Penalties in Spain for employing foreign workers without authorisation
Ley Orgánica 4/2000 fines 10,001 to 100,000 euros for each unauthorised foreign worker in Spain and allows closure of the premises for up to five years.
Hiring a foreign national without first obtaining the residence and work authorisation is a very serious offence under article 54.1.d) of Ley Orgánica 4/2000, and one offence is committed for each worker employed. The fine runs from 10,001 to 100,000 euros under article 55.1.c).
Proceedings start with a report from the Inspección de Trabajo y Seguridad Social. The one offence per person rule is what turns an isolated irregularity into a balance sheet problem. Six unauthorised workers are not one file: they are six.
Who writes the report and who imposes the fine
Article 55.2 separates the two functions. The penalty procedure is opened by a report from the labour inspectorate, following the sanctioning procedure for social order offences, and the penalty is imposed by the Subdelegado del Gobierno, or by the Delegado del Gobierno in single province autonomous communities. Where an autonomous community holds powers over initial work authorisations, the penalty is imposed by the authority it designates.
The grading is not unbounded discretion. Article 55.3 requires proportionality, weighing the degree of culpability, the harm caused or the risk created by the offence, and its significance. Article 55.4 adds that the offender's financial capacity is to be given particular weight, which explains why two companies with identical facts receive different amounts.
The consequences that are not the fine
| Situation | Provision | Consequence |
|---|---|---|
| Hiring without prior authorisation | Articles 54.1.d) and 55.1.c) | 10,001 to 100,000 euros, one offence per worker |
| Same offence, ancillary measure | Article 55.6 | Closure of the establishment or premises for six months to five years |
| Subcontracting with knowledge | Article 55.7 | Joint liability of the main contractor and the intermediate subcontractors |
| Failure to register a worker whose authorisation was applied for | Articles 53.2.a) and 55.1.b) | 501 to 10,000 euros, plus the duty to meet the travel costs |
| Status of the worker concerned | Article 36.5 | The contract is not invalidated as to the worker's rights, with no unemployment benefit |
Article 55.7 is the one that surprises construction, logistics and facility services firms. Where the sanctioned company is a subcontractor, the main contractor and every intermediate subcontractor who knew that it was employing foreign nationals without authorisation are jointly liable for the financial penalties and for the other resulting liabilities towards the public administrations and towards the worker. The way out is in the same provision: those who observed the due diligence defined in performing their contractual obligations are not liable. That diligence is documented before the site opens, not when the report arrives.
Article 36.5 closes off the usual argument. The absence of authorisation does not invalidate the employment contract as regards the worker's rights, nor does it bar benefits arising from international worker protection conventions, without prejudice to the employer's liabilities, Social Security included. The company pays the contributions for the period worked either way.
The serious offence committed by accident
Article 53.2.a) classes as a serious offence the failure to register with the relevant Social Security scheme a foreign worker whose authorisation the employer had applied for, or the failure to register the contract on the terms on which the application was based, where the employer knows that the worker is lawfully able to start. The fine is 501 to 10,000 euros and the employer is also required to meet the travel costs.
That is the classic failure inside a well run file. The authorisation is granted in March, the visa is issued in April, the worker lands in May, and the payroll department applies the three month window in article 77.8 of the Reglamento on the assumption that it has all summer. In a seasonal authorisation that window does not exist: article 103.6 requires registration within three days of entry into Spain. Three days against three months, same company, same month, and a serious offence for having read the wrong instrument. The difference between the two regimes is set out in the employer procedure for the initial authorisation.
The labour inspectorate does not only check authorisations. Article 109.2 of the Reglamento gives it express power to verify seasonal accommodation conditions, described in accommodation and the IPREM cap. The European framework these national penalties sit inside is set out in the Employer Sanctions Directive, and the order in which Werklist runs the checks is on our employers page.
The check that avoids all of the above takes two minutes and happens before the first shift, not after the first inspection visit.
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