Teleworking in Spain for EU Citizens and Companies

Tuesday, 2 de July de 2024

In a globalised and interconnected world, what was unthinkable for most companies a few years ago has become a tangible reality for many of them, and that is that a large number of employees want to telecommute from a country other than the one in which the company hiring them is located. Equally, there are many cases where, in the search for the best candidate, the need arises to recruit someone who is in another country and does not wish to leave.

In these circumstances, different possibilities are opening up to make teleworking possible. Specifically, the following are the main options available to citizens and companies in the European Union ("EU") to enable the former to telework from Spain, which in recent years has become one of the main recipients of this type of employees:

(i) Firstly, we would be dealing with a temporary posting, whereby the employee can provide services in Spain for an EU company for a maximum period of 24 months, maintaining the contributions in the country of origin, by virtue of the provisions of Community Regulations (EC) no. 883/04 and no. 987/09.

The procedure for carrying out this posting is very simple, as the company does not need to be registered or have an establishment in the country of destination, and must simply complete the A1 form prior to the posting of the employee, as well as inform the Social Security authorities of both countries of the posting.

As for the employee, he/she would have to apply for a Spanish NIE and the certificate of registration as an EU citizen, if he/she intends to extend his/her stay in Spanish territory for more than 3 months.

As mentioned above, during this period, the employee will remain affiliated to the social security system of his/her country of origin, and will continue to be subject to the legislation applicable to his/her employment contract.

However, it is important to note that, as established in Law 45/1999, of 29 November, on the posting of employees in the framework of the transnational provision of services, the employer company must guarantee the employee the following working conditions, which are laid down in Spanish legislation and in the Collective Bargaining Agreement that may be applicable:

  • Working hours
  • Minimum wage
  • Equal treatment and non-discrimination
  • Child labour
  • Prevention of occupational risks
  • Respect for the privacy and dignity of employees
  • Freedom of association and the right to strike and assemble

Although it is not the subject of this note, it should always be borne in mind that, regardless of the Social Security regime applicable, if the employee has spent more than 183 days during a calendar year in Spanish territory, he/she will be considered a Spanish resident for tax purposes and must pay his/her tax obligations in accordance with Spanish legislation.

Likewise, from the company's point of view, it should in any case be assessed whether the presence teleworkers in Spain could mean that the Spanish tax authorities consider the company to have a permanent establishment in Spain, which could result in tax obligations in Spain.

(i) In the case of a stay of more than 24 months, the employee must register with the Spanish Social Security, which requires the company to have some type of legal representation in Spain and, in addition, for a specific employment contract to be signed in our country. In order to do this, there are various legal possibilities, such as, for example:

  • Para aquellos supuestos en los que la empresa no esté interesada en implantar un establecimiento en territorio español, ni realizar otro tipo de operaciones, más allá de vincular a la persona o personas trabajadoras a la misma a efectos de Seguridad Social, se puede acudir a un mero registro de la empresa en España. Es decir, la empresa simplemente solicitará un NIF (Número de Identificación Fiscal) extranjero, cuya solicitud es mucho más sencilla que la constitución de otro tipo de entidades, y que no conlleva obligaciones fiscales, más allá del pago obligatorio de los seguros sociales.
  • En los casos en los que la empresa, además de tener uno o varios trabajadores prestando servicios desde España, estuviera también interesada en implantarse en España y llevar a cabo su actividad en el territorio español.

The choice of one or the other will depend on the needs and preferences of the company itself, which can choose between setting up a permanent establishment, a branch or a subsidiary.

In any of these cases (i.e. contracts for more than 24 months), the contractual relationship between the company and the employee will be governed by Spanish law and must comply with the minimum guarantees established by law in all areas, which can always be improved by companies.

It is important to emphasise that if a European company is interested in hiring a Spanish citizen to provide services from Spain, it will always be necessary for the company to be established in one way or another on Spanish territory, since in no case will there be a displacement, unless the Spanish citizen is resident and linked to the Social Security system of another European country.

As we can see, there are different alternatives to guarantee effective telework from Spain to other EU countries for those companies or European citizens who wish to do so, although it is necessary to carry out a detailed analysis of the needs and interests of the company and the figure that best suits them.

However, the obligations on the part of the company do not end with the actual posting of the employees or their recruitment in Spain, but it is necessary to ensure the monitoring and compliance with Spanish regulations, in order to avoid the negative effects that non-compliance with Spanish legislation may have on the company and its relationship with the employees.

In addition to the above, it is important to bear in mind that in the field of telework it is essential to comply with the provisions of Law 10/2021 of 9 July on telework, which makes the prevention of occupational risks and the right to digital disconnection even more important, for which good advice is essential.

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