How the EOR Process Works in Spain: The 5-Step Model

The process starts with an agreement between your business and the EOR. This is a commercial contract, not an employment contract. It sets out who you want to employ, their salary and role, the start date, and the monthly fee for the service.

This is also where you confirm the terms the employee will be given. Because the EOR will be the legal employer in Spain, it needs those terms to be clear and compliant from the outset, including salary structure, whether pay is split across 12 or 14 payments, holiday, and any benefits. A good EOR will flag anything that does not fit Spanish law before it is signed. If you want the fuller picture first, our guide to what an Employer of Record is explains the model in plain terms.

Next the EOR collects what it needs from the employee to register them and run payroll. This is usually the quickest part, and it is where most of the onboarding time sits.

The essentials are the person’s identification and tax number, a DNI for Spanish nationals or an NIE for foreign nationals, their social security number (NUSS), and bank details for payment. If the employee does not yet have a social security number, the EOR can arrange it as part of registering them with the Tesorería General de la Seguridad Social.

• DNI or NIE, the identification and tax number.
• Social security number (NUSS), or help obtaining one.
• Bank account details for salary payment in euro.
• Agreed terms: salary, role, start date, working hours and benefits.

With the details in, the EOR issues a compliant Spanish employment contract and has the employee sign it. In Spain the employer must register the employee with social security before they start, and register the contract itself with the SEPE, the public employment service, through its online system.

The contract has to respect the applicable collective agreement (convenio colectivo) for the sector and region, which can set minimum pay, hours, and other terms above the statutory floor. Getting the right convenio applied is one of the details that trips up companies trying to do this themselves, and it is a core part of what the EOR handles.

When the first pay date comes round, the EOR runs payroll and issues the payslip, the nómina. Two things come out of gross pay: IRPF, the personal income tax, which is withheld and paid to the Agencia Tributaria, and the employee’s share of social security. On top of gross pay, the employer pays its own social security contribution, which adds roughly 30% to the wage cost.

Most Spanish employees are paid across 14 payments a year, twelve monthly plus two extra payments (pagas extraordinarias), though pay can be prorated into 12 instead if the contract says so. The EOR sets this up correctly so the employee’s net pay and the reporting both line up.

If you want to understand these deductions in detail, our guide to how Spanish payroll works breaks down IRPF and social security in full.

After the first payroll, the process becomes a monthly rhythm. The EOR runs payroll, files IRPF and social security, tracks the statutory 30 calendar days of annual leave, applies public holidays, and manages any changes such as a pay rise, a new benefit, or a change of role.

You carry on managing the person day to day, setting their work and their objectives, exactly as you would with any team member. The employee has a local point of contact for payroll and HR questions, so most of the administration stays quietly in the background.

The split of responsibility is consistent across all five steps. You bring the hire and the working relationship; the EOR carries the legal and administrative side of being a Spanish employer.

When you are ready to see it applied to a real role, our EOR services in Spain page sets out exactly what is included, and the step-by-step hiring guide covers the employer registrations in more depth.