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State incentives for training and employment

These incentives, which form part of the Government’s employment promotion policy, can signify important savings in labor costs and are divided into two types:

2.1 Training incentives

Law 30/2015, of September 9, 2015, regulating the Vocational Training for Employment System in the area of employment, together with Royal Decree Law 4/2015, of March 22, 2015, for the urgent reform of the Vocational Training for Employment System in the area of employment, established the system currently in force, with the following main goals: (I) to guarantee that workers, employees and unemployed workers can exercise their right to training; (II) to contribute effectively, through training, to the competitiveness of Spanish companies; (III) to increase participation in the collective negotiation of such matters; and (IV) to offer efficiency and transparency in public resources management.

The following measures are being used to reach these goals:

—  Training initiatives: broken down into the following four types:

  • Programmed training offered by employers to their workers: training initiatives that seek to respond to the real, immediate and specific training needs of employers and their workers, able to be carried out directly by employers or entrusted to an external agency accredited and/or registered at the appropriate registry.
  • Training offered by the relevant authorities to employed workers: aimed at fulfilling needs not covered by the programmed training offered by employers to their workers, these training initiatives are targeted at employed workers and are aimed at meeting a company’s productivity and competitiveness requirements, as well as fulfilling the need to adapt to changes at the workplace and to workers’ aspirations for professional promotion and personal development.
  • Training offered by the relevant authorities to unemployed workers: training initiatives for unemployed workers in line with individual training needs and with the needs of the production system, aimed at enabling workers to acquire the skills required by the job market, thus improving their employability.
  • Other vocational training initiatives (including, inter alia, individual leaves of absence for training and work-linked training): training initiatives aimed at favoring a worker’s professional and personal development, while responding to the needs of the labor market.

—  Economic training units: “economic unit” refers to the cost per participant and training hour potentially eligible for public funding. A unit’s amount will comprise both the direct and the indirect costs of the training activity, and costs incurred on the organization of programmed training can be financed at a rate of 10% at companies with more than 9 workers, 15% at companies with between 6 and 9 workers and up to 20% at companies with 5 or fewer workers.

The categories of the foregoing initiatives of vocational training for employment entered into force upon the approval of Royal Decree 694/2017, of July 3, 2017, implementing Law 30/2015 regulating the Vocational Training for Employment System.

With respect to programmed training offered by employers and individual leaves of absence for workers, employers are eligible for credit to finance training costs, which can take the form of reductions in employer social security contributions. Employers must also contribute their own resources to the financing of their workers’ training, at a rate of 5% (6 to 9 workers), 10% (10 to 49 workers), 20% (50 to 249 workers) or 40% (250 or more workers).

The amount of the reductions is set annually in the General State Budgets, according to the size of the company and the scope of the training carried out in the preceding year.

Specifically, the aforesaid credit is subdivided into two types, according to the type of training program (Table 1).

Table 1

FEATURES OF THE AID AMOUNT (ADDITIONAL PROVISION 109 LGPE 2017)*

Own training programs

Reductions in employer social security contributions so that the worker can take part in programs aimed at improving his qualifications.

The result of applying the following percentages, according to number of workers, to the amount paid in the preceding year as employer contributions to vocational training: 100% (between 6 and 9), 75% (between 10 and 49), 60% (between 50 and 249) and 50% (more than 250).

For companies with between 1 and 5 workers and for newly formed companies or companies opening new workplaces with new workers, reductions of €420 are established for the first case and of €65 for the second.

Individual leaves of absence for workers

Reductions in employer social security contributions for companies granting individual leaves of absence for training to their workers.

Equal to the salary costs of the leaves of absence granted, with certain limits established by Ministerial Order (TAS/2307/2007)**, according to size of company. As an example, for 2018 the limits will be between the amount equal to the costs of 200 hours, for companies with between 1 and 9 workers, and the amount equal to the costs of 800 hours, for companies with between 250 and 499 workers, increased by another 200 hours for each 500 workers more on the workforce.

