The Ministry of Labor and the CCOO and UGT unions reached an agreement last week to raise the Interprofessional Minimum Wage (SMI) for this year by 5%, which means a monthly gross salary of 1,134 euros in 14 payments (15,876 euros per year).
How much exactly does the minimum wage increase?
This increase in the minimum wage means 54 euros more per month in 14 payments, that is, a total of 756 euros per year.
These amounts are always gross, which means that IRPF deductions and Social Security contributions will have to be applied to them.
According to the Government, domestic workers who work by the hour will receive at least 8.87 euros per hour.
The Government's commitment is to establish by law during this legislature that the SMI must always be equivalent to 60% of the minimum wage.
When does the increase take effect?
The increase will be applied retroactively from January 1, 2024.
In other words, it is most likely that it will be reflected in the first payroll of the year, since its publication in the BOE will allow companies to have enough time to update the contracts in the remainder of the month.
How many people does it benefit?
The measure will improve the salaries of about 2.5 million workers throughout Spain and about 120,000 in the Canary Islands.
The groups that will benefit most from the measure are women, young people and immigrants. As for economic sectors, it will be especially noticeable among workers in the agricultural sector and employees of small companies.
Why didn't the employers' association join this time?
The business organizations CEOE and Cepyme did not join the agreement, arguing that their demand to index the SMI to public contracts and to establish bonuses for the agricultural and livestock sector was not met.
Both the Government and the unions were willing to sign a smaller increase, of 4%, if the employers had joined the pact.
Is it true that the minimum wage has risen more in Spain than in other EU countries?
Since 2018, the SMI has increased by 54% in Spain. According to Eurostat, this is the fourth largest increase in recent years among the countries of the European Union.
The EU country that increased the minimum wage the most in the last five years was Lithuania, where it rose by 110%. The second was Poland, which increased it by 69%, and the third place is occupied by the Czech Republic, where the increase was slightly higher than the Spanish one, 55%.
Despite the increases, none of these three countries exceeds the barrier of 1,000 euros per month.
How many EU countries have a higher minimum wage than in Spain?
Only six countries in the Union have a higher minimum wage than Spain. These are Luxembourg, Germany, the Netherlands, Belgium, Ireland and France.
All the others have a lower minimum wage or simply do not exist in their legal system, as is the case of Denmark, Italy, Austria, Finland and Sweden.
