Employment Due Diligence in Spain

Clear employment risk analysis for informed transactions

We advise buyers, investors and corporate groups on employment due diligence in transactions, investments and asset acquisitions in Spain.

Our work covers workforce liabilities, employment contracts, remuneration, collective agreements, litigation, employee representation, Social Security, compliance and transaction-related employment risks.

We provide a clear and well-grounded view of the target’s employment position to support valuation, negotiation and deal structuring.

Employment due diligence under Spanish law

Employment liabilities can materially affect the value, timing and structure of a transaction.

 

The target’s workforce, contractual framework, collective arrangements, remuneration practices, disputes, compliance history and potential transfer obligations must be assessed before completion.

 

We identify material risks, quantify exposure where possible and translate legal findings into practical recommendations for the transaction.

Core employment due diligence matters

We advise on:

  • Workforce structure and headcount
  • Employment and senior executive contracts
  • Fixed and variable remuneration
  • Bonus, commission and incentive plans
  • Collective bargaining agreements
  • Company agreements and workforce arrangements
  • Employee representatives and trade union matters
  • Working time and overtime exposure
  • Dismissals, settlements and restructuring history
  • Pending and threatened employment litigation
  • Harassment, discrimination and whistleblowing matters
  • Social Security compliance and contribution risks
  • Employee benefits and pension arrangements
  • Contractors, consultants and misclassification risks
  • Business transfers and employee transfer obligations
  • Change-of-control and transaction-related rights
  • Employment compliance and internal policies

Workforce and contractual review

The employment structure of the target must reflect the roles, responsibilities and actual working arrangements in place.

 

We review employment contracts, senior executive agreements, contractor relationships, amendments, policies and key workforce terms to identify inconsistencies, gaps and potential liabilities.

Remuneration, incentives and benefits

Remuneration arrangements may create significant financial exposure if they are unclear, discretionary in form but fixed in practice, or triggered by the transaction.

 

We assess salary structures, bonuses, commissions, equity incentives, benefits, retention arrangements, severance commitments and change-of-control provisions.

Collective agreements and employee representation

Collective bargaining arrangements can affect working conditions, restructuring options and post-closing integration.

 

We review applicable collective agreements, company-level arrangements, works council structures, trade union involvement, information and consultation obligations and ongoing negotiations.

Litigation and employment liabilities

Existing and potential disputes may affect both the purchase price and the allocation of risk between the parties.

 

We analyse pending claims, threatened proceedings, dismissal history, settlement patterns, internal complaints and other matters that may result in financial, operational or reputational exposure.

Business transfers and post-closing integration

Transactions may trigger employee transfer rules or require specific information and consultation processes.

 

We advise on transfer obligations, continuity of employment conditions, allocation of liabilities, harmonisation risks and the employment implications of post-acquisition integration.

Cross-border employment due diligence

Where a transaction involves several jurisdictions, the Spanish employment review must be coordinated with the wider deal process.

 

As founding members of L&E Global, Suárez de Vivero coordinates employment law advice with leading firms in more than 30 countries, supporting buyers and investors in cross-border and multi-jurisdictional transactions.

How we support the process

Scope

Transaction structure, target profile, workforce perimeter and key risk areas.

Review

Contracts, policies, collective arrangements, litigation, compliance and liabilities.

Analysis

Material findings, financial exposure, transaction impact and priority risks.

Recommendations

Deal protections, conditions precedent, indemnities, warranties and post-closing actions.

When to involve employment counsel

Employment counsel should be involved when the transaction scope and target workforce are first defined.

 

Early involvement is particularly important where the target has a large workforce, complex remuneration structures, collective representation, ongoing disputes, recent restructuring or operations across several jurisdictions.

Employment Due Diligence FAQs

What does employment due diligence cover?

It typically covers contracts, remuneration, collective agreements, litigation, employee representation, working time, Social Security, compliance, benefits and transaction-related employment liabilities.

It helps identify liabilities that may affect valuation, deal structure, contractual protections, post-closing integration and the buyer’s future employment risk.

Yes. Depending on the structure of the transaction, certain employment and Social Security liabilities may transfer or remain connected to the acquired business.

At the beginning of the due diligence process. Early advice helps define the review scope, identify material risks and address employment issues before signing or completion.

Corporate restructuring requires precision before action

We advise companies on the employment law strategy, negotiation, implementation and defence of restructuring processes in Spain.
Barcelona
Plaza Europa, 9-11, 15 D
Torre Inbisa
08908 Barcelona
Madrid
Príncipe de Vergara 62
1º Derecha
28006 Madrid