During 2018, total credits granted under this section may not exceed 5% of the Public State Employment Service budget for the financing of reductions in employer social security contributions for vocational training for employment.

*  The amount of the 2018 reductions had not been stipulated by the date on which this Chapter was prepared, given that the 2018 General State Budgets Law had not yet been approved; accordingly, in principle, the amounts stipulated in the 2016 General State Budgets Law could be deemed to have been extended.

**  According to information obtained from the authorities, until new limits are approved by Ministerial Order, those that are currently in force will continue to be applied, in this case those of Ministerial Order (TAS/2307/2007).

On the other hand, training initiatives for unemployed workers, which include hiring commitments on the part of companies will entitle those companies to receive a subsidy granted on a competitive basis, in accordance with the regulatory specifications stipulated by the Ministry of Labor, Migration and Social Security in the related Order.

In this connection, pursuant to Transitional Provision 1.3 of Royal Decree 694/2017, of July 3, 2017, until the aforesaid regulatory specifications have been established, Order TAS/718/2008, of March 7, 2008 will continue to apply, subject in any case to the provisions of Royal Decree 694/2017 and of Law 30/2015.

Order TAS/718/2008 contemplates the following amounts* (Table 2).

Table 2

HOW GIVEN TRAINING LEVEL
BASIC SUPERIOR
Classroom** €9 €13***
Teletraining €7,5
Conventional distance training €5,5
Mixed The foregoing units will be applied having regard to the hours of classroom training and of conventional distance training or teletraining in the training initiative.
*  The amounts are included in Appendix I of Order TAS/718/2008, of March 7, 2008..

**  In the classroom training unit, the basic level refers to training in transversal or general subjects (those which respond to identified trends and favor the employability and inter-industry mobility of workers); while the superior level refers to training that includes subjects entailing specialization or enabling the worker to develop programming or management skills.

***  The public authorities may increase this amount by up to 50%, depending on the singular nature of certain training initiatives which, given their specialization and technical characteristics, require greater financing, without the cost being able to exceed 5% of the funds used to finance the offer of vocational training for employment.

Lastly, companies will be entitled to receive, as a direct concession, additional economic compensation for unpaid work experience carried out by unemployed workers in the context of training initiatives not related to professionality certificates.

2.2 Employment incentives

The Spanish Central Government offers an extensive catalog of aid, consisting mainly of reductions in social security contributions, aimed at promoting new stable or indefinite jobs (especially for unemployed persons included in groups such as women in general, young people aged 16-30, the long-term unemployed, unemployed persons over the age of 45 and persons with disabilities).

Furthermore, on an exceptional basis, certain reductions in social security contributions are instrumented for temporary contracts executed with workers with disabilities or with socially-excluded individuals, provided that in both cases they are unemployed and registered as job seekers at the Employment Office, as well as with persons who provide evidence of having been a victim of gender-based violence.

Where the indefinite-term or temporary contract is part-time, the incentive will be the result of applying to the incentives stipulated for each case, a percentage equal to the percentage of the working day stipulated in the contract, increased by 30%, the result of which may in no case exceed 100% of the stipulated incentive, except in connection with incentives for hiring persons with disabilities through special employment centers.

The catalog of aid, the basic parameters of which were just described above, is very extensive, as it varies according to the ample number of existing contracts and the specific features of each of them. Most of these incentives are set forth in Law 43/2006, on improved growth and employment, as well as in Law 3/2012, on urgent measures to reform the job market, which, among other objectives, are aimed at rationalizing the system of incentives for hiring under indefinite-term contracts, with a view to correcting some of the inefficiencies detected, in practice, in recent years.

More information on the aid and reductions envisaged for each type of contract may be found at the website of the State Public Employment Service (http://www.sepe.es)

In any case, the following Tables 3, 4, 5 and 6, is a summary of the main aid set forth in the aforesaid legislation, indicating the stipulated incentive percentages.

