Posting of employees to Spain
Free movement of workers is a fundamental principle established in art. 45 of the Treaty on the Functioning of the European Union.
Posting of employees, its requirements, rights and obligations of companies and employees are regulated in the Directive 96/71/EC of the European Parliament and of the Council of 16 December 1996 concerning the posting of workers in the framework of the provision of services, Directive that applies in all EU member states and, in general, in the rest of the member states of the European Economic Area.
This Directive is transposed in Spain by Law 45/1999, of 29 November, on the posting of workers in the framework of the transnational provision of services. Let’s see the main factors that have to be taken into account.
List of legal acts that apply during posting
The company only can post employees who have a regular employment relationship or whom agree to a work contract only for that posting.
The company must maintain the relationship during the entire posting period, being the company the only one that can rescind the contract and the one that must accredit the fulfilment of its obligations with respect to salary, Social Security, etc.
During posting, the company must have available in Spain, in physical or digital format, a series of documentation regarding the displaced workers (work contracts, salary receipts and payment vouchers, records schedules, and authorization to work for non-community displaced persons, among others). The Labour and Social Security Inspectorate (ITSS) is responsible for ensuring compliance with the obligations imposed on business owners that post their workers to Spain.
Obligations of the employer posting his employees (e.g. obligation of notification)
The employer that post workers to Spain in the framework of the transnational provision of services must notify the posting, prior to commencement and irrespective of its duration, to the labour authority of the Autonomous Community where the services are to be provided. If the services are to be provided in the Autonomous Cities of Ceuta and Melilla, the information on the posting must be addressed to the work and immigration departments of the respective Government Delegations. (art. 5 Law 45/1999, of 29 November).
Unless the company is a temporary employment company, there shall be no need to notify the posting if its duration is not longer than eight days.
This notification will be made by electronic means through the central electronic registry established for this purpose by the Ministry of Employment in agreement with Autonomous Communities. The notification on the posting shall contain the following details and information:
- Identification of the company that is posting the employee (including address and tax number).
- Personal and professional details of the posted employees.
- Identification of the company or companies (and, where applicable, place or places of work) where the posted employees will serve.
- Scheduled start date and expected duration of the posting.
- Determination of the services that the employee will develop in Spain.
- Identification and contact data of a natural or legal person with presence in Spain. This person will be designated by the company for the purpose of liaison with the competent Spanish authorities and for sending and receiving documents or notifications.
- Identification and contact data of a person who can act in Spain on behalf of the company providing services in the procedures for information and consultation of workers, and negotiation, which affect employees posted to Spain.
The employers that post their employees to Spain in the framework of the transnational provision of services must guarantee these employees, irrespective of the legislation applicable to the work contract, the terms and conditions of employment set out under Spanish labour legislation with regard to the issues listed hereunder.
For these purposes, the terms and conditions of employment set out under Spanish labour legislation shall be those contained in the legal or regulatory provisions of the State and those set out in the collective agreements and arbitration awards applicable in the place in question or in the sector or branch of activity concerned.
This is without prejudice to the application to posted employees of more favourable terms and conditions of employment resulting from the provisions set out in the legislation applicable to their work contract, in collective agreements or in individual work contracts.
For these purposes, the length of the posting shall be calculated on the basis of a reference period of one year from the beginning of the posting, including, where applicable, any previous periods for which the post has been filled by a posted employee.
Obligations of posted employees
The citizens of a Member State of the EU or of another State party to the Agreement on the European Economic Area that are going to reside in Spain for a period of more than three months, are obliged to personally apply their registration in the Foreigners Office of the province where they intend to stay or fix their residence (or, in its defect, in the corresponding Police Station) in the Central Registry of Foreigners. This request must be submitted within three months from the date of entry into Spain. The applicant will be immediately issued with a certificate of registration that will include the name, nationality and address of the registered person, their foreigner identity number, and the date of registration.
Posted employees who are not taxpayers of the Personal Income Tax in Spain (IRPF), but who will acquire this status as a result of their move to Spanish territory, will have to notify to the Tax Administration by presenting form 147.
In this form shall be recorded the date of entry into Spanish territory and the date of commencement of work, as well as the existence of objective data in that employment relationship that make it foreseeable that there will be a longer stay to 183 days in Spanish territory.
Information about the provisions referring to minimum wage
As said before, unless the regulation in the country of origin of the company is more advantageous for the employee, the company must ensure that its employee will receive minimal wage according to Spanish law.
