Spain Professional Employer Organisation (PEO) Services

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Spain Professional Employer Organisation (PEO) Services

There’s somewhat a constriction on employment in Spain – certain occupations tend to be grouped into various categories which have their own regulations. These impose salary ranges, working hours, yearly vacation allocations and so on.

The Spanish workers likes to opt for indefinite contracts because as these make being laid off more difficult and with higher compensation packages into the bargain. Thrashing out the right indefinite contract can be as important to employees as salary negotiations.

The normal working week in Spain runs to a 40 hours and the minimum required vacation period is 30 calendar days – or 23 paid business days per year. In effect, holiday time cannot be pagado – paid out. There are also no standard sick days. 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 or she will be paid at least 60 percent of normal wages.

The employer can actually be reimbursed for sick pay by the state 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.

Indefinite employment contracts favoured: keep jobs safe yet come with big compensation deals.

A new mum can get 16 weeks paid maternity leave, the first six weeks of which must be taken after the birth. To be eligible for maternity leave, the mother has to have registered with the social security office and have made contributions for a minimum of 180 days during the prior seven years or a total of 360 days during their career. A year of unpaid leave is also granted after the paid leave is taken and the mother’s job has to be guaranteed on return. She can take an additional two years of unpaid leave, but her employer does not have to offer her old job back on her return to work. Paternity leave is 30 days, with additional days allowed if there were complications for the mother or the baby.

There’s a probation period of six months for qualified technicians – just two months for other workers – which is subject to written agreement in the employment contract, which is then filed at the local employment office. With indefinite work contracts in Spain, with no trial period in place and without other specific agreements – an employment contract can be terminated: by mutual agreement between the parties, for reasons mentioned officially in the contract, on resignation of the worker, death, serious or permanent invalidity, total or absolute invalidity, retirement of the worker, retirement or invalidity of the contractor or at the end of their legal status, by collective dismissal (economic, technical, organisational or on production grounds), by express wish of the worker on justified grounds, dismissal on disciplinary grounds, and legally admissible objective causes.

In practice, when an employer assesses that an employee is poorly suited for the role, they 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 – that’s basically one month of salary for every year worked with the company. If a company wants to terminate employment, it should expect to pay one additional month in lieu of notice, over and above the severance fee. Staff who believe they have been terminated unfairly may contest against their termination at a labor tribunal.

Companies pay social security tax equal to 29.9 percent of the employee’s salary up to a wage ceiling of EUR 3,596.98. Health insurance is funded through social security taxes but supplementary health insurance may be provided by an employer to an employee as a benefit. Most executives request supplementary health and life insurance. A small company may provide an allowance in lieu of arranging insurance.

Spanish workers get 15 days for marriage (!), two days for the death of a family member, and a day for moving home.

With employment contracts in Spain, because the labor law is relatively strict, it’s a legal necessity to put a strong, written contract in place clearly setting out the terms of the employee’s compensation, benefits, and termination requirements. The contract should also state the salary and any compensation amounts in Euros rather than foreign currency.

Agents of Bradford Jacobs are totally on the ball to make your expansion into Spain processes painless and easy. We can help you hire your candidate of choice, handle HR matters and payroll, and ensure that you’re in compliance with local laws – all without the expense of setting up a branch office or subsidiary. Our agents in Spain and our worldwide Employer of Record Platform is designed to provides you with piece of mind, allowing you to concentrate on running your business.

With Bradford Jacobs’ in-country legal experts and our experienced and trained staff, we can guide you smoothly through the many of complex laws and regulations of hiring staff in Spain. When negotiating terms of an employment contract and sending a job offer letter to an employee in Spain, it is a legal requirement to put a strong employment contract in place, in Spanish as well as English, which sets out the terms of the employee’s compensation, benefits, and termination requirements. An offer letter and employment contract in Spain should always state the salary and any compensation amounts in Euro rather than a foreign currency.

Here’s some hugely attractive reasons you should use Bradford Jacobs’ agency services in Spain:

  • You have a contractor overseas and you want to take them on full-time as a company employee.
  • As they’re a contractor, your company is currently in a non-compliant relationship with them.
  • Your company wants to invest in these resources and show your commitment to them by offering then full-time work under your company banner.
  • The contractors are asking for the improved status afforded by full-time employment.
  • You’re seeking cost-effective solutions in upgrading contractors to employee.
  • Legal complications need to be avoided when converting contractors to employees.
  • Avoid the costs and risk of maintaining a foreign corporate entity. You see that the compliance and financial perspective as it stands is too high in terms of investment and just does not tie-in with your long term goals.
  • It needs to be done quickly. You’d like to hire today, but are in need of an interim solution while setting up your foreign entity

Well, our single answer to all of these dilemmas is – no problem!

For companies wishing to hire employees in Spain, our expert advisors can walk you through the nuances of employment and hiring in Spain – and indeed in every other European state. Within just 24 hours following your initial call to us, Bradford Jacobs will send you a customised proposal to match your exact specifications and requirements. You can have your employees up and running within a few days of the paperwork being signed and sealed.

Remember, whether foreign national expatriates or local national hires, Bradford Jacobs can assist with Spanish business visas, work permits, local payroll, taxes, and general employment support. Our services will drastically decrease your time to market, fully compliant and without the hassles and headaches.

If you’re considering engaging a PEO, we suggest you first check out what Bradford Jacobs Consulting can offer…

How Spain PEO works

Our aim as the Employer of Record for your international employees is to provide specific payroll, HR and ‘in-country’ compliance services.

In the first instance, Bradford Jacobs professionals will consult with you to understand your specific requirements and timeframes and assess the best model to provide our services. As these are co-employer and employee arrangements, there will be some important conditions for you to consider so that the PEO model remains accurate, timely and – most importantly – compliant with the rules and regulations governing staff employment in a specific country.