Table 3

a. INCENTIVES FOR HIRING UNDER INDEFINITE-TERM CONTRACTS TO SUPPORT ENTREPRENEURS* (ARTICLE 4 OF LAW 3/2012)

GROUPS DESCRIPTION ANNUAL AMOUNT (€) DURATION

Unemployed persons registered as job seekers at the Unemployment Office

Men and Women Women in occupations in which women are less represented 3 years

Young people
aged 16 -30**

Year 1: 1,000

Year 2: 1,100

Year 3: 1,200

Year 1: 1,100

Year 2: 1,200

Year 3: 1,300

Persons over 45

1,300 1,500

Unemployed persons registered as job seekers at the unemployment office of companies located in the Autonomous Community of the Canary Islands***

Young people
aged 16 -30**

Year 1: 90% of employer social security contribution

Year 2: 70%

Year 3: 40%

Year 1: 100%

Year 2: 80%

Year 3: 50%

Persons over 45 90% 100%
*  Only companies with fewer than 50 workers will be able to make use of the employment contract to support entrepreneurs regulated in this article

In order to apply these initiatives, the employer must maintain the worker hired in his job for at least 3 years after the commencement date of the employment relationship. It must also maintain the level of employment attained by the company with the indefinite-term contract to support entrepreneurs for at least one year after execution of the contract. In the event of a breach these obligations, the incentives must be returned.

Companies with fewer than 50 workers which hire unemployed persons who collect unemployment benefits using this contractual form may also take a tax credit for corporate income tax purposes equal to the lower of the following amounts: the value of the unemployment benefits still to be collected at the time of hiring or the amount of 12 months of the acknowledged unemployment benefit.

This tax credit will apply to contracts executed during the tax period until a workforce of 50 workers has been attained, provided that, during the 12 months preceding commencement of the employment relationship, the company’s total average workforce increases in connection with each worker by at least one unit with respect to that existing in the previous 12 months, and its application will be conditional on the worker hired having received unemployment benefits for at least 3 months prior to commencement of the employment relationship.

Indefinite-term employment contracts to support entrepreneurs may be executed until the unemployment rate in Spain has dropped below 15%.

**  Companies hiring their first worker aged under 30 using this contractual form may take a €3,000 tax credit for corporate income tax purposes.

***  The same requirements as those imposed for contracts executed in connection with companies located in the rest of Spain will apply, save for those shown on the table (article 5 bis of Law 3/2012).

Table 4

b. INCENTIVES FOR HIRING UNDER INDEFINITE-TERM CONTRACTS (LAWS 18/2014, 43/2006 AND 3/2012)

GROUPS DESCRIPTION ANNUAL AMOUNT (€) DURATION

Special situations

Socially-excluded workers (art. 2.5 Law 43/2006) 600
Socially-excluded workers who have finalized an employment contract with an employee insertion company during the preceding 12 months, and have not worked for another employer thereafter and are hired by an employer that is not an insertion company or special employment center (art. 2.5 Law 43/2005).

Year 1: 1,650

Year 2: 600

4 years
Victims of domestic violence (art. 2.4 Law 43/2006)*** 1,500
Victims of gender-based violence (art. 2.4 Law 43/2005)***
Victims of terrorism (art. 2.4 bis Law 43/2006)***
Victims of human trafficking (art. 2.4 ter of Law 43/2006)*** 2 years
Disabled people

In general (art. 2.2.1 Law 43/2006)

Men < 45 años Women < 45 años

Men and women aged over 45

Throughout the term of the contract

4,500 5,350 5,700
In case of severe disability (art. 2.2.2 Ley 43/2006) 5,100 5,950 6,300

Conversion to indefinite

Conversion of temporary contracts for job creation executed with persons with disabilities, or of training contracts executed with disabled workers into indefinite-term contracts (art. 2.2.1 Law 43/2006). 4,500 5,350 5,700

Throughout the term of the contract

5,100 5,950 6,300

Conversions of work-experience, handover and replacement due to retirement contracts into indefinite-term contracts (art. 7 Law 3/2012) ****

