The situation
A plan to hire one person each in three countries with no local entity
A German SaaS company has found a salesperson in Madrid, a support engineer in Porto and a data scientist in Brno. It has no entity in any of the three countries and does not want to set one up for one person each. The founders have heard of employers of record, foreign-employer registrations and freelancing, and want to know which is lawful where.
The CFO needs a note before the offers go out. For each country: can the German company employ directly, what registrations that takes, whether an employer of record is lawful or treated as labour leasing, and whether a salesperson working from home creates a taxable presence. The answers differ by role.
What the research has to settle
The rules behind the answer
- Local employment law applies regardless
- An employee who habitually works in Spain, Portugal or the Czech Republic keeps the protection of that country’s mandatory employment rules, whatever law the contract chooses.
- Direct employment from abroad is possible
- Under the EU social-security coordination rules, an employer without an establishment in the country must meet the employer’s obligations there as if it had one, and can agree that the employee pays the contributions on its behalf. National law sets the registrations.
- An employer of record may be labour leasing
- Where a local provider employs the person who works under the client’s direction, national law may treat the arrangement as temporary agency work, which can require a licence and brings its own rules. The research confirms how each country treats the model.
- A salesperson can create a taxable presence
- An employee who habitually concludes contracts, or plays the principal role leading to them, can create a permanent establishment for the employer, depending on the wording of the tax treaty. A home office can matter too, on the facts.
How it runs in azta
From the question to the document
The question, as you would type it
German GmbH with no entities abroad wants to hire a salesperson in Madrid, a support engineer in Porto and a data scientist in Brno. For each country, can we employ directly, what registrations are needed, is an employer of record lawful, and does the salesperson create a permanent establishment?
You start with
A plan to hire one person each in three countries with no local entity
- 01
Describe the roles
Give each country, the role, who directs the work and whether the person negotiates or signs contracts. azta searches the EU coordination rules and the national employment and tax law.
Cited research· Free - 02
Read the national provisions
Open the Spanish and Czech provisions on agency work and employer registration in the reader, in the original language.
Atlas statute reader - 03
Draft the options note
Ask for a table by country and option, with conditions and risks, and a short note on the salesperson. Edit it in Canvas.
Canvas · Ask azta· Pro - 04
Share it with the founders
Export the note to Word for the founders and the payroll provider.
Word export· Pro You send
A note comparing the employment set-up options in each country
What you get
A note comparing the employment set-up options in each country
Options note · draft
Hiring in Spain, Portugal and the Czech Republic without an entity
Direct employment. In all three countries we can employ directly by registering as an employer with the social-security institution, without setting up a company. Local employment law applies to each contract. Payroll needs a local provider, and the annex sets out who withholds wage tax in each country.
Employer of record. The annex sets out how each country treats a provider that employs the person while we direct the work, including whether a temporary-agency licence is needed. We should use a provider only where that position is confirmed.
The Madrid salesperson. If the role includes negotiating and concluding contracts for us, it may create a permanent establishment in Spain. We recommend limiting the role to lead generation and support, with contracts concluded in Germany, until the position is reviewed.
Outcomes on your numbers
What azta is worth on this task
Pro pays for itself after
13 minutes a month
At €130 an hour, that is all the time Pro (€27 a month) has to take off your desk to cover its price.
Example figures. Replace them with your own.
- Hours back a year
- 25
- Capacity at your rate
- €3,276
- More hiring set-up notes a quarter
- 0.8
- Return on Pro
- 10.1×
- Research
- Drafting
- Your review
A scenario you set, not a promise. The hours that come back go to another client, or deeper into this one.
Want these numbers on your team’s real workload?
Book a demoWhat stays with you
- The choice of set-up for each hire.
- Contracts and payroll, which need local providers.
- The design of the sales role.
Frequently asked questions
- Does azta cover Portugal?
- azta researches tax and legal questions across Europe, and the source register lists what it holds for each country. Check the register for the Portuguese collections before relying on that part of the answer.
- Can it compare employer-of-record providers?
- No. It researches the law on the model, not the providers. Choosing a provider stays with you.
- What about hiring freelancers instead?
- Ask separately. Whether a freelancer is really an employee is its own question, with its own case law in each country.
