The Spanish government announced on Wednesday an agreement with the main labor unions CC OO and UGT to raise the minimum wage (SMI, for its acronym in Spanish) by 35 euros, up to 1,000 euros per month in 14 payments a year.
Labour Minister Yolanda Diaz led the negotiations, but in the end she was not able to include the main employer organizations CEOE and Cepyme in the agreement. These organizations complain that the rise comes at a time when Spain has not yet come out of the Covid-19 crisis, with many companies still in difficulties that threaten recovery.
Therefore, the second increase in the minimum wage in Spain in less than half a year will be approved by the government by means of a real decree and without the consensus of all the social agents.
The measure is expected to come into force immediately and to be effective from 1 January, 2022. The government had raised the minimum wage to 965 euros in 14 payments on 1 September 2021.
These two recent increases are two milestones in the government plan to raise the SMI to 60% of the average Spanish salary at the end of the legislative term, in 2023.
Most benefited jobs
The Ministry of Labor headed by Yolanda Diaz estimates that this new increase in the minimum wage will benefit some 1.5 million workers in Spain.
Mainly, it will benefit those workers whose remuneration is not linked to a collective agreement, but rather is calculated based on the amount of the minimum wage.
This is the case, for example, of domestic workers. But the increase of 35 euros per month will also benefit thousands of people who work in the hospitality and restaurant sector, in retail trade and in agriculture, according to experts.
With this new increase, the minimum wage in Spain (calculated homogeneously, that is, at 12 payments) is already the seventh highest in the ranking of European Union member states. Of course, it must be taken into account that countries such as Austria, Denmark, Finland or Italy do not have a minimum wage set by law.
