Increase of the SMI before 29N: who it would affect and what is needed to approve it

The Ministry of Labor gathers this Thursday the commission of experts to outline the increase of the minimum wage for 2027, with the intention of approving it before the 29N and after consulting with unions and employers.

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The Ministry of Labor and Social Economy has launched this Thursday, October 8, the procedures to approve a new increase in the minimum interprofessional wage (SMI) before the general elections on November 29. The second vice president of the Government, Yolanda Díaz, has summoned the advisory committee responsible for studying its update, with the aim of establishing the amounts that will apply in 2027.

The initiative comes after the Executive approved in February an increase of 3.1%, which set the SMI at 1,221 gross euros per month in 14 payments, equivalent to 17,094 euros annually. The new review aims to respond to the increase in prices and avoid a loss of purchasing power among workers with lower wages, although there is still no official proposal on the percentage of increase.

The electoral advance has led Labor to accelerate a procedure that usually takes place during the last months of the year. However, the call for elections does not guarantee that the increase will be approved before November 29, since the report from the experts, consultations with social agents, and the final approval from the Government still need to be completed.

Who would benefit from the increase

The update of the SMI would directly affect employees whose remuneration is below the new legal minimum, regardless of the sector in which they carry out their activity or the type of contract.

Among the included groups are agricultural, industrial, and service workers, temporarily hired individuals, and domestic workers, for whom the regulations also establish a minimum hourly wage when providing services externally.

In the case of part-time contracts, the amount is applied proportionally to the hours worked, while full-time workers must receive, at a minimum, the legally established annual remuneration.

However, the increase in the SMI does not necessarily imply an automatic increase in all salaries close to that amount. The current regulations allow for the application of compensation and absorption mechanisms for certain salary supplements when the total remuneration of the worker, calculated on an annual basis, already exceeds the minimum required, without prejudice to what is established in collective agreements.

How much could the minimum wage increase in 2027

The amount of the next update remains pending on the report that must be prepared by the Advisory Commission for the Analysis of the Minimum Interprofessional Wage, whose first meeting is scheduled for this Thursday under the presidency of Yolanda Díaz.

The experts must study the evolution of wages and prices before recommending a range of increase that serves as a reference for subsequent consultations with unions and business organizations.

For the moment, one of the main references comes from CCOO, whose general secretary, Unai Sordo, has argued that the minimum wage should increase by more than 5% in 2027, in light of the rising cost of living. This union position does not constitute a proposal approved by the Ministry nor does it necessarily anticipate the final decision of the Executive.

What steps are needed to approve the increase

This Thursday's meeting constitutes the first step of the procedure. Once the advisory commission has prepared its recommendations, the Ministry of Labor must address the update with the union and business organizations, although the legislation does not require reaching an agreement to establish the new amount.

Article 27 of the Workers' Statute assigns to the Government the competence to set the minimum wage annually, after consulting with the most representative union and business organizations, taking into account factors such as the consumer price index, productivity, and the evolution of labor's share in national income.

In the last six revisions, according to Europa Press, CEOE has not participated in the agreement to raise the minimum wage, which has not prevented the Government from approving the corresponding increases.

Once the consultations are completed, the Executive may approve the new amount through a royal decree, which must be published in the Official State Gazette. Unlike royal decree-laws, this regulation does not require parliamentary validation, so its approval does not depend on a vote in Congress or in the Permanent Deputation.

How the electoral advance influences

The call for elections on November 29 gives a political character to the processing, as the Ministry of Labor intends to have the update corresponding to 2027 approved before the elections are held.

The dissolution of the Cortes does not in itself prevent the Council of Ministers from approving a royal decree of these characteristics, given that the determination of the SMI corresponds to the Government and does not require a parliamentary vote.

The Government will maintain its powers until the celebration of the elections on November 29, when it will be in office until the investiture of a new president. From then on, its capacity for action will be more limited, although it will still be able to approve certain measures, including a review of the minimum wage, as long as it complies with the legal restrictions of that period.

The intention of the Ministry is to complete the procedure before November 29, but a specific date for its approval in the Council of Ministers has not yet been communicated. It has also not been determined whether the eventual increase will take effect from January 1, 2027, as happened with the review corresponding to 2026, whose retroactive application was expressly included in the royal decree published in February.

