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Spain's Interprofessional Minimum Wage (SMI) increases to €1,221 gross per month in 14 payments, effective January 1, 2026. The 3.1% increase affects approximately 2.5 million workers across all sectors. Daily rates rise to €40.70 for general workers and €57.82 for fixed-term contracts ≤120 days. Domestic workers' hourly rate increases to €9.55. The change applies retroactively to January 1, 2026, and workers at the SMI remain exempt from personal income tax.
Spain: Minimum wage rises to €1,221/month effective 1 January 2026
Spain's Interprofessional Minimum Wage (SMI) increases to €1,221 gross per month in 14 annual payments, effective 1 January 2026. The 3.1% increase affects approximately 2.5 million workers across all sectors and applies retroactively from the start of the year.
Who is affected
The increase applies to:
- All permanent employees in all sectors
- Workers on fixed-term contracts where services to the same employer do not exceed 120 days
- Domestic workers paid on an hourly basis
- Approximately 2.5 million workers nationwide
What's changing
| Category | Previous rate | New rate (effective 1 Jan 2026) | Change |
|---|---|---|---|
| Monthly (14 payments) | €1,184.30 | €1,221.00 | +€36.70 (+3.1%) |
| Daily rate (general workers) | €39.48 | €40.70 | +€1.22 |
| Daily rate (fixed-term ≤120 days) | €56.10 | €57.82 | +€1.72 |
| Hourly rate (domestic workers) | €9.27 | €9.55 | +€0.28 |
Workers at the SMI remain exempt from Personal Income Tax (IRPF). Salary supplements and bonuses are calculated separately and are not absorbed by the minimum wage increase. Only monetary remuneration counts toward the SMI; wages in kind cannot reduce the cash amount.
What NEO partners and clients should do
- Update payroll systems and wage tables to reflect the new rates effective 1 January 2026.
- Apply retroactive adjustments to all wages paid from 1 January 2026 onward; calculate any arrears owed to affected workers.
- Verify that salary supplements, bonuses, and other allowances are calculated separately and remain unaffected by the minimum wage increase.
- Confirm that domestic workers and fixed-term contract workers are classified correctly and paid at the applicable daily or hourly rate.
