The global rise of remote workers and digital nomads, a trend accelerated by the Covid-19 pandemic, is shaping Spanish and European legislation.

In 2022, the Spanish government passed the so-called Startups Law, which allowed non-EU contract workers and freelancers to work remotely from Spain or set up a business, with more favourable tax conditions and a digital nomad visa specifically aimed at this kind of work.

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Now Spain and 17 other EU countries have reached an agreement which should make remote working for many Europeans and EU residents. 

On July 1st 2023 this group of European nations signed a framework agreement to facilitate regular remote working (or ‘teletrabajo‘ as it’s known in Spanish) within Europe whilst maintaining worker’s employment rights in their home countries and without burdening the social security systems of their host countries.

The agreement is featured Article 16(1) of the European Commission’s Regulation No. 883/2004 that deals with so-called ‘cross-border teleworking’ – that is to say, remote working from abroad. Details were also published in a Spanish Official State Gazette (BOE) on August 4th.

Adapting European labour legislation to the demands of remote working and digital nomads is, the text says, aimed at helping to “mitigate the effect of cross-border telework on social security legislation in the short term”, as well as to respond to the “complexities of satisfying such a diverse group of people [ie, all the different types of remote workers and digital nomads] in the short term”.

How the new remote working agreement work?

The multilateral agreement allows European residents to work from one country for a company located in another, all while maintaining the same employment rights and social security benefits as any other employee working in their home country.

Cross-border workers who work remotely from their EU country of residence for less than 50 percent of their contractual working hours are now able to choose to either remain under the social security regime of the country or residence, or that of their employer.

Previously, employees working in more than one Member State were subject to the social security regime of their country of residence if they worked there for 25 percent or more of their working hours.

Since July 1st, remote workers from one of the European countries that’s signed the agreement can move to Spain and work twice as long in the country without being subject to signing up la seguridad social (Spanish social security) and the bureaucracy that comes with it.

Say for example someone was working in Spain for a company based in Sweden. They could be able to enjoy the benefits of Spanish life (the weather, food, and pace of life) for half of the year whilst being subject to Swedish labour regulations, both in terms of salaries and social security benefits.

In other words, they would be like any other on-site worker back in Sweden, even if they were working from a balcony in Seville for less than 50 percent of the contractual hours.

This creates, in effect, a network of European digital nomads who can take up residence in any Member State and work in another with equal legal guarantees.

Which countries have signed up to the agreement?

According to the government BOE, so far eighteen countries have so far signed the framework agreement: Germany, Switzerland, Liechtenstein, the Czech Republic, Austria, the Netherlands, Slovakia, Belgium, Luxembourg, Finland, Norway, Portugal, Sweden, Poland, Croatia, Malta and France, in addition to Spain.

All 27 EU Member States have been invited to join the framework, as well as Iceland, Switzerland and even the United Kingdom.

Conditions

The agreement establishes a number of rules in order to be able to qualify.

These include that workers must be employed by a single company in one of the signatory states, that they don’t carry out work for another company (in their country of residence or another country) and that they are not self-employed.

The employee’s country of residence and the country where the company is based must both be part of the framework agreement.

As mentioned earlier, employees must work less than 50 percent of their contractual working hours in their country of residence to qualify.

There must also be an agreement between the employer and employee regarding the conditions of the remote work, which can last between one and three years and can potentially be extended, but is subject to national rules.

Cross-border workers still need to register as digital nomads in Spain in order to obtain a residence visa, but they will have employment and social security obligations with the country of the company they work for as long as long as they meet the other criteria.