Final Settlement for an Hourly Domestic Worker in Spain: What the Hourly Rate Covers
With the 2026 hourly minimum wage (€9.55) the hourly rate already includes extra pay and holidays, which is why the final settlement for an hourly worker is different. What is settled, when extra pay and holidays must be paid separately, severance by reason of termination and an example with 10 hours a week.
By Isabella Velletri, Founder of Maids & Co
Published on 6 min read
In short
Hourly workers are the most common arrangement and the one that raises the most questions when it ends: do I owe holiday? What about extra pay? Is there severance pay for four hours a week? The answer depends on one thing only: what the agreed hourly rate includes. This article explains it with the rules and with an example of 10 hours a week.
What the hourly rate includes
The Royal Decree on the minimum wage sets each year an hourly amount for domestic workers who work by the hour on a live-out basis. In 2026 it is €9.55 per hour actually worked (RD 126/2026, art. 4), and that amount includes the proportional part of the two extra pay instalments and of holiday. In other words: someone paid €9.55 an hour is receiving their extra pay and holiday every month within that rate. That is why no month of holiday is paid separately, although the worker still has the right to 30 calendar days of rest (RD 1620/2011 art. 9.7).
| How it was agreed | Outstanding hours | Extra pay | Untaken holiday | Severance pay |
|---|---|---|---|---|
| Hourly minimum wage (SMI) (€9.55) or a higher rate stated in writing as "including extra pay and holiday" | Yes | No (already included) | Not paid separately (already included); the rest is taken | Depends on the reason |
| Agreed hourly rate with no mention of extra pay or holiday | Yes | Yes: proportional part of the half-year | Yes: 30 × days / 365, minus days taken | Depends on the reason |
| Fixed monthly salary for a few hours a week (part-time contract) | Days of the month | Yes if paid in 14 instalments; no if prorated | Yes | Depends on the reason |
The contract should expressly state "hourly rate including the proportional part of extra pay and holiday". If it does not and the rate is above the SMI, the worker can argue that extra pay and holiday were not included, and the employer will have nothing in writing to rebut it. This is the point that turns the most hourly final settlements into disputes.
Severance pay, in proportion to what the worker earns
The rules are the same as for a full-time worker; what changes is the base. Take the actual annual wage (hours per year × hourly rate) and divide it by 365 to obtain the daily wage. With 10 hours a week at the hourly minimum wage (SMI), the rate already includes extra pay and holiday, so if the worker takes the 30 calendar days of holiday (RD 1620/2011 art. 9.7), the hours actually worked and paid come to around 477 a year: 477 hours × €9.55 = €4,555.35 a year, €379.61 a month on average and a daily wage of €12.48. For the calculation, always use the annual wage actually received.
| Reason | Rule | Calculation | Amount |
|---|---|---|---|
| Termination for justified cause | 12 days per year, capped at 6 monthly payments (RD 1620/2011 art. 11.2) | 24 days × €12.48 | €299.52 |
| Unfair dismissal | 33 days per year, capped at 24 monthly payments (Workers' Statute art. 56) | 66 days × €12.48 | €823.68 |
| End of a fixed-term contract | 12 days per year (Workers' Statute art. 49.1.c) | 24 days × €12.48 | €299.52 |
| Death of the employer | One month's wage (Workers' Statute art. 49.1.g) | €4,555.35 / 12 | €379.61 |
| 20-day notice period not given | Wages for the days of notice omitted (RD 1620/2011 art. 11.2) | 10 h/week × 20/7 weeks × €9.55 | €272.86 |
| Voluntary resignation by the employee | No severance pay (Workers' Statute art. 49.1.d) | — | €0 |
Yes, even at four hours a week there is severance pay if you are the one ending the contract: it will be small, but it exists, and without a written letter stating the cause the 12-day entitlement becomes 33 days. The only cases with no severance pay are when she leaves of her own accord or when the cause is a proven disciplinary dismissal.