  Men Women 3 years
500 700
Conversion of vocational training and apprenticeship contracts, regardless of the date of execution, into indefinite-term contracts (art. 3.2 Law 3/2012) ***** 1,500 1,800
Conversion of contracts executed with socially-excluded workers into indefinite-term contracts (art. 2.6 Law 43/2006). 600 4 years
Conversion of contracts executed with Socially-excluded workers who have finalized an employment contract with an employee insertion company during the preceding 12 months, and have not worked for another employer thereafter and are hired by an employer that is not an insertion company or special employment center into indefinite-term contracts (art. 2.6 Law 43/2006). Year 1: 1.650
Year 2: 600
Conversion of contracts executed with victims of domestic violence into indefinite-term contracts (art. 2.6 Law 43/2006). 1,500
Conversion of contracts executed with victims of gender-based violence into indefinite-term contracts (art. 2.6 Law 43/2006). 1,500
Conversion of contracts executed with victims of terrorism into indefinite-term contracts (art. 2.6 Law 43/2006). 1,500
*  This reduction will apply in all cases of workers hired between the time Royal Decree-Law 8/2014, of July 4, 2014 came into force, i.e., October 17, 2014, and June 30, 2016.

** Young persons over the age of 25 and under the age of 30 who meet the requirements imposed under Law 18/2014 for eligibility for an action under the National Youth Guarantee System will be eligible for this reduction until their unemployment rate drops to below 20% according to the Survey of Active Population for the last quarter of the year.

*** Victims of gender-based and domestic violence, of terrorism and of human trafficking, do not have to meet the condition of being unemployed.

****  Potential beneficiaries of these reductions are employers with fewer than 50 employees at the time of hiring, including independent professionals and worker-owned enterprises or cooperatives joined by employees as working or business partners, provided that the latter have chosen a social security scheme for employees. In the case of workers hired under work-experience contracts and made available to user companies, said companies will be entitled, on the same terms, to identical reductions where, without a break in continuity, they arrange an indefinite-term employment contract with those workers.

*****  Starting on January 1, 2017, the social security contribution relief will consist of a reduction, where those hired are workers registered under the National Youth Guarantee System who meet the requirements imposed under article 105 of Law 18/2014, of October 15, 2014, approving urgent measures for growth, competitiveness and efficiency, said reduction being applied on the same terms as those of the reductions stipulated under article 3 of Law 3/2012 (article 3.5 Law 3/2012).

Table 5

c. INCENTIVES FOR HIRING UNDER TEMPORARY CONTRACTS (LAW 43/2006)

GROUPS DESCRIPTION ANNUAL AMOUNT (€)  DURATION
Persons with disabilities hired under temporary contracts to foster employment (art. 2.2.4 Law 43/2006). Men < 45 years Men > 45 years Women < 45 years Women > 45 years Throughout the term of the contract
In general 3,500 4,100 4,100 4,700
Severe disability 4,100 4,700 4,700 5,300
Socially-excluded persons (art. 2.5 Law 43/2006) 500
Victims of gender-based or domestic violence (art. 2.4 Law 43/2006) 600
Victims of terrorism (art. 2.4 bis Law 43/2006) 600
Victims of human trafficking (art. 2.4 ter Law 43/2006) 600

Table 6

d. INCENTIVES FOR HIRING UNDER INDEFINITE-TERM CONTRACTS, UNDER TEMPORARY CONTRACTS OR FOR CONVERSION INTO INDEFINITE-TERM CONTRACTS THROUGH SPECIAL EMPLOYMENT CENTERS (LAW 43/2006)

GROUPS ANNUAL AMOUNT DURATION
Unemployed persons with disabilities hired under temporary or indefinite-term contracts through special employment centers (art. 2.3 Law 43/2006). 100% of the employer’s social security contributions, including contributions for occupational accidents and sickness and joint collection contributions. Throughout the term of the contract.

