Annual Leave Laws in Spain and Italy: What Employers Need to Know

Spain and Italy are two of the most popular destinations for UK and international companies expanding into Southern Europe. Both countries have robust labour protections, strong union traditions, and leave laws that differ significantly from what UK employers are used to.

Getting annual leave wrong in either country can result in fines, back-pay obligations, and employment tribunal claims. This guide covers everything you need to know about leave entitlements in both countries, with a comparison table and practical tips for employers hiring across the Mediterranean.

Spain: Annual Leave Under the Estatuto de los Trabajadores

Spanish employment law is primarily governed by the Estatuto de los Trabajadores (Workers’ Statute), supplemented by sector-specific collective bargaining agreements (convenios colectivos) that often enhance the statutory minimums.

Minimum Annual Leave Entitlement

The statutory minimum is 30 calendar days of paid annual leave per year. This translates to approximately 22 working days once weekends are excluded.

Key points about Spanish annual leave:

• The 30 calendar days cannot be reduced by collective agreement or individual contract — it is an absolute minimum
• Leave is calculated on a calendar day basis, not working days. When an employee takes a week off, it counts as 7 calendar days, not 5
• Saturdays and Sundays within a leave period count towards the 30 days (except public holidays that fall within the leave period — these do not count)
• Employees cannot waive their right to annual leave or accept payment in lieu — except on termination of employment
• Leave that is not taken cannot be financially compensated except at termination

How Spanish Leave Is Typically Taken

Spanish work culture has a strong tradition around summer leave. While the law does not mandate specific timing, in practice:

• Most Spanish employees take a significant block of leave in August — often 2–3 weeks. Many small businesses close entirely during parts of August
• Some collective agreements require employers to establish a holiday calendar (calendario de vacaciones) at the start of the year
• The employee must be informed of their holiday dates at least 2 months in advance of the start date
• If there is a dispute between the employer and employee about timing, the Juzgado de lo Social (Labour Court) can decide — and its ruling is final and not subject to appeal

Pro-Rata Entitlement

Employees who join or leave during the year are entitled to the proportional part of their 30 calendar days.

Example: An employee who joins on 1 July is entitled to 30 × (184 ÷ 365) = approximately 15 calendar days for the remainder of the year.

On termination, any accrued but untaken leave must be paid out (finiquito — the final settlement).

Public Holidays in Spain

Spain has a complex public holiday system with three tiers:

1. National holidays: Up to 14 days designated by the central government (though typically 8–10 are fixed nationally)
2. Autonomous Community holidays: Each of Spain’s 17 autonomous communities can designate their own regional holidays
3. Local holidays: Each municipality can designate 2 local holidays

The total typically adds up to 14 public holidays per year for any given location, but the specific days vary by region and municipality. For example:

• Catalonia celebrates La Diada (11 September) and Sant Esteve (26 December)
• Madrid celebrates San Isidro (15 May) and Dos de Mayo (2 May)
• Andalusia celebrates Día de Andalucía (28 February)
• The Basque Country has its own set of regional holidays

This means two employees in the same company but different offices may have different public holiday calendars. Employers with multiple Spanish locations must track this carefully.

National Public Holidays (2026, Provisional)

Date	Holiday
1 January	Año Nuevo (New Year’s Day)
6 January	Epifanía del Señor (Epiphany)
2 April	Jueves Santo (Maundy Thursday — varies by region)
3 April	Viernes Santo (Good Friday)
1 May	Fiesta del Trabajo (Labour Day)
15 August	Asunción de la Virgen (Assumption)
12 October	Fiesta Nacional de España (National Day)
1 November	Todos los Santos (All Saints’ Day)
6 December	Día de la Constitución (Constitution Day)
8 December	Inmaculada Concepción (Immaculate Conception)
25 December	Navidad (Christmas Day)

Plus 2–3 additional regional and 2 local holidays depending on location.

Carry-Over Rules in Spain

Spanish law does not explicitly address carry-over in the same way as UK law. However, the practical position is:

• Leave should generally be taken within the calendar year (or the agreed leave year)
• Spanish courts have held that the right to take annual leave expires 18 months after the end of the year in which it accrued — aligning with the European Court of Justice ruling in KHS v Schulte
• If an employer prevented the employee from taking leave (through excessive workload or denied requests), the employee retains the right to take it
• Employers have an obligation to facilitate leave — simply ignoring untaken leave does not make it disappear

Sick Leave in Spain: Incapacidad Temporal (IT)

When a Spanish employee falls ill, the system of Incapacidad Temporal (temporary incapacity) applies:

• Days 1–3: No pay from either employer or social security for common illness (some collective agreements cover this gap)
• Days 4–15: The employer pays 60% of the regulatory base (base reguladora)
• Days 16–20: Social security pays 60% (via the employer, who is reimbursed)
• Day 21 onwards: Social security pays 75%
• For work-related illness or accidents: 75% from day 1

Maximum duration: 12 months, extendable by 6 months if recovery is expected. After that, the employee may be assessed for permanent incapacity.

