Employment Law: HR Management That Protects Your Business

Employment law in Spain (Derecho Laboral) is governed primarily by the Workers' Statute (Estatuto de los Trabajadores, Royal Legislative Decree 2/2015), the Social Security General Law (Ley General de la Seguridad Social, Royal Legislative Decree 8/2015), and a dense framework of collective bargaining agreements (convenios colectivos) operating at sector and company level. Key areas of regulation include individual and collective dismissal procedures — with specific formalities and compensation thresholds — mandatory equality plans for companies with 50 or more employees under Royal Decree 901/2020, daily working-time registration under Article 34.9 of the Workers' Statute, and harassment prevention protocols now compulsory for companies above 50 employees under Law 15/2022 on equal treatment. The Labour Inspectorate (ITSS) enforces these obligations and can impose fines of up to EUR 225,018 per serious infringement.

Our employment team understands that managing human capital goes far beyond legal compliance. We design labour strategies that protect your business, retain talent, and foster a productive, legally secure work environment.

The Hidden Cost of Employment Law Non-Compliance

Spanish labour law is among the most technically demanding in Europe. The Workers’ Statute, the collective bargaining framework, the equality regulations, and the remote-work rules create a dense web of obligations that evolves with every legislative cycle. Non-compliance is not merely a theoretical risk: a single wrongly classified dismissal, an equality plan not properly registered, or a missing remote-work agreement can generate back-payment orders, fines, and reputational damage that far exceed the cost of proactive advice.

Our starting point is always an employment audit — a structured review of your contracts, HR policies, and practices that maps your current exposure and prioritises the most urgent corrective actions. This gives you a clear, actionable picture rather than a generic compliance checklist.

Dismissal Severance: The Numbers That Determine the Decision

The difference between a well-executed and a poorly executed dismissal in Spain is not procedural — it is financial. The Workers’ Statute establishes two severance levels depending on grounds and outcome:

On a 10-year employee earning €40,000 per year, the difference between the two scenarios exceeds €10,000. The choice of dismissal type, the documentation of grounds, and the wording of the dismissal letter are decisions made before the letter is issued. After that, the margin for manoeuvre disappears.

Platform Economy and the Riders’ Law: Spain’s New Labour Risk Map

Additional Provision 23 of the Workers’ Statute, introduced by Royal Decree-Law 9/2021, presumes an employment relationship exists when a digital platform organises delivery workers through an algorithm. But the actual test applied by the courts goes beyond delivery: if a company’s algorithm assigns tasks, sets prices, or evaluates the performance of nominally self-employed workers, there is a reclassification risk — with corresponding obligations to regularise social security contributions, pay severance, and absorb sanctions. We advise companies with flexible workforce models and digital platforms on structuring their arrangements to reduce reclassification risk without abandoning the business models that make them competitive.

Dismissals Done Right

Terminations are the highest-risk area of Spanish employment law. The formal requirements differ by dismissal type, the severance calculations are precise, and the deadlines for challenge are short. A procedural defect — an incorrect date on the dismissal letter, a missing cause in the notice, a failure to consult — can convert an otherwise valid dismissal into an automatically unfair one, triggering higher severance or reinstatement.

We manage every stage: advising on the most appropriate route, drafting the documentation, calculating the settlement, and representing you at the SMAC conciliation and, if necessary, before the Social Court. For collective procedures involving restructuring, we lead the consultation period with employee representatives and coordinate with the labour authority to ensure a legally sound outcome.

Workforce Strategy in Corporate Transactions

When companies are acquired, merged, or restructured, the workforce dimension is often the most legally complex. Article 44 of the Workers’ Statute subrogates employment contracts automatically on a business transfer, and the acquirer inherits all existing liabilities. Our employment team integrates with our due diligence process to quantify workforce contingencies, identify unregistered employment relationships, and advise on post-closing integration strategies.

Building a Compliant, Attractive Employer

Beyond risk management, employment law is a tool for building a workplace that attracts and retains talent. We help you design equality plans that go beyond compliance to address real pay gaps, flexible-remuneration packages that optimise take-home pay with tax efficiency, and remote-work frameworks that give employees certainty while protecting management prerogatives. The result is a company that competes on quality of employment as well as salary.