The labour market

Have you arrived in Barcelona and are looking for work? Here we explain a few features of the job market and provide you with advice and information on resources that may help you in your job hunt.

How does the labour market work in Barcelona?

The Barcelona area is currently offering job opportunities in sectors such as artistic and creative industries, leisure and entertainment, hospitality and tourism, construction, commerce, logistics, telecommunications, and information and communication technologies (ICTs).

There is also high demand for highly qualified and specialist profiles, especially in the technology field.

Foreign nationals with managerial experience or skills in such profiles can find interesting work in the Barcelona area. What is more, if certain specialist jobs are not covered by local workers, immigration legislation allows non-EU citizens, subject to certain requirements, to obtain work permits.

It is important to be aware that the requirements for hiring a foreign national in Spain vary according to nationality, as Spain has bilateral agreements with some countries that make it easier to obtain a work permit in Spain.

However, if you have just arrived in Barcelona and you want to learn about how the job market works and the basic rules to be aware of when choosing your first job in Catalonia, you will find the basics below: types of work contract, payslips, rights and obligations regarding the tax office, social security and the ways to do your job.

Do I start with a work contract or as a self-employed person?

Work can be carried out through an employment relationship (work contract) or a commercial contract, if instead of working for someone else, you decide to start your own company.

Work contract (employment relationship): a worker provides services who receives payment from an organisation or from another person, whether a natural person or a company, working solely for that employer, using the physical and organisational resources of that employer in exchange for an economic consideration known as a salary.

A self-employed person is someone who carries out an economic or professional activity for which they have sole responsibility, using their own material and organisational resources. They are not subject to the instructions of another company or person hiring them. This means they can freely decide on their schedules and how they organise their work. They are paid directly the price of their services as per the work contracted.

The regulation of an employee is different to that of a self-employed person. The regulations governing the rights and obligations of employees is extremely robust, but self-employed workers do not have the same protection. It is important for you to assess your own situation prior to registering as a self-employed person if you are actually going to be hired by a company on a regular basis. It is also important for you to be aware that you cannot choose whether you are self-employed or an employee, as the Spanish authorities will be able to verify that you are correctly registered according to the nature of your activity, whether you are self-employed or an employee, at any time.

Thus, if you are going to provide services for a company or an individual, under their direction and acting on their instructions, in line with an established timetable, using the materials and resources of the company or individual for whom you work in exchange for a salary, you must generally have a contract of employment.

If I decide to work as a self-employed person, can I get any assistance?

There is currently a range of support for entrepreneurs to promote the start of professional activities, as self-employed persons, such as low fixed rates during the initial phases of your business. Barcelona Activa can help you with this process. Learn more about their services for entrepreneurs.

In addition, the law also establishes reductions in Social Security contributions for people who are registering as self-employed for the first time, or who have not been registered as self-employed in the two preceding years.

What regulations protect me as a worker?

The Workers’ Statute is the legal framework regulating the obligations and minimum rights of workers who work for another person or company, under contract.

The same statute states that the most representative business associations and trade unions in each sector may form agreements or collective labour agreements stipulating the working conditions, rights and obligations applicable in a particular sector or territory.

These regulations must be complied with by employers and workers. Worse conditions cannot be put in place than those stated in the Workers’ Statute.

These collective labour agreements also stipulate the minimum payment for workers in each sector. This depends on the professional category of each worker, which in turn depends on the type of training and education they have received, the work carried out, and the level or responsibility or autonomy, together with other factors. Furthermore, if there is no collective labour agreement in force in your company, you should be aware that in Spain there is a national minimum wage (NMW) approved by the government, and that you can also consult statistical data on average salaries by sector and age in Barcelona.

It is important to bear in mind that minimum wage agreements established by collective bargaining refer to full-time contracts. This means that if you have a part-time contract, you will be paid the proportional part of the stipulated amount.

Moreover, these rates established by collective labour agreements, are, like the NMW, minimum rates, so you may be able to negotiate a higher salary with your future employer. To find out what sort of salary you can ask for from your future employer, it is advisable to check average salaries by type of activity.

Labour relations are regulated by what the parties (employers and workers) establish in the employment contract. The employment contract must not provide for worse working conditions than those established in the Workers’ Statute or in the applicable collective labour agreement. Any pact that goes against workers’ rights as established in the statute or collective labour agreement will be considered null and void by the courts. They will therefore not be regarded as applicable or enforceable.

