Employment Lawyer for Companies in Madrid: Defence and Prevention in Spain's Most Complex Labour Market

Employment law practice in Madrid operates within Spain's largest concentration of Social Courts (Juzgados de lo Social) and the highest inspection activity of the Labour Inspectorate (ITSS) in the country. Companies based in Madrid are subject to the Workers' Statute (Estatuto de los Trabajadores, Royal Legislative Decree 2/2015), applicable collective bargaining agreements — many of which are Madrid-specific or sector-specific with national scope — and the regulatory requirements of the Madrid Community for certain employment obligations. Collective redundancy procedures (ERE — Expediente de Regulación de Empleo) must be notified to the Madrid Employment Authority (Servicio Público de Empleo Estatal) and follow the procedure established by Royal Decree 1483/2012, with strict formal requirements and consultation periods.

Why employment law in Madrid requires specialisation in its judicial and inspection environment

Madrid is Spain’s largest labour market. With more than 3.5 million workers in the Comunidad de Madrid, the capital’s Labour Inspectorate carries out more control actions than any other province in the country. The Madrid Social Courts — more than 30 specialist courts — resolve tens of thousands of proceedings each year, with established case law that conditions the outcome of every dispute.

For companies, this means that labour risks in Madrid are systematic and predictable — if you know where to look. The most common inspection triggers are well-known: absence of working hours records, failure to monitor subcontractors’ compliance with employment regulations, irregular apprenticeship and training contracts, false self-employment arrangements, and remote working without a compliant written agreement under Law 10/2021. An employment lawyer with Madrid experience knows these inspection patterns and can anticipate them before they are activated.

Our Madrid employment team: prevention, negotiation and judicial defence

Our employment law team in Madrid operates on two simultaneous levels: prevention and defence. On the preventive level, we audit the company’s employment structure and regularise the elements most exposed to the Labour Inspectorate. On the reactive level — when a dismissal claim, inspection file, or collective dispute has already arisen — we defend with rigour and knowledge of the specific criteria of the Madrid Social Courts and the Superior Court of Justice of the Comunidad de Madrid.

On labour compliance, we coordinate with our data protection and criminal compliance teams to ensure the company has all employment-related compliance fronts covered: working hours records, anti-harassment protocol, whistleblowing channel, and remote work policy.

Employment bodies and authorities in Madrid that every company must know

• Labour Inspectorate (ITSS) in Madrid: Spain’s most active inspection unit. Actions can begin ex officio, on employee or union complaint, or following a collective dispute.
• SMAC: the mandatory conciliation body for most individual disputes. The company’s position at SMAC conditions the litigation strategy.
• Madrid Social Courts: over 30 specialist courts, with established case law on dismissal nullity, documentary evidence assessment, and procedural timescales.
• Madrid Superior Court of Justice (TSJ): second instance in social matters for the Comunidad de Madrid, with relevant case law on collective redundancies and trade union rights.
• Directorate-General of Labour: national labour authority for EREs affecting workers in more than one region.

What our employment advisory for businesses in Madrid includes

Hiring and workforce structure: contract drafting and review, hiring modalities, temporary-to-permanent conversions, flexible remuneration models, and equality plans.

ERE and ERTE: programme design, consultation period, causal documentation, negotiation with employee representatives, and notification to the labour authority.

Individual dismissals: pre-dismissal advice, dismissal letter, SMAC attendance, and defence before the Social Courts.

Labour Inspectorate: responses to information requests and infringement records, administrative defence before the Government Sub-Delegation, and judicial proceedings before Administrative Courts.

Collective relations: company-level collective bargaining, union election management, information and consultation rights, and collective disputes.

Contact our Madrid employment team for an initial diagnostic meeting at no cost. We will identify your company’s main employment risks and propose the most efficient coverage model. You can reach us through our Madrid office or directly from here.

Employment Compliance in Madrid: Labour Inspectorate Activity and Key Risks

The Labour Inspectorate (Inspección de Trabajo y Seguridad Social) has significantly intensified its control activity over recent years. For companies headquartered or with significant operations in Madrid, the principal risk areas include: undeclared or underreported employment relationships (particularly in service-sector and outsourcing contexts), non-compliance with equal pay obligations under Royal Decree 902/2020, irregular use of fixed-term contracts (especially since the 2022 Labour Reform tightened the conditions for temporary hiring), and failures in occupational health and safety documentation.

The 2022 Labour Reform (Royal Decree-Law 32/2021) fundamentally reshaped the Spanish temporary employment framework. The two general temporary contracts (obra y servicio determinados and eventual por circunstancias de la producción) were replaced by a restructured system that dramatically limits the circumstances in which fixed-term employment is lawful. Non-compliant use of temporary contracts beyond the permitted causes or durations now results in automatic permanent contract status. Companies with Madrid workforces that have not fully audited their contract portfolio against the reformed framework are carrying significant reclassification exposure.

Collective Dismissals and Restructuring: Madrid Considerations

For workforce restructuring that meets the ERE thresholds (affecting 10 or more workers in companies with fewer than 100 employees, or at least 10% of the workforce in larger companies), the consultation period with worker representatives and the documentation presented to the SEPE and the labour authority must meet strict procedural requirements. In Madrid, the relevant authority for EREs affecting workers in more than one autonomous community is the Directorate-General of Labour (Dirección General de Trabajo), which applies the most demanding interpretive standards in Spain.

The consultation period — minimum 15 days for companies with fewer than 50 workers, 30 days for larger companies — requires a documented causal justification (economic, technical, organisational, or productive), a proposed timetable for dismissals, economic criteria for selecting the affected workers, and details of the compensation offered. The position taken in the consultation period conditions any subsequent judicial challenge: a poorly documented ERE procedure is a litigation liability that will be expensive to defend. We design ERE processes from the first strategic assessment through to the authority notification and the individual dismissal letters.

Equality Plans and Pay Transparency Obligations

Under Royal Decree 902/2020, companies with 50 or more workers are required to register a pay audit with the SEPE, conduct periodic pay gap analysis, and take corrective measures where unjustified gender pay gaps are identified. Equality plans are obligatory for companies with 50 or more employees, with specific requirements on content, consultation process, and monitoring mechanisms.

The LISOS (Law on Social Infractions and Sanctions) sanctions for equality plan non-compliance range from EUR 751 to EUR 225,018 for the most serious violations. Labour Inspectorate scrutiny in this area has increased substantially: equality plan inspections are now a routine part of labour authority activity in Madrid. We design, register, and maintain equality plans and pay audits that withstand inspectorate scrutiny.