More key points, information and questions with FREN

AI-GENERATED CONTENT

What is the current status of the parliamentary process for the upcoming increase in the minimum wage (SMI) and what are the usual timelines for its approval?

As of October 8, 2026, there is not yet a legally pending "upcoming" increase of the SMI in parliamentary processing. The current increase is the one already approved for 2026, and the work that has now begun for 2027 is in a preparatory phase, not parliamentary.

1. Current situation of the SMI increase

For 2026, the Government has already completed the regulatory cycle:

  • The Council of Ministers agreed to raise the SMI by 3.1% to 1,221 euros per month in 14 payments (17,094 euros annually) and to make it retroactive from January 1, 2026.
    This was announced on February 17, 2026, by the Ministry of Labor and Social Economy.
  • The Royal Decree 126/2026, of February 18, which sets the SMI for 2026, was published in the BOE on February 19, 2026, consolidating those amounts for the period 1-1-2026 / 31-12-2026.

Regarding the next increase (for 2027), what exists today is:

  • Convocation and meeting of the Advisory Commission for the Analysis of the SMI, which meets on October 8, 2026, with the Minister of Labor to begin preparing the 2027 increase.
  • Political announcements that Labor wants to accelerate the agreement before the November 29, 2026 elections and maintain the goal that the SMI represents around 60% of the average salary.

But, according to available information, there is no record yet of:

  • any royal decree of SMI for 2027 approved by the Council of Ministers,
  • nor a specific royal decree-law on the SMI pending validation,
  • nor a bill registered in the Cortes to set a new SMI amount.

Therefore, strictly speaking, there is no open parliamentary processing regarding the next increase: the process is in the governmental and social dialogue phase.

2. How an SMI increase is normally approved

The SMI is set by the Government through an "ordinary" royal decree, under Article 27 of the Workers' Statute. This has two important consequences for your question:

  • That royal decree is not a royal decree-law, so it is not validated by Congress nor processed as a bill.
  • Under normal conditions, the increase does not go through a proper parliamentary process; the role of the Cortes is political (control and debate), but not decisive regarding the text of the royal decree.

The usual scheme each year is:

  1. Report from the expert committee on the SMI for the following year (usually in autumn of the previous year).
  2. Negotiation at the Social Dialogue Table (Government, unions, and employers), from which a Government–unions agreement usually emerges, with or without CEOE support.
  3. Approval by the Council of Ministers of the royal decree setting the new SMI for the entire year (from January 1 to December 31).
  4. Publication in the BOE a few days later; in recent years this has occurred between late January and February.
  5. The royal decree expressly sets that the amount applies with retroactive effect from January 1, so companies must regularize already paid payrolls.
3. What if a royal decree-law were used?

In principle, it is not necessary to resort to a royal decree-law to set the SMI. If exceptionally the Government chose that route (for reasons of "extraordinary and urgent necessity"):

  • The royal decree-law would come into force upon its publication in the BOE.
  • The Congress would have 30 days to debate it and decide whether to validate or repeal it in a single vote.
  • The Plenary could agree that it be processed afterward as a bill, opening an amendment phase and allowing modification of the content.

That would be the only scenario in which we could talk about a proper parliamentary process for the SMI increase. Today there is no record that the Government has chosen that formula for the next update.

4. Typical timelines in practice

Looking at what has happened in recent years:

  • Negotiation and political agreement usually close between December and February.
  • The Council of Ministers approves the royal decree usually in January or February.
  • The BOE publishes the regulation in the following days (for example, the 2026 SMI was published on February 19, 2026) and the increase applies with effect from January 1.

In summary: today the next SMI increase is in the phase of governmental preparation and social dialogue, without a formal parliamentary file open, and the usual practice is that the decision materializes again in a royal decree of the Council of Ministers with publication in the BOE at the beginning of the year and retroactive effects.

What scenarios do the Government, unions, and employers consider for the 2027 SMI amount? How would a semi-annual review of the SMI, as requested by some unions, affect companies and workers? Can you compare the evolution of the SMI in Spain with that of other EU countries in recent years?

