to collective redundancy. Employers are generally obligated to temporarily reduce working hours or temporarily suspend employment contracts before terminating their contracts outright. |
Voluntary and continued lack of normal or agreed-upon work performance |
| Regular drunkenness or intoxication if it negatively affects the work performed | |
| Other gross misconduct that includes significant and intentional breach of employment duties |
Note: Employees forced to resign due to their employer's breach of contract is considered to have been unfairly dismissed.
Notice Period
Employers are obligated to observe a 15 days' notice period, calculated from when they hand out the written notice of dismissal, when dismissing their employees on objective grounds. On the other hand, employees dismissed for disciplinary reasons can be dismissed without any notice period.
In any case, employees are entitled to a 6-hour weekly leave during their notice period to seek new employment.
Severance Pay
Employees dismissed on objective grounds are entitled to 20 days' salary per year of service, prorating any period of less than a year by month, up to a maximum of 12 months' salary. Those dismissed on disciplinary grounds are not entitled to severance.
Probationary Period
Probation periods must be arranged in writing, and is subject to the following maximum durations:
| Maximum probation period | |
|---|---|
| Qualified technicians | 6 months |
| Other employees | 2 months, or 3 months if the employee works in a company with less than 25 employees |
Employees on probation can generally have their contract be terminated at the request of either party for any reason, though the dismissal of an employee who is pregnant or on maternity leave requires a justification unrelated to their pregnancy or maternity.
Probation period will be terminated if the employee was found to have previously performed the same function in the company, regardless of any differences in contract type.
Work Time Rules
Standard Working Hours
Standard working hours are subject to a maximum of 9 hours per day or 40 hours per week on a yearly average.
Employers may distribute up to 10% of their employee's working hours irregularly throughout the year, provided that the prevailing regulations on minimum daily and weekly rest periods are respected and that the employee is given an advance notice of at least 5 days.
Break Period
Employees are entitled to at least a 15-minute break after 6 hours of continuous work. This period can be considered an effective work time if so established by any collective agreements or individual agreements.
Moreover, employees are also entitled to take a paid hour off work per day to take care of their child until their child reaches 9 months old. This duration will increase proportionally in the event of multiple births or adoptions.
Overtime
Employees can work up to a maximum of 80 overtime hours per year, though this limit can be exceeded if the overtime work is performed to prevent or repair accidents and other urgent damages.
Employees performing overtime work shall be compensated with either an overtime premium (75%) or compensatory rest that can be taken within 4 months of the performance of overtime work.
Weekly Rest Days
Employees are entitled to a rest period of at least 12 hours between workdays and 1.5 continuous days of rest per week, which includes a Sunday and either Saturday afternoon or Monday morning.
Note: An employee's day of rest can be accumulated for a period of up to 14 days.
Holiday and Leave Entitlements
Public Holidays
Employees are entitled to a maximum of 14 paid public holidays per year, payable by the employer. There are 10 days of national holidays that apply uniformly throughout the country in 2025.
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| Epiphany | January 6 |
| Good Friday | April 18 |
| Labor Day | May 1 |
| Assumption | August 15 |
| National Holiday of Spain | October 12 |
| All Saints' Day | November 1 |
| Spanish Constitution Day | December 6 |
| Immaculate Conception | December 8 |
| Nativity of the Lord | December 25 |
Note: Each autonomous communities of Spain may have additional holidays, which shall be in accordance with the publication here.
Annual Leave
Employees are entitled to at least 30 calendar days of paid annual leave. The period or periods of annual leave will be determined by the mutual agreement of the contracting parties based on any relevant collective agreement or the established annual vacation plan of the company.
Employees must generally take their annual leave within the calendar year after they are accrued. However, certain exceptions apply if they are prevented from taking their annual leave by a temporary disability.
| Alternative annual leave arrangement | |
|---|---|
| Temporary disability resulting from pregnancy, childbirth or breastfeeding | Annual leave can be arranged for after the employee’s return, even if the calendar year to which the leave correspond has ended |
| Temporary disability derived from other causes, i.e. sick leave | Annual leave can be arranged within 18 months following the end of the year in which the leave should have been taken |
Sick Leave
Employees may be entitled to receive a temporary disability allowance to cover any loss of income in the event of sickness or accidents. The employer is obligated to apply for the sickness allowance to INSS and pay for the first 15 days of allowances. The rest will be covered by social security.
The amount of sickness allowance is calculated as follows:
| Allowance for common sickness or non-occupational injuries | Allowance for occupational injuries or diseases | |
|---|---|---|
| Allowance for day 1 | - | - |
| Allowance for day 2–3 | - | 75% of contribution base |
| Allowance for day 4–20 | 60% of contribution base | 75% of contribution base |
| Allowance for day 21 onwards | 75% of contribution base | 75% of contribution base |
Note: The maximum duration for the allowance is 365 days, with a possible extension of 180 days.
Maternity Leave
Female employees are entitled to up to 16 weeks of unpaid maternity leave, of which up to 4 weeks can be taken pre-natal, and at least 6 consecutive weeks are to be taken after childbirth.
Any remaining duration of leave after the 6 continuous week taken post-natal can be taken at the employee's will until their child turns 12 months old, i.e. continuously or in several weekly periods, and in full-time or part-time basis, provided that the employer is notified at least 15 days in advance.
The duration of leave may be extended in the event of a premature birth or the child's disability, as follows:
| Extension of Leave | |
|---|---|
| Pre-mature birth or when the child needs to be hospitalized after birth | 6-week post-natal leave can be calculated from when they are discharged |
| Pre-mature birth with a lack of weight, and the child needs to be hospitalized for more than 7 days | Leave is extended by the days of hospitalization required up to a maximum of 13 additional weeks |
| Child's disability at birth | 1 week |
| Child's death | Employee can request to return to work only after taking a mandatory leave of 6 weeks |
Note: In the event of multiple births, the employee may be entitled to an extension of 1 week of leave per additional child.
Paternity Leave
Male employees are entitled to up to 16 weeks of unpaid paternity leave, of which at least 6 consecutive weeks are to be taken after childbirth.
Other Leave
Employees are entitled to the following paid leaves:
| Leave | Duration |
|---|---|
| Accident, illness or death of a family member | 2 days or 4 days if travelling is required |
| Fulfillment of inexcusable public duty, e.g. jury duty, electoral voting, etc. |
As long as needed. If the function is paid, the employer is only required to pay the difference between the amount paid for their public duty and the employee's regular salary. If this requires more than 20% of the employee's regular working hours in a period of 3 months, the employee is deemed to have taken unpaid mandatory leave-of-absence, and will be required to make a request for re-entry within a month of terminating their public obligation before returning to work. |
| Marriage Leave | 15 calendar days |
| Pre-childbirth or adoption leave | As long as needed for pre-natal examinations and childhood preparation, including attending informational sessions, carrying out custody hearing for adoption, etc. |
| Trade union duties or workers' representative activities | Varies according to collective agreement |
| Transfer of habitual address | 1 day |
On top of the above paid leave, employees may also be entitled to the following unpaid leaves:
| Leave | Duration |
|---|---|
| Menstrual Leave | 3 days or 5 days for disabling periods |
| Unpaid Leave-of-Absence (LOA) | For employees with at least a year of seniority to take unpaid leave for at least 4 months, and up to a maximum of 5 years. Rules on the taking of unpaid LOA can be found under Article 46 of the Workers' Statute |
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