Current minimum wage in Spain is stated in Royal Decree 1077/2017, of 29 December, setting de minimum wage for 2018. The minimum wage for 2018 is set at 28.23 euros/day or 858.55 euros/month, depending on whether the wage is set by days or by months. In the annual calculation, the minimum wage rate for 2018 shall not be less than 10,302.60 euros for workers with full legal working hours.
Without prejudice to the foregoing, under all circumstances the minimum wage set out in the collective agreements and arbitration awards applicable in the place in question or in the sector or branch of activity concerned for the professional group or professional category corresponding to the work performed by the posted worker shall be paid.
The minimum wage rate shall be understood as that which, in the annual calculation and without discounting taxes, the interim payments of these taxes and social security contributions payable by the employee, comprises the basic wage and supplements, the extraordinary bonuses and, where applicable, the payment corresponding to overtime and night-time work. Under no circumstances shall the minimum wage rate include any voluntary protective enhancements with regard to social security.
Working hours and rest period
Working hours and rest period are stated in Revised Text of the Workers’ Statute Act approved through Royal Legislative Decree 2/2015, of 23 October (hereinafter, Workers’ Statute).
Art. 34 Worker´s Statute states that the maximum duration of the ordinary working day is 40 hours per week of effective work on average in annual computation. The performed works which exceed the 40 hours per week limit are deemed as overtime work.
However, the number of ordinary hours of effective work may not exceed 9 hours per day, except that by collective agreement or by agreement between the company and the workers' representatives, another distribution of daily work time is established, respecting in any case the minimum rest period of 12 consecutive hours between any two working days.
If the duration of the daily working day exceeds 6 hours, a rest period of at least 15 minutes must be established, which counts as working time if this is established in the collective agreement or in the work contract.
Rest period during the week must be minimally a day and a half uninterrupted, cumulative for periods of up to fourteen days. As general rule, will include the afternoon of Saturday or, where appropriate, the morning of Monday and the full day of Sunday.
Health Insurance and cash benefits
In accordance with Regulation (EC) 883/2004 of the European Parliament, a person who pursues an activity as an employed person in a Member State on behalf of an employer which normally carries out its activities there and who is posted by that employer to another Member State to perform work on that employer's behalf shall continue to be subject to the legislation of the first Member State, provided that the anticipated duration of such work does not exceed 24 months and that he is not sent to replace another person.
At the end of 24 months, the host State must authorize it to continue in the Social Security System of origin, or else it must submit to the legislation of the State where it provides services.
Health care is received under the conditions established in the State of residence, as if the posted employee was a national of that Member State (includes full medical care).
As a general rule, cash sickness benefits are paid in accordance with the legislation of the country in which the employee is insured, regardless of the country in which the interested party resides or is located.
The amount and duration of benefits are completely dependent on State legislation in which you are insured. Usually, the competent institution of that State will directly pay the cash benefits.
Conditions on which the company can post the foreigners (non-EU citizens) legally employed in its country of origin to perform temporary work in Spain
In the event that posted employees are nationals of States that are not members of the European Union or the European Economic Area, they must be authorized to work in the country of origin, but they do not need to be provided with a new authorization to work in Spain.
Other information that may be of interest to companies posting employees
Representatives of workers posted to Spain, who hold such status pursuant to national legislation practices, may exercise administrative or judicial actions under the terms recognized for workers’ representatives in accordance with Spanish legislation.
Representatives of workers of user companies and companies that receive in Spain the services from the employees posted under the wardship of the provisions set out in this Law shall have the terms of reference with regard to these employees as acknowledged under Spanish legislation, irrespective of the place where the company providing the services is located.
There are additional obligations of companies that post employees to Spain to carry out work under a system of subcontracting in the construction sector:
- They shall provide substantiation of observing the requirements set out in 4.2 a) of Law 32/2006, of 18 October, by providing documentation that proves compliance with the obligations set out in the national rules that transpose articles 7 "Protective and preventive services" and 12 "Training of workers" of Council Directive 89/391/EEC, of 12 June 1989, on the introduction of measures to encourage improvements in the health and safety of workers at work.
- In the event of postings for longer than eight days, these must be registered with the Register of Accredited Companies (REA) of the labor authority in whose territory the services are to be provided in Spain.
Madrid, May 2018
Luis Bravo, Abogado
José Ignacio Cabeza, Abogado
Fernando Lozano, Abogado / Asesor Fiscal