Employer of Record in Spain: Save time and money employing

Spain keeps attracting foreign companies. Yours might be next, and that’s why you should consider partnering with an Employer of Record in Spain. It allows you to build a team faster, with less money and fewer compliance risks—while the Employer of Record (EOR) handles legal and payroll matters for you.

Gladly, you’re in the right place. Understand how it works, the difference between local and global EORs, and why, in some cases, it’s better than other expansion setups.

Employer of Record in Spain: What it is and how it works 

Think of an Employer of Record (EOR) as your partner in a new country. In short, that’s precisely what this setup allows: foreign businesses to hire abroad without owning local entities or handling tax and legal matters. 

An EOR in Spain is a third-party organization that takes on all the compliance responsibility for employing your team there. That means they handle all the complex administrative tasks, like payroll, taxes, and benefits, while you control your employees’ daily work.

In other words, you deal directly with your team in everything work-related—as if the EOR was a ghost.

The benefits? Many.

Speed, compliance, and cost savings. An EOR lets you hire in Spain in days, not months, bypassing the need to set up your legal entity. EORs like BRIDGE IN are experts in local labor laws, which reduces the risk of non-compliance and potential fines. 

Plus, by offloading HR and administrative burdens, you can focus on what matters: your core business activities. But don’t rush your decision. Choose your EOR wisely, as there are many to pick from.

Global vs. Local EOR in Spain: What's the difference?

When it comes to EORs, they’re mainly divided into 2 types:

• Local EORs focus on specific countries, offering deep, specialized knowledge of each market's regulations. They provide you with specific benefits for your teams based on each country’s regulations—while also assuming all legal and compliance risks.

• Global EORs operate worldwide, often using their legal entities or a network of local partners to hire on your behalf. They normally offer generalized services, without customizing to each country or worker. Also, you must accept to take on eventual risks, including in MSAs.

If you want to expand into multiple countries (even if not at once), go for a global EOR, as it offers the services you need—while ensuring operations remain legal and compliant regardless of the countries you choose.

However, if you’re focused on expanding into a specific country at a time, pick a local EOR. They’re more experienced in the region, know the talent pool, and have multiple partners ready to go once a new client arrives. That’s the perfect setup for testing new markets, hiring quickly, or building remote teams without the upfront costs and complexities of opening a company.

However, if you're planning long-term operations with a larger team (say, 10-15+ employees for over 2 years), establishing a local entity may be more cost-effective and give you full control over operations and brand presence.

Employer of Record or Foreign Employer? What’s the best setup?

When expanding into Spain, you’ll find different employment options, but not all of them suit you. Besides EORs, one of the most known models is the Foreign Employer (FE). A Foreign Employer in Spain doesn’t have a permanent establishment there, but still registers as a non-resident entity to employ workers legally.

Here’s a quick breakdown comparing EORs and FEs:

• Legal employer: With an EOR, the EOR is your team’s legal employer. With an FE, your company is the legal employer.

• Control: An EOR handles HR and compliance. An FE gives you full control over HR, payroll, and contracts.

• Compliance responsibility: The EOR takes on compliance risk. With an FE, your company is directly responsible for local labor and tax laws in each country you expand into.

• Costs: EORs have higher recurring per-employee fees, while FEs are often more cost-effective (only in the long run) once you complete the initial registration.

Still confused? Let us help you.

It’s best to choose an EOR for quick, effective market entry. However, the FE setup can be more strategic and cost-efficient for long-term growth with multiple hires.

Now, back to the EOR talk.

How to choose the best Employer of Record in Spain

The truth is there are so many to choose from. Picking the best EOR in Spain is critical. Here’s what you should evaluate:

• Spanish labor law expertise: Spain's labor laws are complex, from employment contracts to working hours and termination. So, your EOR must have deep knowledge of matters like this.

• Comprehensive services: Look for an EOR that offers more than just payroll. This includes robust support for onboarding, benefits administration, work permits, and ongoing HR guidance. EOR services differ from one entity to another, so don’t rush your decision.

• Transparent pricing: Ask for clear, upfront information on all fees (and we mean all of them), from setup to monthly charges, per-employee fees, and eventual add-ons.

• Proven experience: Check client testimonials, case studies, and industry reputation to ensure you’re making the right decision.

• Local support: An EOR in Spain must provide timely assistance to you and your employees, ensuring smooth operations in the local time zone and language.

Employer of Record in Spain: all your FAQs answered

You’ve reached the right section if you still have doubts about how EORs in Spain work, how much they charge, the average team salaries, and so on. That’s why we’ve gathered and answered the most common questions below.

What is the EOR Service in Spain?

An EOR in Spain must be as comprehensive as possible, covering the entire employee lifecycle. You should look for these core services:

• Employment contracts: Drafting compliant contracts in Spanish, detailing terms like working hours, wages, and termination rules.

• Payroll management: Accurate and timely salary payments, tax withholding, and social security contributions.

• Benefits administration: Providing statutory benefits (like healthcare and paid leave) and assisting with competitive perks.

• Onboarding and offboarding: Managing all necessary documentation for new hires and departures.

• HR and compliance support: Keeping you updated on changing labor laws and serving as a local HR contact.

• Work permits and visas: Ongoing support for foreign hires.

In short, an EOR handles the legal, administrative, and HR complexities, letting you focus on your team's performance and business goals.

How much does an Employer of Record cost in Spain?

EOR costs in Spain vary but typically involve a fixed monthly service fee per employee. At BRIDGE IN, we charge between €270 and €520 per employee, per month. 

What is the Beckham Law in Spain?

The Beckham Law in Spain is a tax incentive for professionals relocating to Spain. It allows them to pay a flat 24% tax rate on their Spanish-sourced income (up to €600.000 per year) for up to 6 consecutive tax years. A major benefit is that foreign-sourced income (like dividends or business income outside Spain) is generally exempt.

What is a good salary in Spain?

In 2024, the average gross salary in Spain was around €34,188 per year (approx. €2,442 per month). Ultimately, it depends on the area, education, role, industry, and experience level.

Navigating international employment can be complex, but with the right Employer of Record in Spain, it doesn't have to be. Whether you're testing new markets, building a remote team, or seeking a compliant alternative to setting up an entity, the EOR model offers flexibility and a clear path to success.

We know we can help you. Reach out when you need.