What are the powers and attributions of the Second Vice President of the Government according to Spanish legislation?

In the Spanish legal system, the figure of the Second Vice President of the Government does not have a distinct "own statute," but is framed within the general regime of the Vice Presidencies of the Government and what, at any given time, is established by the royal decree on the Vice Presidencies and the structure of the Executive.

1. General constitutional framework

The Spanish Constitution, in its Article 98, defines very basically the composition of the Government: it is composed of the president, the vice presidents, if any, the ministers, and other members established by law. The Constitution:

  • Recognizes that there may be one or several vice presidencies, but does not fix how many nor what specific rank the second has compared to the first or third.
  • Refers to the law (and, in practice, to the Government's royal decrees) for determining their statute and functions.

That is, constitutionally the second vice president is simply one of the members of the Government, hierarchically below the president and immediately below the vice presidency with an earlier ordinal number.

2. Regulation in Law 50/1997, of the Government

Law 50/1997, of November 27, of the Government, develops Article 98 of the Constitution. In the key provision on vice presidencies (located in the block of articles regulating the position of the president, vice presidents, and ministers) it establishes two central ideas:

  • Discretionary nature: the existence of vice presidencies "when they exist" means their creation is a political decision of the president of the Government. There may or may not be a second vice president, depending on how the president configures the Government after appointment.
  • Functions by delegation: "the Vice President or Vice Presidents, when they exist, shall exercise the functions entrusted to them by the President". This is the legal core of their powers: they do not have a closed catalog in the law, but their power derives from the assignment made by the president.

Additionally, the law foresees that the vice president who assumes the leadership of a ministerial department also holds the status of minister. In that case, the second vice president accumulates:

  • The attributions of vice president (by presidential delegation).
  • The ordinary competences of the ministry of which they are head.
3. Royal Decree 830/2023 and regulations on Vice Presidencies

The current detail is specified in Royal Decree 830/2023, of November 20, on the Vice Presidencies of the Government, modified by Royal Decree 1231/2023, of December 29. From its articles it follows that:

  • For the Second Vice Presidency of the Government, the general rule is reiterated: "it corresponds [...] to exercise the functions entrusted to it by the President of the Government."
  • A specific attribution is added: the presidency of the Government Delegated Commission determined in the corresponding royal decree (that is, another specific norm will establish which delegated commission the second vice president chairs).
  • It is expressly clarified that the General Commission of Secretaries of State and Undersecretaries is not chaired by any of the vice presidencies, but by the holder of the Ministry of the Presidency, Justice, and Relations with the Cortes, in application of Law 50/1997.

The numbering "first," "second," or "third" does not by itself imply a different competential content in the law, but a political and protocol order of precedence, to which the specific functions assigned by the president by royal decree or delegation acts are then superimposed.

4. Types of competences of a second vice president

In light of this regulatory framework, the competences and attributions of a second vice president of the Government can be grouped as follows:

  • General vice presidential functions: all those that the president attributes, which may range from coordinating large areas of public policy (for example, economy, ecological transition, social policy, digitalization) to directing certain transversal governmental strategies.
  • Coordination functions and chairing collegiate bodies: in particular, chairing one or more Government Delegated Commissions assigned to them. These commissions are collegiate bodies that group several ministries to coordinate complex sectoral policies; chairing them places the second vice president at the center of such coordination.
  • Functions derived from the ministerial portfolio (if held): regulation, planning, and management of the corresponding department, with all the powers of a minister (direction of the ministry, regulatory power within its scope, proposal of normative projects, etc.).
  • Political representation functions: although the law does not detail it, in practice the second vice president may assume Government representation in institutional acts, dialogue tables, or sectoral negotiations, always according to the internal task distribution decided by the president.

In sum, according to Spanish legislation, the second vice president of the Government is a "presidential design" vice presidency: the Constitution and the Government Law provide a basic framework, and the real content of their competences is specified through royal decrees and presidential delegations, which may vary from one legislature to another.

What legal requirements must be met for the Government to approve an increase in the minimum interprofessional salary through a royal decree?