Therefore, it will be the employment contract that establishes the fundamental conditions of the employment relationship, in accordance with what has been agreed between the company and the employee. Furthermore, if an applicable collective labour agreement is in place, this will establish the rights, conditions, obligations and possible sanctions that apply to the employment relationship in all matters not covered by the employment contract. These rights and obligations will always be conditions that are equal to or better than those stipulated in the Workers' Statute. In all matters not regulated by a collective labour agreement or in the absence of such an agreement, the Workers' Statute will be the norm that governs the rights, obligations and other conditions of the employment relationship.

What type of contract can I be given?

There are different kinds of contract that can be used to formalise the employment relationship. The most common is an open-ended contract (one that has a start date but no end date), and it may be full-time (40 hours per week) or part-time (for a certain number of hours per day, per week, per month or per year that amount to less than those of a full-time worker).

Workers can also be hired in the following ways:

For a specific period of time: a temporary contract to cover specific circumstances of production, or to act as a substitute during the absence of another worker.
Through training contracts to obtain professional experience in line with levels of study completed, or to make the work activity compatible with the studies currently being pursued.

Unless otherwise stipulated by the collective labour agreement, the probationary period may not exceed six months for qualified technicians, and two or three months (depending on the size of the company) for other employees. In the case of temporary contracts lasting less than six months, the probationary period may not exceed one month, unless otherwise stipulated in a collective labour agreement.

Employment contracts may establish a probationary period. During this period, the employer or the worker may terminate the contract without prior notice. The length of the probationary period is limited by each collective labour agreement, in line with the category and type of contract, and in the absence of such an agreement, by the Workers' Statute.

What is a payslip?

The remuneration that an employer pays a worker is called a salary, and must appear on the payslip that every worker must receive as proof of payment at the end of the month - in either paper or electronic format - with a clear and detailed breakdown of payment amount, Social Security contributions and personal income tax (IRPF) paid.

The payslip must include the identification number of both the employer and the worker. It must also include the period to which it refers (normally, the corresponding month or days in that month).

The payslip must include both salary payments (such as basic salary, supplements, seniority or company enhancements) and non-salary payments (such as expenses or transport allowances). These are often expenses that the worker has accrued while carrying out their work.

On the whole, remuneration is usually in the form of money. However, work can also be paid by other means, such as, through the assignment of a vehicle or residence, or by paying for various services for the worker (health or life insurance, childcare, restaurant vouchers, etc.). This type for payment is generally known as payment in kind, and can never be more that 30% of salary. The part of the salary paid in monetary form cannot be less than the current national minimum wage.

In all cases, the payslip must reflect all payments regulated by the collective labour agreement applicable to the specific professional category and/or job role. For this reason, you should consult the collective labour agreement applicable to the company (usually stated in the employment contract) and check if the payslip includes all payments stipulated in the collective labour agreement. You should also check the salary tables that often appear at the end of every agreement to see whether you are being paid in line with the role for which you have been hired.

Furthermore, in Spain salary also includes two extra payments, although the applicable collective labour agreement may establish a right to more than two extra payments. In other words, the salary is divided into fourteen monthly payments. However, it is often agreed in the employment contract that these extra payments are to be paid pro rata with each month's salary. This means that twelve monthly payments will be received, to which the proportional part of the extra payments will be added.

In the event that the extra payments are received pro rata, the payslip must show the amount that corresponds to those prorated extra payments.

However, it should be remembered that there are some agreements that prohibit payments being made on a pro-rata basis over twelve months and oblige the payment of extraordinary pay in other periods (for example, the Christmas payment in December, and the summer payment in June).

The period to lodge a dispute regarding missing pay is 1 year.

If you want to learn more about the labour agreement applicable to your activity or company, you can do so by visiting the Generalitat de Catalunya’s agreement search tool. You can also find the applicable labour agreement on the Ministry of Labour and Social Economy’s Collective Bargaining Map.

What is the social security system and who pays into it?

The Social Security system is a set of systems through which the state affords the appropriate protection to those people included in its scope of application, in circumstances and situations defined by law.

The Social Security system forms part of the state administration. The Ministry of Inclusion, Social Security and Migration is responsible for developing Social Security policies.

Among other functions, the Social Security is responsible for paying benefits or pensions for old age, widowhood, orphanhood, temporary disability, permanent disability, and others.