Annual leave continues to accrue during sick leave. If an employee is on sick leave when their planned holiday period arrives, they can take their annual leave at a later date — even in the next calendar year.

Italy: Annual Leave Under D.Lgs. 66/2003

Italian employment law provides strong worker protections, and annual leave rules are detailed, with collective bargaining agreements (CCNL — Contratti Collettivi Nazionali di Lavoro) playing an even more significant role than in Spain.

Minimum Annual Leave Entitlement

Under Decreto Legislativo 66/2003 (implementing the EU Working Time Directive), the statutory minimum is 4 weeks (20 working days) of paid annual leave per year.

Key features of Italian annual leave:

• The employee cannot waive the right to annual leave
• The minimum 4 weeks cannot be replaced by payment in lieu except on termination
• At least 2 consecutive weeks must be taken within the year the leave accrues
• The remaining 2 weeks must be taken within 18 months of the end of the accrual year
• Leave is a constitutional right under Article 36 of the Italian Constitution

ROL: Riduzione Orario di Lavoro

Beyond the statutory 4 weeks, many Italian collective agreements provide additional time off called ROL (Riduzione Orario di Lavoro) — essentially extra hours of paid leave designed to reduce working time.

ROL varies significantly by sector and CCNL. For example:

• CCNL Commercio (retail/commerce): 32–72 hours of ROL per year depending on company size and employee tenure
• CCNL Metalmeccanico (metalworking/manufacturing): 72 hours of ROL per year for companies with 15+ employees
• CCNL Turismo (tourism): varies by role and level

ROL can often be taken in hourly increments, making it useful for short absences. Unused ROL is typically paid out — unlike statutory annual leave, which must be taken as time off.

How Italian Leave Is Typically Structured

In practice, most Italian employees receive more than the statutory 4 weeks. A typical package under a major CCNL might include:

• 20 days of statutory annual leave (ferie)
• 32–72 hours of ROL
• 8–12 days of ex-festività (former public holidays that were abolished but converted to paid leave days under certain collective agreements)
• 12 public holidays plus the local patron saint day

The total effective time off for many Italian employees is 30–35+ days per year.

The Mandatory 2 Consecutive Weeks

Italian law is explicit: at least 2 weeks of the 4-week statutory minimum must be taken consecutively within the calendar year. This reflects the Italian (and broader EU) belief that workers need an extended rest period for genuine recuperation.

Most Italian employees take this block in August — typically during the week of Ferragosto (15 August). Many businesses, particularly in manufacturing and retail, close entirely for 1–2 weeks in August (the chiusura estiva).

The 18-Month Deadline

The remaining 2 weeks of statutory leave (beyond the mandatory consecutive block) must be used within 18 months of the end of the year in which the entitlement accrued.

Example: For leave accruing in 2026, the remaining 2 weeks must be taken by 30 June 2028.

If the employer fails to ensure leave is taken within this period, they face penalties. The employer — not the employee — bears responsibility for ensuring leave is used.

Public Holidays in Italy

Italy has 12 national public holidays:

Date	Holiday
1 January	Capodanno (New Year’s Day)
6 January	Epifania (Epiphany)
Easter Monday	Lunedì dell’Angelo (varies)
25 April	Festa della Liberazione (Liberation Day)
1 May	Festa dei Lavoratori (Labour Day)
2 June	Festa della Repubblica (Republic Day)
15 August	Ferragosto (Assumption)
1 November	Tutti i Santi (All Saints’ Day)
8 December	Immacolata Concezione (Immaculate Conception)
25 December	Natale (Christmas Day)
26 December	Santo Stefano (St Stephen’s Day)
Variable	Festa del Santo Patrono (Patron Saint’s Day — varies by city)

The patron saint day is specific to each municipality. For example:

• Rome: 29 June (Saints Peter and Paul)
• Milan: 7 December (Saint Ambrose)
• Florence: 24 June (Saint John the Baptist)
• Naples: 19 September (Saint Januarius)

This adds a 13th public holiday that varies by location — similar to Spain’s local holidays.

TFR and Leave on Termination

When an Italian employee’s contract ends, the final settlement includes:

• TFR (Trattamento di Fine Rapporto): The end-of-service allowance, accruing at approximately one month’s salary per year of service. This is not leave-related but is part of every termination calculation.
• Payment for accrued but untaken leave (ferie non godute): The employee must be paid for any statutory leave not yet taken. This is subject to social security contributions.
• Payment for unused ROL and ex-festività: Typically paid out at the contractual rate.

The cost of untaken leave on termination can be substantial, particularly for long-serving employees who have accumulated unused ROL. This is a strong incentive for employers to ensure leave is taken regularly.