The most important thing we do is protect our clients and their workforce – which makes Bradford Jacobs the reliable partner you would want to work with.

Spain PEO Service Overview

Bradford Jacobs Consulting provides employer of record services for clients that want to hire employees and run payroll without first establishing a branch office or subsidiary say, as an example, in Spain. Your candidate is hired via Bradford Jacobs agencies in Spain in accordance with local labor laws and can be set up within a few days. One of our experts is assigned to work with your team, representing your company exactly as if he or she were your employee and working to meet your requirements in that country.

Our PEO service enables clients to run payroll in Spain while HR services, tax, and compliance management matters are lifted from their shoulders onto ours. As global PEO professionals, we manage employment contract best practices, as well as severance issues and even termination if required. We also keep you up to date of any changes to local employment laws in Spain.

Establishing a branch office or subsidiary in Spain to engage a small team is time consuming, expensive and complex. Spain labor law has strong worker protections, requiring great attention to detail and an understanding of local best practices. Our global partners make it problem-free and an easy exercise to expand into Spain. We can help you hire your candidate of choice, handle HR matters and payroll, and ensure that you’re in compliance with local laws – all without the burden of setting up a Spain branch office or subsidiary outfit.

Features and Benefits

Solutions available for all nationals.

Employment and business support provided by local professional partners.

Contractors benefit from the highest legitimate retention through the use of tax and social security treaties, expatriate tax regimes, pension schemes, double taxation agreements and tax claimable expenses.

Value for money and flexible fees – inclusive of a Spanish tax return and expenses claims. These are charged only when the contractor is starts working. If contractors wish to use their own accountants to file income tax returns, we pay their accountants’ fees up to the amount charged by our own accountant.

EUR 5,000,000 cover for employers’ and business liabilities.

Single point of contact, so contractors can focus on their job.

Extensive expertise in Spain tax and social security issues.

For the Employer

  • Fast international employee engagement solution.
  • Controls operating budgets as all employer costs are provided at the outset to ensure full transparency.
  • Time efficient with minimal paperwork required compared to the red tape often encountered when setting up your corporate entity.
  • Professional assistance with employment and compliance matters.
  • Reduced legal and accounting costs.
  • All statutory professional insurances are provided as part of the Bradford Jacobs service.

For the Employee

  • Compliant local employment contract.
  • Payroll on-time and 100 percent accurate.
  • Professional HR assistance with employment related enquiries.
  • Up-to-date information on tax regulations and compliance.

Contract of Employment

  • Each worker is issued with a comprehensive contract of employment in dual language – in this example case, Spanish and English.
  • An overview of the statutory provisions in Spain will be made available to you prior to contract offer. Bradford Jacobs will appraise you of all the salient in-territory HR rules to ensure you have a thorough understanding of Spanish laws and protocols.
  • In conjunction with in-country expert advisors, Bradford Jacobs will recommend where these provisions can easily be enhanced enabling you to provide a fully competitive salary and benefits package for all your employees.
  • Salary, commissions/bonuses and all benefits are agreed with the ‘workside’ employer and are contractually included.


  • Fully managed service to assist with routine HR tasks such as absence management and expense processing.
  • Guidance on in-territory compliance requirements – such as any legal obligation to record time and overtime provisions.
  • Ad-hoc support available around the clock to support you when you need it most in the event of any disciplinary, grievance or other HR matters requiring urgent attention.
  • Regular updates provided and advice available to ensure that you are made aware of not only significant changes to existing laws but also to ensure ongoing compliance with all aspects of Spain employment law.
  • Bradford Jacobs will bring any issues to your early attention and, where appropriate, work with you to ensure internal policies and handbooks are updated accordingly.
  • Accident insurance covering occupational accidents, commuting accidents, and occupational diseases as required by Spain law is provided as standard.

Payroll & Settlement

  • Fully compliant international payroll funding process ensuring that employees and competent authorities are paid on time, electronically into the relevant bank accounts
  • Statutory filing, submissions and end of year reporting completed as standard.
  • Liability payments made in line with local territory requirements to the respective competent authorities well in advance of deadlines.
  • Staff payments made to employees on a fixed weekly/bi-weekly/or monthly basis as required in local currency.
  • Electronic pay slips provided to employees.
  • We hope that you enjoy a long and mutually beneficial relationship with all your employees. If your employee decides to move on, however, you can rest assured that all leaving documentation required by him or her will be issued efficiently. According to the labor law of Spain, your employees will be at risk of having their work permit revoked if they (i) do not perform the works for which they are employed and (ii) lose vital qualifications that are required to execute the job.
  • Our Bradford Jacobs’ employment solutions helps you have your mobile workforce officially employed in Spain by our company instead of setting up your own legal entity there. You just choose the right candidate that you need to have working for you in Spain and then leave it to us to handle all the rest – fast and hassle-free.


Once the contractor registers with us, we take care of all work-related permits and registration formalities. He or she sends us completed time sheets and any approved expenses. We invoice the end client. When the invoice is settled, we deduct all contributions due to the Spanish authorities and transfer the remaining salary into the contractor’s bank of choice.

Finally, at the end of the financial year, we prepare the year-end accounts and, at the end of the assignment, we de-register the contractor.

We appreciate each situation and business is different. That is why Bradford Jacobs offers a consultative and bespoke solution to every client. Personalised job specifications, job offers and benefits packages are all agreed with you during the set-up process. We know one size does not fit all and rest assured we can accommodate all bespoke requirements.

Sounds good? Then do contact us to arrange an initial Professional Employer Organisation consultation with our team.