investingalicia - Legal conditions

Legal conditions

Legal structure of companies in Spain

Types of contract

Social Security

National Minimum Wage

Foreign workers

Legal structure of companies in Spain

Types of corporate entity.

TYPE OF ENTITY	NO. OF SHAREHOLDERS	CAPITAL	LIABILITY
Corporation	At least 1	At least €60,102	Limited to capital contributed
European Company	At least 1	No less than €120,000	Limited, in principle, to the capital subscribed
Limited Liability Company	At least 1	At least €3,006	Limited to capital contributed
New Business Limited Liability Company	Minimum 1 / Maximum 5 at the time of formation	Between €3,012 and €120,202	Limited to capital contributed

Types of contract

Employment contracts can be for an indefinite or fixed term. The different types of fixed term contracts appear in the table below:

TYPE	PURPOSE	DURATION
Contract for project work or services	Performance of independent work or services within the context of the company's business	Depending on the time taken to execute the project
Casual contract to cover demand for production	To cover market demand or backlogs of work or orders	A maximum of 6 months within a 12-month period (extendable up to a maximum of 12 months in an 18-month period)
Relief contract	Temporary substitution of workers	Until the substituted worker rejoins or the expiry of the established substitution period.
Work experience contract	Hiring of university graduates, or workers with higher or advanced vocational training qualifications	A minimum of 6 months (may be extended twice) and a maximum of 2 years
Vocational training contract	Acquisition of the theoretical and practical training necessary to do a specific job	A minimum of 6 months and a maximum of 2 years (may be extended up to 3 years under collective labour agreement)

Social Security

All employers, workers, self-employed workers, members of manufacturing cooperatives, domestic staff, military personnel, and officials who live and/or work in Spain, must register with, and are obliged to pay contributions to, the Spanish social security system. Social security contributions are paid between the employer and the worker. Social security contributions in 2010 are as shown below:

Total contributions	Employee %	Total %
Total contributions	6.35	36.25

These rates are applied to certain minimum and maximum contribution bases (depending on the worker's occupation category), with the minimum contribution base set at €738.90 and the maximum at €3,198.00 in 2010.

National minimum wage

The national minimum wage is set by the government every year. In 2010 the minimum wage is €633.3 per month or €8,866.20 per year.

Foreign workers

Spanish immigration legislation makes a distinction between foreigners subject to the European Community regime, and foreigners subject to general immigration rules.

Nationals of EU Member States

Nationals subject to the European Community regime, from other EU Member States, the European Economic Area or Switzerland, do not need to obtain an employee or self employed work authorisation, and have the same labour rights as Spanish citizens.

Nationals from non EU countries

Foreigners not qualifying for the European Community regime require authorisation to live and work in Spain, as well as a special work visa. Employers wishing to hire non EU nationals must obtain prior authorisation from the Ministry of Labor and Immigration.