An estimated 200,000 workers in Catalonia are set to benefit from Spain’s recent minimum wage increase, according to a new report from the UGT de Catalunya trade union. This figure represents approximately 6% of all social security contributors in the region.

Your browser does not support the video tag.

The pay rise is the result of a mid-February agreement between Spain’s Ministry of Labour and Social Economy and the country’s main trade unions, the Unión General de Trabajadores (UGT) and the Workers’ Commissions (CC.OO.). A Royal Decree published in the Official State Gazette (BOE) formally established the national minimum wage (Salario Mínimo Interprofesional, or SMI), which has increased by 5%. This brings the new rate to €1,134 gross per month, paid over 14 instalments, for a total of €15,876 gross annually. The change is retroactive from 1 January 2024.

A “Collective Success” With Caveats

In a statement reported by Europa Press, UGT hailed the national agreement as a “collective success.” Speaking from its Rambla del Raval headquarters, the union said the increase brings Spain closer to fulfilling the criteria of the European Social Charter. The charter recommends a country’s minimum wage reaches at least 60% of its average salary.

However, the union was quick to point out that a one-size-fits-all approach is insufficient for Catalonia, where the cost of living is significantly higher than in many other parts of Spain.

“The rising cost of living and the evolution of prices show that the state SMI is insufficient to guarantee a dignified life in the territory,” the UGT statement read.

The union calculates that applying the 60% benchmark to Catalonia’s average salary would require a minimum wage of €1,459 per month. Citing this disparity, UGT de Catalunya is renewing its demand for a specific regional minimum wage, which it terms the ‘Salario Mínimo de Referencia de Catalunya’ (SMRC).

Ensuring the Raise Reaches Pockets

UGT also commented on the technical aspects of the pay rise. It praised the government’s decision to introduce a tax rebate for minimum wage earners, a move designed to prevent higher tax contributions from neutralising the SMI increase.

Despite this positive step, the union is urging the government to go further. It is calling for immediate legislative changes to update the rules on “compensation and absorption.” These rules can sometimes allow employers to absorb a mandatory minimum wage increase into other parts of an employee’s salary package. This includes bonuses or supplements, which effectively cancels out the benefit for some workers. The union wants to ensure the full 5% increase reaches every eligible worker’s payslip.

This push for better pay for the lowest earners comes amid other high-profile labour negotiations in the region, including successful pay deals for the Mossos d’Esquadra police force and ongoing industrial action by Catalan doctors over gruelling working conditions.