How to calculate your final settlement (finiquito) in Spain, with an example
The final settlement (finiquito) is the payment of everything your employer owes you when the employment relationship ends, whatever the reason: dismissal, resignation, end of contract or failing the probation period. You are always entitled to it.
What the settlement includes
- Salary for the days worked in the last month that you have not yet been paid.
- Accrued but untaken holidays. By law you accrue 30 calendar days a year, that is, 2.5 days per month worked.
- The proportional part of extra payments, if you are paid in 14 instalments and they are not spread monthly.
- Other pending items: overtime, commissions or allowances.
Severance pay (indemnización) is not part of the settlement. It is only paid in some cases (dismissal or end of a temporary contract). We explain it in our guide to severance pay.
Example calculation
Ana earns €1,800 gross a month in 14 payments and leaves the company on 15 October. She already received the summer extra payment in July, and this year she has taken 8 days of holiday.
- Days worked in October: €1,800 / 30 × 15 = €900.
- Untaken holidays: from January to mid-October she has accrued about 23.8 days (9.5 months × 2.5). She has 15.8 days left: 15.8 × €60 per day = €948.
- Christmas extra payment: it accrues from January to December and Ana has worked 9.5 months: €1,800 × 9.5 / 12 = €1,425.
Gross settlement: €900 + €948 + €1,425 = €3,273. Social Security and IRPF withholding are deducted from this amount, as with a normal payslip.
Tips before signing
- Check every item and ask for a written breakdown.
- If you do not agree, sign adding “no conforme” (not in agreement). That way you can claim later.
- You can ask for a workers' representative to be present.
- If you are dismissed, you have 20 working days to challenge the dismissal.