Editor’s note: This article was first published in June 2011. It describes Spanish rules of that time on combining part-time work with unemployment benefit. Spain’s unemployment protection has been reformed since, including a 2024 reform of the unemployment subsidy.
Few people know that even while collecting unemployment benefit (el paro), you can work legally. Clearly, someone who took on debts based on their salary may find that unemployment benefit isn’t enough to pay them off, so Spanish law allows people to work while still collecting benefit. We explain how below.
To qualify for this kind of “arrangement”, you need to find a job in which you are not hired full time. In other words, you can’t have a 40-hour-a-week contract, because it would be obvious that you didn’t need unemployment benefit.
So the calculation works like this:
With a part-time employment contract you can keep collecting unemployment benefit, although the amount is reduced in proportion to the hours you work. You are only paid for the percentage of hours that would be needed to make up a full working week. In other words, if you get a half-time job of 20 hours a week, you would be working 50% of the full schedule, so you would receive your salary from the job plus 50% of the benefit you were entitled to before.
Let’s say your benefit was 800 euros: now you would be paid 400, so the job you’ve found had better pay you more than 400 euros for those half days. Otherwise, you’re better off staying put until you find a full-time job.
Both companies and workers often take advantage of this “arrangement”. A common practice is to sign a contract for just 10 hours a week when the “employee” will actually work 20 or 30, and to pay them for the real hours, with the difference in undeclared cash. That way, if there’s an inspection, the company can always come up with some excuse, and the worker collects 75% of the benefit while earning more than their contract states. So in this case, even though it’s illegal, the deal works out very profitably for both the company and the worker.
Featured image: Miguillen, CC BY-SA 4.0, via Wikimedia Commons.
