The complete guide to offering employee benefits in Spain

Published

Mar 30, 2023

If you plan to hire employees based in Spain, you must offer employees benefits packages that are compliant with the labor laws of their country, which are outlined by the European Union, the Spanish Constitution, the Workers’ Statute (Estatuto de los Trabajadores), and collective bargaining agreements. While Spanish workers receive many benefits through the country’s social security system and other government support systems, employers must also do their part.

This guide will tell you everything you need to know about offering plans that are in line with Spain’s mandatory employee benefits—and how you can go above and beyond to offer even more comprehensive plans for your employees in Spain.

What employee benefits are mandatory in Spain?

Spanish law requires mandatory, base-level benefits. If you don’t offer these to full-time Spanish employees, you could be fined or face other legal ramifications. These benefits are merely the minimum required by the government, and many employers choose to offer more than this as added perks for employees.

These benefits are mandatory only for full-time employees. Contractors are not entitled to benefits under Spanish law.

Before you get started:

  • Spain regulates jobs by professional categories, with different laws around compensation, working hours, and vacation types for those different jobs. Though this post offers general guidance, always make sure that your benefits adhere to the requirements for the job category.
  • Collective bargaining is also extremely common in Spain and may impact the terms of the benefits you offer. Collective bargaining agreements (CBA) can be made at the workplace, company, industry, regional, or national levels.

Pension and social security

With a few exceptions, all Spanish workers and employers must contribute to the country’s mandatory savings plan. Spain’s robust social security program (known as the sistema de seguridad social, or INSS) has one of the highest pension rates in the world and includes many benefits for which, in other countries, employers would normally take responsibility. This includes:

  • Disability
  • Retirement
  • Healthcare
  • Family allowances
  • Unemployment allowances
  • Sickness
  • Death benefits
  • Parental leave (including paternity leave and maternity leave)

The typical contributions for social security vary by job type, but averages for 2023 are:

  • Employers contribute around 30-32% of their employee’s salary, with a contribution ceiling of just over €3,500 per month. Employers may owe more for high-risk work.
  • Employees contribute an average of 6.45% of their salary.

The minimum age for applying for retirement (at which time citizens can begin taking pension) is 65, as long as the citizen has contributed to the pension for 37 years and six months. 

Vacation entitlements

Full-time workers in Spain are entitled to 30 calendar days (22 working days) of vacation annually. In Spain, employees are typically required to use up their vacation in the year it was earned, meaning that vacation days do not transfer to the next year. As a perk, you may opt to allow employees to transfer vacation days. Employers are not allowed to pay workers in exchange for fewer vacation days.

Note that collective bargaining agreements may indicate a different range of vacation days.

Statutory holidays

In Spain, employees are also entitled to 14 days of paid public holidays in addition to their vacation time, which is a mix of national and local holidays. If a holiday occurs on a weekend, then employees typically take off the following Monday.

Leave

Spain has very specific laws around leave. Leave may be paid in full or in part by social security. Note that leave rules may change per collective bargaining agreements.

Sick leave. Employees are not entitled to pay for the first three days of their absence but must be paid a percentage of their salary starting on the fourth day of illness. Typically, employers pay employees 60% of their typical earnings from day four to 15 of their leave, and then 75% from the 16th day onward. After day 16, social security typically reimburses this amount for up to a year.

Parental leave. Parents are given 16 weeks of leave in Spain, with both parents required to take off the first six weeks after the birth. After that initial six weeks, parents may take their additional 10 weeks off at any time within that first year. These rules also apply for fostering and adoption. If there are multiple births or if health issues arise, parents may be able to extend their leave. Social security reimburses parents 100% during their leave.

Employees may take a leave of absence of up to three years to care for their child, though this leave is unpaid.

Other types of leave. Other required leave includes 15 days for a wedding, a day for moving homes, a day for voting, necessary time for jury duty, two for the serious illness or death of a relative, and necessary time for medical appointments.

Benefits that may be mandatory in Spain

Per collective bargaining agreements, you may be required to offer other mandatory benefits.

Workers’ compensation

Workers’ compensation insurance may be required by collective bargaining. This is also known as work accident insurance or “seguro accidentes por convenio.” Workers’ comp can cover your employees if they are hurt or become sick as a result of their work. The insurance may cover medical bills or other benefits. The collective agreement will mandate the extent and type of policy you take out.

What employee benefits are optional in Spain?

The benefits covered so far are the minimum of what employers must provide full-time workers in Spain. Many employers provide additional benefits and perks which can attract and retain employees. This can be a huge advantage, particularly when hiring in competitive fields.

Health, dental, and vision insurance

Yes, though Spanish workers are covered by government healthcare plans under SNS (Servicio Nacional de la Salud), employers often offer supplemental health benefits coverage to fill in the gaps, reduce waiting times, and help with specialized care. Because around 75% of employers provide private medical insurance, it may be a competitive disadvantage to exclude it from your benefits package.

Dental insurance is particularly a common offering, as is travel insurance and access to medical call centers. In lieu of a supplemental health insurance plan, you may consider offering a health benefit allowance. 

Pension plans and retirement savings plans

In addition to the compulsory Spanish pension, you may opt to offer private pension plans or additional retirement savings plans as a perk to help your workers build long-term savings at higher return rates. You could opt to pay for this through employee contribution matching, payroll deductions, or other methods. 

Additional paid time off

Spain has ample mandatory time off for workers. However, if you’re trying to attract top talent in a competitive industry, you may choose to offer additional time off. You may give employees more vacation time, sick days, or personal days, or you may offer a flexible leave policy.

Life insurance

In Spain, it’s common for employers to offer life insurance plans—around 80% of employers offer a lump sum to their employee’s family in the case of their death. Like in the US, this coverage assists a late employee’s family members with the financial impact of their death. Some plans will also include disability insurance alongside life insurance. It’s common for employees to get covered under group life insurance with the employer paying 100% of the premium.

Other popular benefits

Other common benefits for full-time employees in Spain include:

  • Childcare vouchers or other types of care assistance
  • Tax-saving benefits for kindergarten
  • Company cars, car insurance, petrol allowances, or public transportation allowances
  • Work-from-home or flexible work policies
  • Food allowance, food vouchers, restaurant vouchers, or subsidized meals
  • Shopping discounts, gym discounts, or travel discounts
  • Professional training programs, which might include one-off courses or support with getting a master’s degree

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Disclaimer: Rippling and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.

last edited: July 19, 2023

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