To pay for this, all business owners and workers must pay into the Social Security system, by making what is known as a contribution. The level of contributions is based on workers’ salaries.

The contribution payable on employees' salaries is in two parts: one that is paid exclusively by the employer, known as the employer's contribution, and one that is paid by the employee, known as the worker's contribution.

The worker's contribution is deducted from the employee's salary as detailed on the monthly payslip, and the employer pays this amount to the Social Security, together with the employer's contribution. The employer's contribution is an amount that the company must pay based on the employee's salary.

The contributions payable by the company and by the individual employee are determined by applying percentages known as contribution rates, which are approved annually by the government. These are applied to a contribution base, which is the total remuneration (with some particularities and exceptions) and is in line with minimum and maximum limits established by the government.

The employer's contribution is usually around 31% of the employee's salary, and is paid in full by the company. This percentage may vary depending on the company's business activity. The employee’s contribution, i.e. the part that is deducted from their salary, is 6.35% or 6.40% of that salary, depending on whether the contract is permanent or temporary.

In certain cases, and in order to encourage the hiring of certain groups, the state applies a discount on the contribution of certain workers in the form of a rebate or reduction of the Social Security contribution to be paid. This varies according to the type of contract agreed (interim, conversion of an internship contract into an open-ended one) or the group whose recruitment is encouraged (victims of gender or domestic violence, workers in a situation of social exclusion, long-term unemployed workers, etc.).

What benefits do I get from the social security system?

By contributing to the Social Security system, workers receive the protection afforded by the system in a range of situations:

In the event of becoming ill through no fault of their own, the worker will receive a temporary incapacity benefit. In this case, a doctor registered with the Social Security system must provide a document authorising sick leave - this is required in order to receive this benefit. If the reason for the sick leave results from an accident or illness resulting from work, it will be the work insurance company who will come and visit the worker. The sick leave will then be granted for professional reasons. The distinction between occupational and non-occupational causes of an illness or accident is an important one, not only for determining the body responsible for managing the benefit, but also for determining the amount of that benefit.

Furthermore, the social security system provides protection in other situations or circumstances:

Workers may receive benefits in the event of incapacity or permanent disability if due to their physical or psychological state they are unable to carry out their work, or another type of work, in its entirety or partially (permanently, without the possibility of improvement or full recovery).
Unemployment benefit may be paid for the loss of work if certain criteria are met (previous contributions, being unemployed but actively seeking work etc.). In this case, the body responsible for the payment of unemployment benefit will be the State Public Employment Service.
Pensions are also paid on retirement once the retirement age has been reached and the minimum period of contributions requirement has been met.
Workers can also benefit from assistance from the Salary Guarantee Fund (FOGASA) in the event that their employer is unable to pay them due to insolvency.
Likewise, workers are entitled to use the health system which provides free healthcare for all citizens requiring medical assistance.
Moreover, workers can receive subsidised vocational training (at no additional cost to themselves) related to their profession and job role.

What taxes do I have to pay out of my salary?

Besides Social Security contributions, personal income tax (IRPF) must also be paid by workers. This is paid directly by the employer to the Treasury.

The tax rate varies, depending on salary level and whether or not the employee is resident in Spain for tax purposes.

Generally speaking, a natural person is considered a tax resident in Spain if they meet the following criteria:

Resides at least 183 days during a calendar year in Spanish territory. The main centre or base of their economic activities or interests is directly or indirectly located in Spain. The spouse (non-legally separated) and children (under 18, dependants of the natural person) lives in Spain on a habitual basis. After having been resident in Spain, the residence has moved to a country or territory classed as a tax haven (during the first year and for four years afterwards).

The minimum percentage is often 2% for temporary contracts and gradually increases to a maximum level of 47% for the highest salaries.

It is the employer's obligation to deduct personal income tax (IRPF) from the employee's salary and pay it to the Treasury. Workers and employers can calculate how much IRPF they will need to pay by entering the amount of the salary and the specific personal circumstances (please note that the figure obtained is for guidance purposes only).

In the case of being considered tax resident in Spain, the percentage of personal income tax withheld is set according to the personal characteristics of the worker (disabilities, number of children), type of contract (temporary or occasional) and, progressively, according to the worker's pay.

In the event that the worker is resident in Spain for tax purposes, but performs part of their work abroad for companies connected with the employer organisation, they will not have to pay income tax on that income (up to a limit of €60,100 per year) and provided that the other requirements established in the tax regulations are met.