Full example: 10 hours a week, justified cause
An employee who works 10 hours a week at €9.55 (extra pay and holiday included in writing), with two years' service. The employer moves to another city and ends the contract for justified cause with a letter, without observing the 20-day notice period. The last week worked, 10 hours, has not been paid.
| Item | Calculation | Amount |
|---|---|---|
| Outstanding hours | 10 h × €9.55 | €95.50 |
| Extra pay and holiday | Included in the hourly rate | €0 |
| Severance pay (12 days/year) | 24 × €12.48 | €299.52 |
| Notice period not observed | 10 h × 20/7 × €9.55 | €272.86 |
| Total | €667.88 |
The outstanding hours are subject to contributions. The employee's deduction is 6.40% of the contribution base for the band that corresponds to what she earns per month, not of those hours alone: with €379.61 a month, the band goes up to €510 and the base is €436, so that is €27.90 a month (Orden PJC/297/2026, art. 15). Severance pay for the termination is exempt from contributions up to the mandatory amount (LGSS art. 147.2.c). Compensation in lieu of the notice period, however, is not among the items excluded from the contribution base: it is subject to contributions and tax like any other wage. If the hourly rate did not include extra pay and holiday, you would need to add the proportional part of the half-yearly extra pay and the holiday days accrued and untaken, calculated on what she earns per month.
Deregistration from Social Security: also for a few hours
Since 2023 the employer has always been responsible for registering the domestic worker, paying contributions and deregistering her, even if she works fewer than 60 hours a month: the option for the worker herself to register disappeared with RD-ley 16/2022. When the contract ends, deregistration is notified through Import@ss within 6 calendar days (RD 643/2026, from 1 August 2026). If the employee works for several households, each employer submits their own deregistration. And she is entitled to unemployment benefit if she has 360 days of contributions in six years: every day registered counts, whatever the working hours.
Sources
- Real Decreto 126/2026, minimum wage (SMI) 2026, art. 4: €9.55/hour for hourly domestic work, with extra pay and holiday included (BOE-A-2026-3815).
- Real Decreto 1620/2011, special employment relationship for household service, arts. 8, 9.7 and 11 (BOE-A-2011-17975), as worded by Real Decreto-ley 16/2022 (BOE-A-2022-14680).
- Workers' Statute, arts. 49 and 56 (BOE-A-2015-11430).
- Real Decreto 643/2026, 6-calendar-day deadline for deregistration with Social Security (TGSS) (BOE-A-2026-16557).
- General Social Security Law (LGSS), arts. 266 to 270 (BOE-A-2015-11724); Orden PJC/297/2026, contribution bands and rates, art. 15 (BOE-A-2026-7296).
The final settlement calculator for hourly workers asks whether the hourly rate includes extra pay and holiday, calculates the outstanding hours and applies the severance pay for the reason for termination to what she actually earns, with a breakdown for the payslip. If she is the one leaving, use the voluntary resignation mode. You will find this and the other calculators in the tools for household employers.
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Frequently asked questions
- Is an hourly domestic worker entitled to a final settlement (finiquito)?
- Yes. When the contract ends, she is paid the outstanding hours worked and, if the hourly rate did not expressly include extra pay and holiday, the proportional part of both. If the employer ends the contract, the severance pay that corresponds to the reason is added.
- Does the hourly rate include extra pay and holiday?
- If the hourly minimum wage (SMI) of €9.55 in 2026 is being paid, yes: RD 126/2026 sets that amount with the proportional part of the extra pay and holiday already included. If a different rate was agreed, it includes extra pay and holiday only if the contract says so.
- How much is the severance pay for an hourly worker?
- The same rule as for full-time work, in proportion to what she earns: 12 days' wages per year if the employer terminates for justified cause, 33 if it is unfair dismissal, one month's pay if the employer dies. With 10 hours a week at the hourly minimum wage, 12 days come to €149.76 per year.
- Does an hourly worker have to be deregistered from Social Security?
- Yes, like any other worker: the employer is responsible for registration and deregistration even if she works fewer than 60 hours a month (RD-ley 16/2022), and deregistration must be reported within 6 calendar days (RD 643/2026).
- Can an hourly worker claim unemployment benefit?
- Yes, if she has 360 days of contributions in the last six years and the contract does not end at her own wish. Days registered count as contributed even if the working hours are few.
Unsure about a term?See the domestic employment glossary
