How to hire an employee correctly and avoid employment mistakes

Hiring staff is an important step for any business. It also means taking on employment, pay and Seguridad Social (Spanish social security) obligations that must be handled correctly from day one.

A mistake in the type of contract, the working hours or the salary can end in contribution shortfalls, claims from the employee or penalties.

Choosing the right type of contract

Employment law presumes that a contract is permanent. Temporary contracts can only be used when there is a legal reason, mainly due to production needs or to replace an employee.

So it is not enough to say that the contract will be temporary because the business wants to “try out” the employee. There must be a real, specific and sufficiently justified reason.

Training contracts can also be used when their requirements are met, as well as fijo discontinuo contracts (permanent contracts for intermittent work) for seasonal or intermittent activities.

Check the collective agreement

Before preparing the contract, you need to identify the applicable convenio colectivo (collective agreement). The agreement may set:

• Minimum salary by job category.
• Maximum annual working hours.
• Probation period.
• Salary supplements.
• Holidays.
• Extra payments.
• Breaks and working hours.
• Notice periods and disciplinary rules.

The salary should not be calculated from weekly hours alone. You need to check the job category, the pay scales, the extra payments and any compulsory supplements.

Registration before starting work

The employee must be registered with the Seguridad Social before they actually start work. The business must also have a contribution account code and have the workplace, the occupation and the terms of the contract correctly identified.

The contract must be notified to the relevant bodies, and every month the business will need to prepare the payslip, the social security contributions and the IRPF (Spanish income tax) withholdings.

Working hours and time records

The working hours stated in the contract must match the hours actually worked. With a part-time contract, it is especially important to record the ordinary hours correctly and, where applicable, any additional hours.

The business must keep track of working time and keep the required records. Actual working hours should not systematically contradict what the contract says.

Occupational health and safety

Even a small business with a single employee must manage occupational risk prevention. Depending on the activity, it will be necessary to carry out a risk assessment, provide information and protective equipment, organise health and safety training and arrange health monitoring where required.

Don't improvise when hiring

Registering an employee is not just a matter of sending some details to the Seguridad Social. Before doing so, you need to review the collective agreement, the job category, the salary, the working hours, the type of contract and any available reductions in contributions.

At Lexum Asesores we handle contracts, registrations, payroll, social security contributions and employment obligations for companies and the self-employed.

Contact our employment advisers in Torrevieja before you take someone on and we will help you hire correctly from day one.