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01. Hiring Practices

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01. Hiring Practices

Requirement for Foreign Employees to Work

Foreign employees from outside the European community, including self-employed individuals, must obtain an administrative authorisation, or work permit, to work in Spain. The work permit may be requested at the Immigration Bureau.

Does a Foreign Employer need to Establish or Work through a Local Entity to Hire an Employee?

When a foreign employer wants to hire a local employee in Spain, it must take charge of all the obligations related to the employee, such as the social security contributions and the income taxes. There are essentially two ways that a foreign company can hire employees in Spain. First, there is a possibility of setting up a company (subsidiary or branch) in Spain and hiring employees through it. The set-up process consists of establishing a fixed base of business in Spain, to develop an activity, and grant a Public Deed before the Public Notary. Tax laws require a legal representative resident in Spain, as well as a Digital Certification, in order to work with the Spanish Tax Agency. The company in Spain will have several other obligations related to the following services:

  • accountancy;
  • corporate income tax;
  • books of commerce and minutes;
  • annual accounts;
  • payment of social contributions.

Second, in contrast to the first option and only when certain requisites are met, the foreign company may have a legal representative in Spain (representation office). The legal representative in Spain must be a Spanish resident (individual or company) and it will be responsible for ensuring compliance with taxes, and the social contribution system payments of the foreign company in Spain, as these cannot be carried out directly by the foreign legal entity. The legal representative will usually take care of the payroll and the tax payment of the employees. In order to have a legal representative, the foreign employer will need to give a power of attorney appointing someone as its legal representative, residing in Spain. This POA must be validated by a public notary or by the Spanish consulate in the foreign country, stating that the company is validly constituted in accordance with its applicable law, translated into Spanish by a sworn translator and with the Hague Apostille. Additionally, the obtainment of a Digital Certification will be compulsory.

Limitations on Background Checks

Information regarding criminal records is confidential and public disclosure is prohibited as it could violate data protection regulations. Moreover, there is a general prohibition forbidding discrimination against any employee, for any reason, either before or after being hired. This is specifically provided for in article 14 of the Spanish Constitution, article 4.2 of the Workers’ Statute and article 73.2 of the General Penitentiary Law. In addition, access to the Central Registry of Convicts will only be allowed for certain state agencies, judges and courts, as well as the judicial police, when there is such a requirement. Therefore, the employer cannot obtain such data unless the candidates or the employees provide the data voluntarily. The courts have understood that the request for and use of this information are contrary to the legal provisions, considering that these practices represent a restriction on the access to the labour market. This is so, because in most cases the information provided is related to past events that are entirely unrelated to the job being offered, so the company’s request could be disproportionate for the intended purpose. Consequently, for Spanish Courts, the request for background checks during the selection process and the exclusion of a candidate due to the information obtained from them, could be discriminatory.

As an exception to the general prohibition mentioned above, there are certain sectors whereby there exists a legal obligation that entitles the employer to request and proceed with background checks. Among these sectors, we find the Public Administration, the state/local police, the army, managing members of financial institutions, insurance agents, professionals who work with minors and casinos.

Restrictions on Application/Interview Questions

By a series of strict regulations and case law on the prohibition of any type of discrimination as well as a prohibition, as a general rule, on requesting candidates to submit personal data that is not directly related to the needs of the job they are opting for. Especially in the selection process, the general position prohibits requests for personal information such as racial or ethnic origin, sexual orientation, health information, religious beliefs, persuasions or political views. Personal information along such lines of inquiry can only be requested when the need to know of such convictions is objectively and reasonably related to the nature of the job. Moreover, such personal data may only be collected when appropriate, in a relevant and non-excessive manner, and only as it relates in scope to the specific, explicit and legitimate purposes for which the information was obtained.

Another question is whether there is a legitimate need that would allow for an employer or HR representative to investigate a candidate’s profile on social networks, in order to discover additional information about the candidate. This is a matter that has not been regulated in Spain and therefore a candidate participating in a job interview could find himself in a “vulnerable” position of which the employer could take advantage of.

However, in principle, it is indeed legitimate for the employer to use such information as long as it is public, unrestricted and available to anyone. There are no general guidelines that can be used to guarantee that the fundamental rights of the candidate will in no way be breached when extracting information from social networks.

The employer is allowed to ask any question necessary, provided that it is reasonable and objective, and pertains to the job being offered. For example, requests for a candidate’s minimum height and age could be necessary and objective for a flight attendant position.

Any questions

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