Hiring in Spain: A Practical Guide for International Companies

Spain has become one of Europe’s most popular places for international companies to build teams, whether they are headquartered in Germany, the Netherlands, the US or the UK. It has a large, well-educated talent pool and lower salaries than Europe’s other big tech hubs, and it shares a time zone with most of Europe. But Spanish employment law has its own rules, and they matter from the very first hire.

This guide covers the basics international companies need to know before hiring in Spain in 2026: how to employ people, what contracts look like, what employees cost and how employment ends. It is a practical overview, not legal advice, so always check the details with a Spanish employment lawyer or adviser before you hire.

What changes depending on where you are based

Most of this guide applies to every employer, but a few things depend on where your company is based:

• Companies elsewhere in the EU, such as Germany or the Netherlands. EU citizens can live and work in Spain without a work permit, so moving people between your offices is simpler. But someone who lives and works in Spain is normally covered by Spanish social security and employment law, even if your contract is written under German or Dutch law.
• US companies. There is no at-will employment in Spain. Contracts are presumed to be permanent, dismissals need a legal reason and usually come with severance, and holidays and parental leave are far more generous than most US employees are used to. A US company can register directly as an employer in Spain, but it must appoint a legal representative based in Spain (Parakar), so most start with an Employer of Record or a Spanish subsidiary.
• UK companies. Since Brexit, UK companies are in the same position as other non-EU employers, and UK nationals need a work permit to work in Spain.

Wherever you are based, one employee working from Spain can also raise tax questions for your company, such as whether you have a permanent establishment there. Take local tax advice before your first hire.

1. Decide how you will employ people

To employ someone in Spain, you need a Spanish employer. There are three common routes:

• Set up a Spanish company. A sociedad limitada (SL) gives you full control and usually makes sense once you plan to build a sizeable team in Spain. It takes time to set up and needs local payroll, accounting and tax support.
• Use an Employer of Record (EOR). An EOR employs people on your behalf and handles contracts, payroll and social security, while you manage the day-to-day work. In Spain, an EOR must operate as a licensed temporary employment agency (Global Expansion). It is the quickest way to make your first few hires.
• Engage contractors. Some companies start with self-employed contractors (autónomos). Be careful: if someone works like an employee, with set hours, your equipment and you as their main client, they can be treated as a “false self-employed” worker (falso autónomo). That can lead to claims for unpaid social security and employment rights.

2. Contracts and probation

Since Spain’s 2021 labour reform, the indefinite (permanent) contract is the default. Fixed-term contracts are only allowed for specific, justified reasons, so plan to hire on permanent contracts.

Most roles are also covered by a collective agreement (convenio colectivo) for the sector and region. These agreements can set minimum salaries, working hours, probation periods and extra leave, so check which one applies before you write an offer.

A probation period (periodo de prueba) must be agreed in writing. It can usually last up to six months for qualified technical staff and two months for most other employees, unless the collective agreement says otherwise. During probation, either side can end the contract with no notice and no severance (Teamed). Use it well: set clear goals for the first months and review them before probation ends.

3. Salary and employer costs

• Annual gross, paid in 14 instalments. Salaries are agreed as an annual gross figure and are usually paid in 14 instalments, with two extra payments in summer and at Christmas. They can be spread across 12 months if the collective agreement allows (Teamed). A €60,000 offer means €60,000 a year in total, not €60,000 plus two extra payments.
• Employer social security. Budget around 30–32% on top of gross salary. The fixed employer rate on a permanent contract is 30.65% in 2026, plus an occupational accident rate (about 1.5% for office work), on earnings of up to €5,101.20 a month (PwC). Above that cap, the main contributions stop and only a small solidarity contribution applies.
• Income tax. Income tax (IRPF) is withheld through payroll each month. Your EOR or payroll provider handles the filings.

4. Working time and leave

• Annual leave: at least 30 calendar days a year, which is about 22 working days, plus national, regional and local public holidays (usually 14 a year).
• Working hours: the legal maximum is 40 hours a week, averaged over the year. Many collective agreements set fewer. A proposal to cut the legal maximum to 37.5 hours has not become law.
• Time recording: employers must keep a daily record of each employee’s working hours, including for remote staff.
• Parental leave: each parent is entitled to 19 weeks of paid leave for the birth and care of a child (Teamed).

5. Ending employment

If you are used to at-will employment in the US, or the UK’s two-year qualifying period for unfair dismissal claims, Spanish rules will feel strict: once probation ends, employees are protected against unfair dismissal straight away. The main rules (Teamed):

• Objective dismissal (for economic, technical, organisational or production reasons): 15 days’ written notice and severance of 20 days’ salary per year of service, up to 12 months’ salary.
• Unfair dismissal: if a court finds a dismissal unfair, the employer must either reinstate the employee or pay 33 days’ salary per year of service, up to 24 months’ salary.
• Disciplinary dismissal for serious misconduct carries no severance, but it must be properly documented and is often challenged.
• Resignation: employees usually give 15 days’ notice, or the period set by the collective agreement.

This is why getting the hire right, and using probation well, matters so much in Spain.

6. Work permits and relocation

Citizens of EU and EEA countries, such as Germany or the Netherlands, and Switzerland can work in Spain without a permit; if they move, they register as residents. Everyone else, including US and, since Brexit, UK nationals, needs a work permit. For skilled roles, the fastest routes are the highly qualified professional permit and the EU Blue Card, which the Large Companies Unit (UGE) decides within 20 working days. The 2026 minimum salary for the highly qualified route is €41,356.36 a year (Migratiolex).

People who move to Spain for work may also qualify for the Beckham Law, which lets them pay a flat 24% income tax on employment income of up to €600,000 a year for six tax years, as long as they have not been tax resident in Spain in the previous five years (TaxDown).

A checklist before your first hire in Spain

• Choose your route: a Spanish entity, an Employer of Record or, carefully, contractors.
• Find out which collective agreement applies to the role.
• Benchmark the salary and budget 30–32% on top for social security.
• Agree the contract, probation period and first-month goals in writing.
• Check work permits for anyone who is not an EU citizen.
• Set up payroll, time recording and a bilingual Spanish–English contract.

How Global M can help

Global M is headquartered at Barcelona Tech City, with an office in Madrid, and has helped international companies hire in Spain since 2012. With an Embedded Hiring Team, a dedicated Talent Partner runs your Spanish hiring end to end, from salary benchmarking to signed offer, and can work alongside your Employer of Record. For a single key role, Success-Based Hiring means you only pay when you hire.

For salary benchmarks, see the real cost of hiring tech talent in Spain and our guide to hiring AI engineers in Barcelona.