The above does not preclude the reductions provided for in Order ESS/2518/2013 of December 26, 2013, regulating the training aspects of the contract for training and apprenticeship, whereby enterprises may finance the cost of training inherent in this type of contract through reductions in employer social security contributions. The maximum amount of these reductions will be the result of multiplying the economic module in question (face-to-face training: €8/hour; and distance training: €5/hour) by the number of hours equal to 25% of the working hours during the first year, and 15% of the working hours the second and third years.

It should be noted that the above-mentioned Law 18/2014 on urgent measures for growth, competitiveness and efficiency has entailed the modification of the above-mentioned Order ESS/2581/2013 on the training aspects of the contract for training and apprenticeship, increasing the maximum amounts of the reductions in employer social security contributions for cases where beneficiaries of the Youth Guarantee System are hired. In these cases, Order ESS/41/2015, of January 12, 2015, establishes that the above-mentioned multiple of 25%/15% will be increased to 50% of the working hours during the first year, and 25% of the working hours the second and third years.

Table 7

e. INCENTIVES FOR TRAINING AND APPRENTICESHIP CONTRACTS (ARTICLE 3 OF LAW 3/2012)

GROUPS DESCRIPTION ANNUAL AMOUNT DURATION

Unemployed persons registered as job seekers with the Employment Office

For contracts executed after July 8, 2012

Reduction in employer’s contribution to social security for common contingencies, including those relating to occupational accidents and illnesses, unemployment, wage guarantee fund and vocational training, equal to 100% in the case of employers with fewer than 250 employees; and 75% in the case of employers with 250 or more employees
(Article 3.1 Law 3/2012).

Throughout the term of the contract, including renewals

Regardless of the date on which they are executed

Reduction in employer’s social security contribution of EUR 1,500 per year (EUR 1,800 in the case of women) where training and apprenticeship contracts which have terminated are converted into indefinite-term contracts
(Article 3.2 Law 3/2012).
* The employer social security contribution relief stipulated for training and apprenticeship contracts will consist of a reduction, where those hired are workers registered under the National Youth Guarantee System who meet the requirements imposed under article 105 of Law 18/2014, of October 15, 2014, approving urgent measures for growth, competitiveness and efficiency, said reduction being applied on the same terms as those of the reductions stipulated under article 3 of Law 3/2012 (article 3.5 Law 3/2012)

Table 8

f. INCENTIVES FOR THE CONTRACTS PROVIDED FOR IN LAW 11/2013, OF JULY 26, 2013, ON MEASURES TO SUPPORT ENTREPRENEURS AND TO BOOST GROWTH AND CREATE JOBS

TYPE DESCRIPTION/GROUPS ANNUAL AMOUNT DURATION*
Training relationship (art. 9) Indefinite or temporary part-time hiring of young unemployed persons under the age of 30 registered with the employment office, beneficiaries of the National Youth Guarantee System, without employment experience and originating from other sectors of activity, combining employment and training** or having pursued such training in the 6 months preceding the execution of the contract. 100% reduction to employer social security contributions for common contingencies in the case of companies with fewer than 250 employees; and 75% in the case of companies with 250 employees or more. Maximum 12-month term, renewable for another 12 months provided that the worker continues to combine training and employment or has pursued the training in the 6 months prior the deadline for the 12 months preceding.
Microenterprises and self-employed workers *** (art. 10) Hiring on a permanent, full- or part-time basis, of young unemployed persons under the age of 30 and registered at the employment office. 100% reduction to employer social security contributions for common contingencies.*****

During the first year of the contract.

New young entrepreneurial projects (art. 11)

First hiring on a permanent basis (full or part time) on the part of independent contractors under the age of 30 and without salaried workers, of unemployed persons aged 45 or more registered uninterruptedly at the unemployment office, for 12 months in the 18 months preceding the hiring or who are beneficiaries of the occupational retraining program for persons who have used up their unemployment protection

100% reduction to employer social security contributions.

Maximum 12-month term after the hiring.

First young persons’ employment (art. 12)

Conversion of temporary contracts (up to a maximum of 6 months) of young unemployed persons under the age of 30 without employment experience or less than 3 months of experience into indefinite-term contracts. Reduction in employer social security contributions of €500 a year and €700 a year in the case of women.