Alternatively, if they work in Spain, but do not meet the conditions to be considered a tax resident in Spain, they will contribute to the system through the payment of non-resident income tax (IRNR). This is calculated solely on income earned in Spain. In this case, the tax to be paid is set at a fixed percentage of the worker’s salary, depending on if the worker is a resident of the European Union, Iceland or Norway (19%) or other countries (24%), and then the non-resident income tax return must be submitted for any tax to be paid.

A natural person will be classed as non-resident in Spain should they not fulfil the aforementioned criteria.

What will my working hours be?

The Workers’ Statute sets out that the maximum number of hours to work is 40 per week, on a yearly calculation. However, certain collective labour agreements in various sectors establish a lesser number of hours.

Ordinarily, no more than nine hours of effective working time per day is permitted, although a longer working day may be established by a collective labour agreement, as may an irregular distribution of working hours over the course of the week. In all cases, rest between working days must be respected (between the end of one working day and the beginning of the next, there must be at least 12 hours of rest, and during the weekend, a day and a half). Furthermore, any differences between the actual working day and the agreed or legal working day must be offset, in the case of overtime or of having worked fewer hours.

If the working day is uninterrupted and longer than six consecutive hours, workers are entitled to a paid rest break of no less than 15 minutes.

Minors under 18 years of age have a higher degree of protection with regard to both the working day (maximum 8 hours a day) and rest times (2 full days a week). Moreover, they are entitled to a paid rest break of no less than 30 minutes in the case of an uninterrupted working day of more than 4 hours and 30 minutes.

Workers must clock in and out of work to register their working hours, both at the beginning and the end of the working day, including lunch breaks where applicable. It is the company's obligation to provide the means for clocking in and out. In this way, checks can be made to ensure that the limits to the working hours and rest times are legally respected.

Hours worked over and above the legal or agreed maximum number of hours are considered overtime and must either be paid or compensated with time off in lieu, in line with the provisions of the applicable collective labour agreement. The minimum rate for overtime will be the same as that for standard working hours, but many agreements place a higher value on overtime than on standard hours (both in terms of granting time off in lieu, or through payment at a higher rate).

An employee may work a maximum of 80 hours of overtime per year, excluding those hours that are necessary to deal with emergencies (such as accidents or urgent repairs). For the purposes of calculating the maximum limit of 80 hours of overtime per year, those hours that have been duly compensated by time off in lieu within the four subsequent months, are not taken into account.

In order to ensure a work-life balance, and depending on the personal circumstances of the worker and the organisation of the company, workers may be entitled to request the adaptation and distribution of their working hours to their circumstances, including working from home, whenever this is possible, depending on the activity. This adaptation shall be negotiated between the employer and the worker and may not be unfairly refused by the employer.

In any event, when workers have dependants, family members with disabilities, or children under the age of 12, they shall be entitled to reduce their working hours, from a minimum of one eighth (1 hour) to a maximum of half of their working day (4 hours), with a proportional reduction in their pay. Moreover, in the case of parents or guardians responsible for the care of a minor who needs to be hospitalised or to undergo continuous treatment for serious illness, the law establishes the right to a reduction in working hours, from a minimum of half the working day, with the proportional reduction in salary.

You can consult the Labour Guide produced by the Ministry of Labour and Social Economy for more information on working hours, leave and holiday entitlement.

How many leave days and days off am I entitled to?

Employees are entitled to a minimum of 30 calendar days of paid leave per year. Pay in lieu of holiday is not permitted, except in the event of the termination of a contract.

Collective bargaining agreements often regulate holidays by establishing a minimum number of working days.

The period of leave shall be agreed between the employer and the worker with at least two months’ notice prior to the start date of the leave. If annual leave cannot be taken due to sick leave or under other specific circumstances (pregnancy, nursing leave, etc.), it can be taken after.

As a minimum, and with prior justification and having notified the employer in advance, workers have the right to be absent from work and are entitled to payment under the following circumstances:

Getting married (15 calendar days).
Death, accident or serious illness, hospitalisation or surgery without hospitalisation requiring a relative of up to the second degree of consanguinity or affinity to rest at home (2-5 calendar days).
Moving house (1 day).
Prenatal and childbirth preparation tests, adoption, etc. carried out within the working day (the necessary time required).
Training (20 hours per year).
Attending exams.
Workers' representation activities
Breastfeeding a child, one hour of absence from work per day, divisible into two parts, until the child is nine months old. It can be accumulated, and taken in whole days (15 days).
The necessary period of time to fulfil trade union or staff representation functions.
The time needed for the performance of an inexcusable public duty (such as voting in an election).

