Hiring in Spain through an EOR (2026)

Before your first Spanish employee reaches payday, you need either a registered local entity or an Employer of Record (EOR) in place. Spain does not allow foreign companies to put someone on payroll without a legal presence, so an EOR is the practical route if you want to hire quickly without setting up a subsidiary. The employer social security contribution alone sits at 30.57% of gross salary, which makes Spain one of the more expensive countries in Europe to add headcount.

The labour market is large, with a workforce of around 24.5 million people, but unemployment runs at 10.8%, so talent availability varies sharply by region and sector. Collective bargaining coverage reaches 92.1% of workers, meaning the sector-level agreement almost certainly applies to your hire even if your employee is not personally a union member. A 13th-month salary payment is mandatory, the standard work week is capped at 40 hours, and employees are entitled to 30 days of paid annual leave plus 10 public holidays each year.

The headline number driving employer cost in Spain is the 30.57% social security contribution on top of gross salary. Employees also contribute 6.48% from their own pay, but that does not reduce your obligation. Add the mandatory 13th-month salary and the total tax wedge of 41.4%, and you get a clear picture of why the true cost of a Spanish hire is meaningfully higher than the agreed gross salary figure alone.

A few specifics about Spanish employment law deserve close attention before you commit to a hire.

• Employer social security is substantial. At 30.57% of gross salary, this contribution is the single biggest addition to your payroll cost. Budget for it from day one, because it applies from the first employee and does not taper off.
• The 13th-month salary is mandatory. This is not a discretionary bonus. Spanish law requires it, so factor an extra month of salary into your annual cost model for every employee.
• Collective bargaining covers almost everyone. With 92.1% collective bargaining coverage, the relevant sector agreement will set floors on pay, working conditions, and sometimes severance that sit above the statutory minimums. You need to know which agreement applies to your employee's role before you draft a contract.
• Severance and notice periods are real costs. The severance entitlement runs to 15.2 weeks and the statutory notice period is around 2.1 weeks. If a hire does not work out, these are the baseline obligations you are looking at, and sector agreements can push them higher.