During 3 years.

Work experience for first employment (art. 13)

Work experience contracts for young persons under the age of 30, even where 5 or more years have elapsed since completion of their studies.

Reduction to employer social security contributions of 50% or 75% where performing unpaid work experience at the company, with an additional reduction of 50% or 25%, respectively, for beneficiaries of the National Youth Guarantee System.

Throughout the term of the contract.

In the case of beneficiaries of the National Youth Guarantee System, the additional reduction will apply to all those hired through June 30, 2016.

*  The hiring incentives provided for under articles 9, 10, 11, 12 and 13 of Law 11/2013 will also apply where the contract is executed with youth under the age of 35 who have been recognized a degree of disability equal to or greater than 33%, provided that they also meet the other requirements imposed under the aforesaid articles (Additional Provision Nine Law 11/2013).

**  In accordance with the First Transitional Provision of the above mentioned Law 11/2013, the incentives set out in articles 9 to 13 will remain in force until the unemployment rate falls below the 15% mark.

***  Officially certified training or training promoted by the Public Employment or Training Services in languages or IT and communication of a minimum annual duration of 90 hours.

****  Excluding indefinite contracts in support of entrepreneurs,  indefinite contracts  of groups in special situations or with a disability and permanent contracts for intermittent work.

*****  In order to qualify for this measure, companies must meet the following requirements: a) have, when the contract is executed, a workforce of equal to or less than nine workers; b) not have had any previous employment relationship with the worker; c) not have adopted, during the six months preceding execution of the contract, unjustified contract termination measures; and d) not previously have executed another contract pursuant to article 10 of Law 11/2013 (article 10.1 Law 11/2013).

g. Incentives for indefinite-term employment and for independent professionals under Law 1/2015

Article 8 of Law 25/2015, of July 28, 2015, on the second chance mechanism, the reduction of financial burden and other social security measures, consolidated the incentive for indefinite-term employment and for independent professionals introduced by Royal Decree-Law 1/2015, of February 27, 2015, on the second chance mechanism, the reduction of financial burden and other social security measures, consisting of the possibility of reducing the employer social security contribution, in any of its forms, in cases of indefinite-term hiring. In order to be eligible for this incentive, companies must be up to date on the performance of their tax and social security obligations; they must not have terminated employment contracts in the preceding six months; and they must execute indefinite-term contracts, over a period of at least 36 months, which entail an increase in the level of employment.

The amount of the incentive can be up to €500, over 24 months, in cases of full-time hiring, and is reduced proportionally, according to the percentage of reduction in working time under each contract.

After the 24 months have elapsed, and during the following 12 months, companies with fewer than 10 employees at the time they execute the contract qualifying for this contribution relief, will be entitled to maintain the incentive, although only up to the first €250 of the contribution base, or the relevant amount reduced proportionally, in cases of part-time hiring.

It is also important to note that in the case of employees registered under the National Youth Guarantee System, this contribution relief will consist of a reduction, provided that the requirements stipulated under article 105 of Law 18/2014 (mainly, to be registered and included on the single demand list and, in any case, have evidenced not having worked or received education or training previously, during a specific period of time) are met.

Nonetheless, this incentive will not apply to certain employment relationships, such as special employment relationships (senior management, disabled persons, etc.) or to those that affect the spouse, ascendants, descendants and other persons related by consanguinity or affinity, or to the hiring of employees who had been hired by other group companies, among other cases.

Lastly, the application of this incentive will be incompatible with the application of any other social security contribution relief for the same contract, other than the relief for hiring beneficiaries of the National Youth Guarantee System or the economic aid to beneficiaries of the Employment Activation Program under indefinite-term contracts.

2.3 Local employment initiatives (no time limit)

In addition to the incentives to foster employment and to labor adjustments, aid and subsidies may also be granted for investment projects aimed at generating economic activity and stable employment in local and regional areas of Spain, subject to classification by the State Employment Public Service as investment and employment (I+E) projects or entities.

