All across Europe the under-25 age group has been struggling to find employment over the past few years. In February 2014, the Spanish government stepped in to help Spain’s youth find jobs with an important initiative that encourages businesses to employ more 16 to 25-year-olds. It’s part of the Royal Decree Law 8/2014, which includes measures to increase economic growth plus competitiveness and efficiency in business.

The initiative is essentially a business bonus scheme that an employer, including someone who is self-employed (autonomo), applies for. The application requirements are fairly straightforward, although if you’re an employer who’d like to join the scheme and you’re unsure about how it works, please contact Perez Legal for detailed advice.

Your employee must be over 16 and under 25, and registered with the National Youth Guarantee Scheme. The age level rises to 30 years for any employee who has a disability assessed at equal to or over 33%.

Employers pay a reduced rate of Social Security on a permanent contract for six months. The reduced rate for young people applies to both full-time and part-time contracts, providing that the part-time work constitutes at least 50% of the full-time working day. You, the employer, receive a monthly bonus based on your business’s social security contributions for the young employee on contracts signed between the 5th July 2014 and 30th June 2016.

One important point to consider is that the bonus can only be claimed once for each worker and you cannot therefore hire the same worker a second time and claim the bonus again. However, you may claim the bonus for more than one employee at a time, with the only limitation on the bonus payment being that the Social Security contribution must be above zero.

The actual bonus sum you’re paid depends on your employee’s working day. For example, on a full-time contract the business receives a 300€ bonus. If the working hours are equivalent to 75% of the full-time day then the bonus is 250€ and it’s 150€ for a part-time day, as stated above.

We hope employers in the Marbella area take advantage of this bonus scheme and give our young people the boost they need. Perez Legal is here to advise business owners and we’re keen to help promote this important initiative. Contact us with your questions!