Minimum Wage in Spain (SMI)

What Is the SMI?

The Salario Mínimo Interprofesional (SMI) is Spain’s national minimum wage — the legally mandated floor below which no employer may pay any worker. It is established annually through Royal Decree, following mandatory consultation with the most representative trade unions (CCOO and UGT) and employer confederations (CEOE and CEPYME).

The SMI applies to all workers in Spain, whether employed on permanent or temporary contracts, full-time or part-time, in any sector, and regardless of their professional category — with the caveat that specific sectors may have higher minimum wages established by their convenio colectivo, which then prevails.

SMI Rates

Spain’s SMI has increased substantially since 2018, when the government committed to raising it to 60% of the average wage (as recommended by the European Social Charter). Historical evolution:

The SMI is expressed in 14 payments per year (12 monthly + 2 extraordinary payments), which is the legally required minimum structure under the Estatuto de los Trabajadores. Employers who prorate extraordinary payments into 12 monthly payments must ensure the annual total still meets or exceeds the SMI.

How the SMI Works in Practice

Daily and Hourly Equivalents

The SMI is also expressed as:

• Daily: approximately EUR 37.80/day (2024)
• Hourly: calculated proportionally for part-time and domestic workers

SMI and Collective Agreements

The SMI establishes an absolute floor. If the applicable convenio colectivo sets higher minimum wages for any professional category, those higher figures apply. Since the 2021 labour reform, collective agreements cannot set wages below the SMI — even if an older agreement predating SMI increases specifies lower amounts, the SMI automatically supersedes them.

This creates a compliance challenge when SMI increases outpace collective agreement renegotiation cycles: employer associations and unions may be mid-negotiation when a new SMI decree takes effect. In these cases, the SMI applies immediately.

Part-Time Workers

For part-time workers, the SMI is applied proportionally based on the number of hours worked. A worker on 50% of full-time hours is entitled to a minimum of 50% of the SMI.

Domestic Workers

Domestic employees (empleados del hogar) are subject to the same SMI. Their Social Security regime was reformed in 2022 to bring them into the general scheme (RGSS), eliminating the historic exemption from unemployment benefit contributions. Since 2023, domestic workers also access unemployment benefit.

Live-in Domestic Workers

Workers who live with their employer may have up to 30% of their salary paid in kind (accommodation and board), but the remaining 70% must be paid in cash and must be at least 70% of the SMI.

SMI and Social Security Contribution Bases

The SMI also functions as the minimum Social Security contribution base for most workers. A worker’s contribution base cannot be less than the SMI amount for their working time, even if the parties agree to a lower salary (which is illegal). This means:

• Social Security contributions cannot be reduced by paying below the SMI
• Any salary supplement paid separately (e.g., expense reimbursements, exempt allowances) that is genuinely non-salary in nature does not count toward the SMI comparison — but the pure salary component must meet the SMI floor

Exempt Items Not Counted Toward the SMI

Certain payments are not included in the SMI comparison:

• Travel and transport allowances
• Overnight subsistence and meal allowances (within exempt limits)
• Employer contributions to pension plans
• Other payments made to compensate actual expenses

The comparison is made on the basis of the base salary and general salary supplements, not the gross total on the payslip.

Monitoring and Enforcement

The Inspección de Trabajo y Seguridad Social (ITSS) actively monitors SMI compliance, particularly in sectors with historically low wages (agriculture, domestic work, cleaning services, hospitality). Penalties for paying below the SMI:

• Classification as a serious labour infraction
• Fines ranging from EUR 751 to EUR 7,500 per worker (higher for systemic violations)
• Back-payment of the difference, with 4-year statute of limitations

Workers may also claim the difference before the Social Court (Juzgado de lo Social).

Impact on Employers

The series of SMI increases since 2018 (a 61% increase from EUR 735 to EUR 1,184 between 2018 and 2025) has had significant direct and indirect effects on employers:

• Direct cost increase for workers at or near the minimum wage (approximately 1.5–2 million workers).
• Knock-on effect on wage structures: workers earning slightly above the old SMI may demand proportional increases to maintain differentials, particularly where collective agreements specify inter-category ratios.
• Social Security cost increase: Higher SMI = higher Social Security contribution bases for the affected workforce.
• Fixed-cost base: The SMI applies even in low-revenue months for permanent contracts; variable cost planning must account for this floor.

Frequently Asked Questions

Can an employer pay less than the SMI if the worker agrees? No. The SMI is a mandatory legal minimum that cannot be waived by agreement between the parties. Any contractual clause agreeing to a lower wage is null and void; the SMI applies automatically.

Does the SMI apply to young workers and apprentices? The SMI applies to all workers. Training contracts (formación en alternancia) have reduced minimum salaries (60%/75% of the category minimum), but these must still meet a floor that has been linked to the SMI by law since 2022 — specifically, the salary in a training contract cannot be below the proportional SMI for the hours worked.

If our collective agreement hasn’t been updated after a SMI increase, what applies? The SMI applies immediately upon entry into force of the Royal Decree setting the new rate. A collective agreement that specifies a lower rate is superseded by the SMI from that date, without waiting for renegotiation.

Is the SMI the same across all of Spain? Yes, the SMI is a national figure set by the central government. There are no regional variations, unlike in some federal countries. However, the cost of living differs significantly between Madrid/Barcelona and rural areas, and collective agreements in different regions may set substantially higher wages.

What is the relationship between the SMI and the IPREM? The IPREM (Indicador Público de Renta de Efectos Múltiples) is a separate reference figure used for public benefits, grants, and subsidy eligibility thresholds. Since 2004, the IPREM and SMI have been separate indicators. The SMI (EUR 1,134/month in 2024) is higher than the IPREM (EUR 600/month in 2024).