The specifications for the grant of this aid are established in the Order of July 15, 1999 of the forner Ministry of Labor, Migration and Social Security, which has remained in force in the context of the new Spanish Employment Strategy 2017-2020 approved by Royal Decree 1032/2017, of December 25, 2017.

In this Employment Strategy 2017-2020, special importance is given to the planning, assessment and monitoring of activation policies for employment based on results. Thus, it comprises a battery of projects and measures aimed at rationalizing the unemployment protection system and providing the National Employment System with key tools, infrastructures and data systems, with a view to modernizing it and enhancing its efficiency and effectiveness. These measures include most notably the following:

  • Improvement of protection systems: reinforcement for orientation, training, requalification, intermediation and protection programs for long-term unemployed persons over 50 years of age; and for the integral orientation, training and direct support program for young people without professional qualifications.
  • Reinforcement of support systems and instruments, with a new frame of reference for public/private and public/public cooperation.

Also, under the 2017-2020 Strategy, the forner Ministry of Labor, Migration and Social Security has approved a Strategic Plan of subsidies for 2017-2019, as a public policy planning instrument.

The Strategic Plan provides for two regulated subsidy lines, essentially pursuant to the Ministerial Order of July 15, 1999, referred to above, i.e., (I) subsidy line 1.7: “Employment Agents and Local Development (EALD)” and (II) subsidy line 1.27: “Enterprise (Axle 5 of the structural objectives of the 2017-2020 Employment Strategy)”.

For a project to be classed as “I+E” and, accordingly, to be financed as a local employment initiative, it must meet the following requirements:

  • A local Corporation must support the business project by contributing economic and/or material resources, such as infrastructures or services assisting it in the start-up and management of the business.
  • Projects must provide for the hiring of workers or the recruitment of new partners in the case of projects involving cooperatives or labor companies.
  • Projects must provide for the incorporation of a new company with a maximum number of 25 employees at the time of incorporation.
  • Projects must relate to a newly formed enterprise.
  • Projects must provide for the production of products and/or services which relate to emerging economic activities or, in the case of traditional activities in the area, which cover needs not covered by the existing structure.
  • Projects must meet technical, economic and financial viability requirements.

Incentives available for projects deemed eligible are as follows:

  • A financial subsidy aimed at the reduction by up to three percentage points of interest rates on loans granted to the company in connection with its incorporation and establishment. The maximum amount of this subsidy will be €5,108 per indefinite-term job created.
  • A subsidy for the support of management activities (e.g. subsidies for the external contracting of market or technical research, reports, and/or training programs). This subsidy will only be available during the first year after the incorporation of the company and will cover 75% of the cost of the qualifying services up to a maximum of €12,020.
  • A subsidy for technical assistance for the hiring of highly-qualified technical experts, covering 50% of total labor costs (including employer social security contributions for a maximum period of one year). This is a one-time subsidy with a ceiling of €18,030.
  • A subsidy for each indefinite-term employment contract, amounting to €4,808 for each new worker hired under an indefinite-term full-time contract (or the related proportion of such overall amount in the case of indefinite-term part-time contracts).
  • A subsidy for cooperatives and labor companies amounting to €4,808 per unemployed working partner recruited on an indefinite-term basis. This subsidy is not compatible with those described in the two preceding points.

All the aforementioned subsidies may be increased by 10% where the main activity is related to certain areas, such as the protection and maintenance of natural areas, new information and communication technologies, waste management, mass transportation, the development of local culture and the care of children, the handicapped and the aged.

Applications for these incentives must be submitted to the respective Provincial Directorate of the Employment Public Service or the appropriate Autonomous Community body, which are the bodies in charge of the management of this aid, selecting projects and granting the related aid.

This aid and these subsidies are compatible with others granted by other government agencies or public or private entities, although the total amount of the subsidy, whether taken alone or together with aid or subsidies granted by other public authorities, private or public entities, may not exceed 80% of the cost of the subsidized activity.