Employment law in Spain is built around a single principle: the Workers’ Statute sets mandatory minimums that individual contracts cannot undercut, and collective bargaining agreements can improve on those minimums but never reduce them. Indefinite contracts are the default, working hours are capped at forty per week, dismissals require documented cause, and severance is calculated by formula rather than negotiation. Employers carry most of the procedural burden when disputes arise.
The primary source is Royal Legislative Decree 2/2015, the Estatuto de los Trabajadores.1OEITSS. Regulations It applies to anyone who voluntarily provides paid services under someone else’s direction and inside their organization. Self-employed workers (autónomos), senior management under Royal Decree 1382/1985, and civil servants sit outside it and follow their own regimes.2Tax Agency. Exempt Compensation Derived From the Termination of Special Labor Relationships
Contracts Default to Indefinite
Since Royal Decree-Law 32/2021, the indefinite contract is the default form of employment.3Invest in Spain. Labour Reform A temporary contract that does not meet strict legal criteria is automatically reclassified as indefinite by operation of law.
Fixed-term contracts survive in two main forms. Contracts for production needs cover a genuine, temporary spike in demand and cannot exceed six months, extendable to twelve through a sectoral collective agreement with a single agreed extension. Replacement contracts cover an employee on leave and must name the absent worker and the reason. Anyone who accumulates more than eighteen months of temporary contracts inside a twenty-four-month window with the same employer becomes permanent by law.
Any contract lasting more than four weeks must be written. Every contract has to be registered with the Public Employment Service (SEPE) within ten days.4SEPE. Temporary Contract Skipping the written copy or the registration creates a legal presumption that the relationship is indefinite, on top of exposing the employer to fines. Employers also owe the worker a written document setting out work location, job category, and the applicable collective agreement if those items are not already in the contract.
Trial Periods
A trial period only exists if it is agreed in writing. The statute caps it at six months for qualified technicians and two months for other workers. Companies with fewer than twenty-five employees get three months for non-qualified staff. Temporary contracts under six months are limited to a one-month trial. During the trial either party can walk away without cause or severance, but the worker keeps every other right of the position. Pregnancy, parental leave, and temporary disability pause the clock.
Working Hours, Rest, and Overtime
The maximum ordinary workweek is forty hours of effective work, averaged across the year. A day cannot run longer than nine hours unless a collective agreement or a company-level arrangement with worker representatives distributes hours differently. Between shifts, workers need at least twelve consecutive hours of rest.5Administracion.gob.es. Working Hours, Leave and Holidays
Weekly rest is one and a half uninterrupted days, which may be accumulated over fourteen days. The common pattern is all of Sunday plus Saturday afternoon or Monday morning. Workers under eighteen get at least two full consecutive days off each week.
Overtime is capped at eighty hours a year for full-time workers and is voluntary outside genuine emergencies. Employers compensate it either with pay at a rate no lower than ordinary hours (collective agreements often set premiums) or with equivalent rest time inside four months. Passing the annual cap draws penalties from the labor inspectorate.
A government proposal presented in early 2025 would reduce the ordinary workweek from forty to thirty-seven and a half hours without a pay cut. It is still in parliamentary processing and is not law.6La Moncloa. The Government of Spain Presents the Reduction of Ordinary Working Hours
Pay and the Minimum Wage
Every employer must pay at least the Salario Mínimo Interprofesional (SMI), which the government adjusts every year. For 2026, the SMI is €17,094 gross per year, paid as fourteen tax-free installments of €1,221 per month.7La Moncloa. SMI 2026 – How Much Is the Minimum Wage Increasing By and Who Benefits
The fourteen-payment structure reflects Spanish practice: twelve monthly salaries plus two extra payments (pagas extraordinarias), traditionally in July and December. A collective agreement or the contract can prorate the extras across the twelve months for a higher, steadier monthly payslip that reaches the same annual figure. Payslips have to itemize gross earnings, social security deductions, and income tax withholdings.
Leave Entitlements
Annual Leave and Public Holidays
Workers receive at least thirty calendar days of paid vacation per year. Money cannot substitute for the leave unless the employment ends with days still unused. Many collective agreements add days above this floor. Spain observes eight national public holidays, with autonomous communities and municipalities adding their own, so most workers see twelve to fourteen paid holidays annually depending on the region. These are separate from vacation.
Sick Leave
Common illness or non-work injury runs on a tiered system. Days one through three carry no payment unless a collective agreement or company policy fills the gap, and many do. From day four through fifteen the employer pays directly at 60% of the regulatory base. From day sixteen social security (INSS) or the employer’s mutual insurer takes over; the employer keeps advancing the money and deducts it from social security contributions. The rate is 60% through day twenty and 75% from day twenty-one onward. Work-related accidents and occupational illnesses follow different rules: 75% of the regulatory base from the first day, funded by the employer’s professional contingency insurance.
Parental Leave
Royal Decree-Law 9/2025 extended birth and childcare leave to nineteen weeks per parent, applying to births from August 2, 2024 onward. Each parent’s entitlement breaks into three blocks:
- Six mandatory weeks, taken full-time immediately after birth.
- Eleven flexible weeks, taken in weekly periods (together or with breaks) until the child turns twelve months. Single parents get twenty-two weeks in this block.
- Two childcare weeks, in weekly periods, available until the child is eight. Single parents get four.
Social security pays the full benefit based on the worker’s regulatory base. Workers could begin requesting the added weeks from January 1, 2026. Single-parent families reach thirty-two weeks in total.