The annual increase of the minimum interprofessional salary (SMI) is practically articulated through a royal decree of the Government. For that increase to be legally valid, requirements of competence, procedure, and content must be met, mainly derived from the Workers' Statute and the Government Law.

1. Competence basis: who can raise the SMI and with what instrument

The key is in Article 27 of the Workers' Statute (consolidated text approved by Royal Legislative Decree 2/2015):

  • It expressly grants the Government the power to set, after consultation with social agents, the SMI each year.
  • It refers to "minimum interprofessional salary" for any activity, without distinction of sex or age, and with general effects.

This provision is developed by regulation through a royal decree approved by the Council of Ministers and published in the BOE. It is not necessary to resort to a royal decree-law: the regulation of the SMI falls within the regulatory power of the Executive and does not require, by itself, the concurrence of "extraordinary and urgent necessity" nor subsequent parliamentary validation associated with the decree-law.

2. Consultation with unions and employers: obligation to hear, not to agree

The same Article 27 requires the Government to consult before setting the amount:

  • It must address the most representative trade union organizations and employer associations.
  • The obligation is for effective consultation (dialogue, exchange of positions, possibility to make allegations), not agreement.

In practice, a social dialogue table is convened where the Ministry of Labor presents a proposed increase, listens to unions and employers, and, if possible, reaches a pact. But, legally, lack of consensus does not invalidate the royal decree, as long as the consultation process has been carried out and reasonably documented.

3. Material criteria the Government must consider

Article 27 also sets the legal criteria to be weighed when deciding the SMI figure:

  • Consumer price index (inflation).
  • National average productivity.
  • Increase in labor's share of national income.
  • General economic situation.

The royal decree is not obliged to reflect these criteria with numerical formulas, but it must motivate the increase with reference to them: price evolution, economic context, wage improvement objectives, etc. This motivation is relevant both for political control and, if necessary, for possible judicial review.

4. Normative procedure of the royal decree

Being a regulatory provision, the draft royal decree of the SMI must follow the general rules of Law 50/1997, of the Government on the elaboration of general provisions, with the modulations foreseen by the law itself:

  • Regulatory impact analysis report (economic, budgetary, gender impact, etc.).
  • Hearing and public information procedure, except in specific exempted cases: in recent years it has normally been subjected to a quick hearing on the ministry's portal.
  • Report from the Technical General Secretariat of the proposing department and, if applicable, other affected ministries (Finance, Social Security...).
  • When the royal decree has the character of an executive regulation issued in direct development of a law (as with the application of art. 27), it is usual – and in many cases mandatory – to request a report from the Council of State.
  • Approval by the Council of Ministers, where the text is formally approved.
  • Publication in the BOE with the full text, the SMI amount (usually daily, monthly, and annual calculation), and the effective date.

The royal decree may set that the increase has retroactive effects from January 1 of the corresponding year, something that has been repeatedly done; such limited retroactivity is admitted as long as it does not harm consolidated rights and is clearly established in the norm.

5. Relation with the General State Budgets

The setting of the SMI does not require it to be determined by the General State Budgets. The SMI is set by royal decree under the Workers' Statute, while other amounts (such as the IPREM) are usually set in the Budget law itself. Therefore:

  • It is not a requirement that there be a new Budget law to raise the SMI.
  • The budgetary impact on benefits, contracts, and public expenses must be assessed, an aspect reflected in the impact report.

In summary, to raise the SMI by royal decree the Government needs: express legal competence (art. 27 ET), prior consultation with unions and employers, consideration of the economic criteria set by law, complete regulatory processing according to the Government Law, approval by the Council of Ministers, and publication in the BOE. Neither a specific law nor binding social agreement is required, although politically they are usually sought.

Could you detail with recent examples how the Government has motivated the last SMI increases in the preambles of the royal decrees? What legal differences would there be if an SMI increase were approved by royal decree-law instead of royal decree? How does the SMI increase by royal decree affect collective agreements and contracts already signed in the private sector?

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Who must first prepare a report with recommendations on the increase of the minimum wage before its approval by the Government?

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What type of regulation does the Government use to approve the annual increase of the interprofessional minimum wage?

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