The Council of Ministers approved on February 17 the update of the Minimum Interprofessional Wage (SMI) for 2026. The regulation was published in the Official State Gazette (BOE) on February 19, 2026, and has been in effect since February 20, 2026, with retroactive effect from January 1, 2026.
The new SMI is set at €1,221 gross per month in 14 payments, equivalent to €17,094 gross per year. This update represents a 3.1% increase compared to the previous year.
Evolution of the SMI in recent years
The minimum wage in Spain has seen significant growth since 2019, a year in which one of the most substantial increases of the last decades occurred. At that time, the SMI rose from €735.90 to €900 per month in 14 payments, representing a 22% increase.
Since then, annual updates have continued steadily, surpassing €1,100 per month in 2024. This progression reflects the objective of bringing the minimum wage to around 60% of the average wage, in line with the criteria established by European regulations on adequate minimum wages.
Which workers are affected by the SMI increase?
The SMI increase does not automatically apply to the entire workforce of a company, but only to those employees whose annual gross salary is less than €17,094 for full-time work at the time the update comes into effect.
This means that companies must review current salaries to determine if any employee falls below this threshold and, if so, adjust their wages to comply with the new legal minimum once the regulation has been officially published.
Impact of the new SMI on companies
The minimum wage update has a direct impact not only on employee remuneration but also on company labor costs.
For employees, the salary increase represents approximately €43.16 gross per month if extra payments are prorated (or €37 gross per month in 14 payments).
However, the cost for companies is higher, as the salary increase is also subject to employer Social Security contributions, which can range approximately between 30% and 39%, depending on factors such as:
- the type of contract
- the company’s economic activity
- the employee’s occupation
- any applicable bonuses or reductions.
As a result, the economic impact on the company is not limited to the gross salary increase alone but also includes the corresponding rise in Social Security contributions.