Sick Leave in Italy: The INPS System

Italian sick leave (malattia) works differently from Spanish IT:

• The first 3 days (periodo di carenza) are typically paid by the employer at 100% under most CCNLs
• From day 4: INPS pays 50% of average daily pay (days 4–20) and 66.67% (days 21–180)
• Most CCNLs require the employer to top up to 100% for a defined period
• Maximum duration: 180 days per year
• Medical certificates are sent electronically to INPS from day 1

A critical rule for employers: Italian employees on sick leave must be available for INPS home visits during specified reperibilità hours (10:00–12:00 and 17:00–19:00, including weekends and holidays). Failure to be available can result in loss of INPS benefits.

Spain vs Italy: Side-by-Side Comparison

Feature	Spain	Italy
Statutory minimum	30 calendar days (~22 working days)	4 weeks (20 working days)
Basis	Calendar days	Working days
Additional leave (collective agreements)	Varies by convenio colectivo	ROL (32–72 hours) + ex-festività
Public holidays	14 (national + regional + local)	12 national + 1 patron saint day
Mandatory consecutive block	Not legally required (but customary in August)	2 weeks minimum (mandatory)
Carry-over deadline	~18 months (case law)	18 months for non-consecutive portion
Payment in lieu	Only on termination	Only on termination (statutory leave)
Typical summer closure	August (partial or full)	Ferragosto week (1–2 weeks)
Sick leave system	Incapacidad Temporal (employer + INSS)	Malattia (employer + INPS)
Sick leave employer obligation	Days 4–15 at 60%	First 3 days (carenza) + CCNL top-up
End-of-service payment	Finiquito (accrued leave only)	TFR + accrued leave + unused ROL
Governing law	Estatuto de los Trabajadores	D.Lgs. 66/2003 + CCNL

Practical Tips for Employers Hiring in Spain and Italy

1. Identify the Applicable Collective Agreement

In both countries, collective bargaining agreements are at least as important as the statutory law. Before hiring, determine:

• Spain: Which convenio colectivo applies to your industry and region. The Ministry of Labour maintains a registry of all active agreements.
• Italy: Which CCNL applies. The most common are Commercio (commerce), Metalmeccanico (metalworking), and Terziario (services). The applicable CCNL determines leave entitlements, ROL, sick pay top-ups, and much more.

Getting the wrong collective agreement — or not applying one at all — is a common mistake that can result in significant back-pay claims.

2. Plan for August

Both Spanish and Italian employees expect to take substantial leave in August. If your business cannot close, plan well in advance:

• Establish a rotation system for coverage
• Set clear deadlines for August leave requests (ideally by April or May)
• Be aware that in Italy, the mandatory 2-week consecutive block often falls in August by custom

3. Track Calendar Days vs Working Days

Spain uses calendar days; Italy uses working days. Your leave tracking system must handle both correctly. Miscounting leads to either overpaying (giving too many days) or underpaying (giving too few — a legal risk).

4. Manage ROL Separately in Italy

ROL is not the same as annual leave and should be tracked as a separate balance. It can be taken in hourly increments, it has different carry-over rules, and unused ROL is typically paid out rather than forfeited.

5. Budget for TFR in Italy

TFR accrues continuously throughout the employment relationship at approximately one month’s salary per year. It is a significant cost that does not exist in Spanish or UK employment law. Factor it into your total cost of employment.

6. Handle Regional Public Holidays Correctly

Both countries have location-specific public holidays. An employee in Barcelona has different public holidays from one in Seville. An employee in Milan has a different patron saint day from one in Rome. Your leave system must account for this per-office or per-location variation.

7. Monitor Sick Leave Obligations

The sick leave systems in both countries are complex, involving employer obligations, social security reimbursements, and medical certification requirements. Ensure your HR team understands the specific obligations and timelines for each country.

8. Consider Using an Employer of Record (EOR) — or Don’t

Many UK companies hiring in Spain or Italy use an Employer of Record (EOR) service like Deel, Remote, or Papaya Global. EORs handle the legal employment relationship, including leave compliance. However, they add cost (typically £400–700/employee/month) and reduce your direct relationship with the employee.

If you have a legal entity in Spain or Italy, managing leave in-house with the right tools is more cost-effective. Either way, you need a system that tracks entitlements correctly.

How Leave Balance Simplifies Spanish and Italian Leave Management

Managing leave across Spain and Italy — with their different counting methods, collective agreements, regional public holidays, and ROL balances — is exactly the kind of complexity that breaks spreadsheets.

Leave Balance lets you configure country-specific policies that reflect the actual rules:

• Spain: Set 30 calendar days as the base entitlement, add the correct regional and local public holiday calendars, and track accrual from start date
• Italy: Set 20 working days plus ROL as separate balances, configure the 2-week consecutive block requirement, and add the correct public holidays including the local patron saint day
• Both: Track sick leave, accrual during absence, and carry-over deadlines automatically

Your Spanish and Italian employees can request leave through Slack or Teams in their normal workflow. Managers see a unified view across countries, and the system handles the underlying complexity.

At $10/month flat rate — regardless of how many employees you have in Spain, Italy, or anywhere else — you get compliant leave management without the per-head costs that make other tools expensive for growing international teams. Start your 14-day free trial today.