Social Security and Income Tax
Employer and employee both contribute to Spain’s social security system, which funds healthcare, pensions, unemployment, and disability. Contributions run off a base derived from gross salary, capped at €5,101.20 per month in 2026.8MicroBank. Social Security Contribution Groups – Guide
For a standard indefinite contract, the employer pays:
- Common contingencies: 23.60% of the base (non-occupational sickness, pensions, maternity and paternity).
- Unemployment: 5.50% for indefinite contracts, 6.70% for fixed-term.
- Professional contingencies: a variable rate set by the industry’s risk classification.
- Wage Guarantee Fund (FOGASA): 0.20%.
- Vocational training: 0.60%.
The employer’s fixed contributions come to roughly 30% of the base before the variable professional contingency rate. The employee’s share is around 6.50%, deducted from wages. Employers also withhold personal income tax (IRPF) on each payslip based on salary and personal circumstances and remit it to the Tax Agency.
Dismissal and Severance
Spanish law sorts dismissals into categories, each with its own procedure and cost. The employer carries the burden of justifying the termination, and procedural mistakes usually raise the price.
Objective Dismissal
An employer can terminate for economic, technical, organizational, or production reasons (ETOP causes). Economic grounds include current or expected losses or a persistent revenue decline across three consecutive quarters compared with the same quarters the prior year. The employer gives fifteen days’ written notice and pays severance of twenty days’ salary per year of service, capped at twelve monthly payments.9OECD. Employment Protection Information – Spain
Disciplinary Dismissal
For a serious and culpable breach, the employer may terminate without notice or severance. Grounds include repeated unjustified absences, insubordination, offenses against the employer or coworkers, and breach of good faith. A written notice must state the facts and the effective date. If the dismissal is upheld, the employer owes only earned but unpaid wages.
Challenging a Dismissal
A dismissed worker has twenty working days from the effective date to challenge the termination. First stop is a mandatory conciliation before SMAC (the Mediation, Arbitration, and Conciliation Service) or its regional equivalent, which pauses the deadline. Any agreement reached there is enforceable and closes the dispute. Otherwise the case goes to a labor court (Juzgado de lo Social), where the employer must prove the dismissal was lawful. The court can classify it in one of three ways:
- Justified (procedente): the employer met every requirement, no added cost.
- Unfair (improcedente): cause was not proven or procedure failed. The employer picks between reinstatement with back pay or increased severance of thirty-three days’ salary per year of service, capped at twenty-four monthly payments. If the employer chooses compensation, back wages (salarios de tramitación) are not owed. Union representatives and worker delegates make the choice themselves.9OECD. Employment Protection Information – Spain
- Null (nulo): the dismissal breached a fundamental right, involved discrimination, or affected a protected worker (pregnant employees, workers on parental or family leave, and similar categories). Reinstatement with full back pay is mandatory. Severance cannot substitute.
The null category is where employers most often underestimate exposure. A dismissal of a pregnant worker, for example, can only be found justified or null. If the employer cannot prove a legitimate reason wholly unrelated to the pregnancy, the dismissal is void.
Collective Bargaining Agreements
Convenios Colectivos fill the space between the statute and the practical needs of an industry or company. Negotiated by unions and employer associations, once signed they bind every employer and worker within scope regardless of union membership.10Eurofound. Collective Bargaining in Spain Coverage is broad because the agreement extends automatically to everyone in the sector.
Agreements operate at national, sectoral, provincial, and company levels. The 2021 reform restored the priority of sectoral agreements over company agreements on core wage matters, reversing a 2012 change that had allowed companies to negotiate below sectoral pay scales. In practice, a company cannot agree to base salaries below the sectoral floor even if both sides prefer it. Many agreements go well beyond the statute on vacation days, shift premiums, and promotion procedures, so any employer in Spain has to identify which agreement covers its activity: it likely governs more of the relationship than the contract does.
Workplace Protections
Health and Safety
The Ley de Prevención de Riesgos Laborales places a broad duty on employers to protect workers from occupational hazards. That means formal risk assessments, eliminating hazards at their source where possible, adapting work to the individual, and keeping pace with prevention technology.11Administracion.gob.es. Occupational Risk Prevention Collective protective measures take priority over individual ones. Workers have the right to information on role-specific risks, adequate training, and periodic health surveillance tied to the hazards of their job. The law imposes heightened obligations for pregnant workers, workers under eighteen, and employees with particular sensitivity to specific risks.
Anti-Discrimination
The Workers’ Statute prohibits direct and indirect discrimination in hiring and during employment. Protected characteristics include sex, marital status, age, race or ethnicity, social status, religion, political beliefs, sexual orientation, sexual identity, gender expression, sexual characteristics, union membership, language, and disability.12Administracion.gob.es. Equal Treatment and Non-Discrimination A dismissal on any of these grounds will be declared null and trigger reinstatement.
Digital Disconnection
Organic Law 3/2018 gives workers the right to disconnect from work devices and communications outside their scheduled hours. Employers must develop internal policies with employee representatives, communicate them to staff, and avoid penalizing workers who refuse to respond during rest time. Fines for non-compliance range from roughly €751 to €7,500.
Hiring Foreign Workers
EU and EEA citizens work in Spain without a permit. Non-EU nationals need a combined residence and work authorization before starting. The employer normally opens the process at the Provincial Aliens Affairs Office by showing either that the role appears on the national shortage occupations list or that no suitable candidate was found through the public employment service (a labor market test).13European Commission. Employed Worker in Spain Once authorization is granted, the residence permit is issued alongside it, and the worker then applies for a work and residence visa at the Spanish embassy or consulate in their home country before traveling. Hiring a non-EU worker without valid authorization draws significant penalties, and the worker’s employment rights apply regardless of immigration status.