Collective labour agreements often extend this time off, and may even include other circumstances in which employees are entitled to paid leave.

What happens if I decide to leave my job or am dismissed?

Should a worker wish to leave their job, they should check what the minimum notice period is as established in the applicable collective labour agreement for their professional category. The minimum is 15 days. If the notice period is not respected, the company may deduct the proportional part of the days not worked during the notice period from the final salary payment, which is known as the settlement. However, during the probationary period established in the applicable collective labour agreement or in the employment contract, the employee may terminate the contract without the need to give notice.

If it is the employer's decision to terminate the contract, it is important to be aware that the employer cannot dismiss you without cause, but must prove the existence of legal grounds for your dismissal. The employer may terminate an employee’s contract as a consequence of a disciplinary hearing, in the case of serious or ongoing misconduct by the employee; they may also terminate the contract if there are objective reasons that justify the redundancy of the job role, or there are economic factors affecting the company.

As a general rule, the company must comply with the agreed notice period, and where applicable with the specific procedure established by law. However, the employer may also terminate the contract during the probationary period without the need to give any reason or to give a notice period.

Should a worker not agree with the reason for dismissal, it should be contested within a maximum of 20 working days (not including public holidays or weekends) from the effective date of the dismissal.

Firstly, the dismissal must be challenged by filing a conciliation form with the Conciliation Service of the corresponding Territorial Services to try to reach an agreement with the company, and if this is not possible, by proceeding to file a lawsuit with the competent employment tribunal.

It is important to be aware that Spanish law provides a high degree of protection for employees in the event of dismissal. This is why the company must provide a full explanation of the reasons for dismissal, and prove that they are justifiable in law. In the event of failure to do so, the courts may consider the dismissal to be unfair, entitling the worker to receive the compensation corresponding to unfair dismissal (33 days' salary per year of service), or to opt for reinstatement in their job role. , In the event that the dismissal is caused by the violation of a fundamental right or discrimination (racism, gender inequality, special protection of certain groups, retaliation against the exercise of labour rights, etc.), the dismissal may be deemed void by the courts, and the worker shall have the right to be reinstated to their job, and to receive the wages lost since the dismissal.

If the worker is dismissed for objective reasons, they will be entitled to the payment of the corresponding compensation, at the rate of 20 days' salary for each year of service.

Severance pay is calculated depending on the cause of dismissal, the employee's length of service and their salary.

When a temporary contract comes to an end, either the company or the employee may decide not to renew the contractual relationship. Temporary contracts also give employees the right to receive legal compensation at the end of their contract (with the exception of interim or training contracts), which in this case is 12 days' pay for each year worked.

As long as the contract is terminated for reasons beyond the employee’s control, if they do not have any other employment, they will be legally classed as unemployed. This may entitle them to receive unemployment benefit, or, if applicable, another form of subsidy, provided that they meet the statutory legal requirements (in the case of unemployment, benefit, they must have been working and paying contributions for at least one year). Unemployment benefits should be applied for within 15 days following the termination of a contract.

In any event, the termination of a work contract does not imply any loss of entitlement to medical care, a right which extends to all residents in Catalonia.

Who looks out for my interests as a worker if I have problems?

Workers are entitled to choose their representatives to look out for and defend their interests and rights against employers.

The number of workers’ representatives in each company varies depending on the number of employees. There can be one representative as a minimum, or a committee with various representatives, known as the works council. However, you should be aware that it is not mandatory for all companies to have employee representatives. Workers’ representatives or ‘works councils’ are often the first point of contact and assistance for workers in the event of a conflict with their employer.

In addition to the workers' representatives at your company, if available, you can call on trade unions representing the sector, operating either in the autonomous region in question or at state level, for assistance. They can be contacted if you have any queries regarding your employment rights.

Another agency available to help you if you believe that your company may be violating your employment rights is the Labour and Social Security Inspectorate, where you can file a complaint about any breach of labour or social security regulations that your company may be committing.

Have you got any queries regarding your employment rights? Do you want advice on the legal framework that protects your rights, and about the channels available to you for defending those rights? Contact with Labour Rights Defence Points by Barcelona Activa, a free municipal service.