Spain’s minimum wage, the salario mínimo interprofesional (SMI), stands at EUR 1,221 a month in 14 payments, or EUR 17,094 a year, but only until 31 December 2026. The decree that set it, Real Decreto 126/2026, covers 1 January to 31 December 2026, and as of 26 October no 2027 figure has been approved. The 2026 rise was 3.1%, and the Government estimates it reached about 2.5 million workers.

The deadline is now tangled with politics. The Cortes have been dissolved ahead of the general election on 29 November, and the Ministry of Labour and Social Economy wants the 2027 figure decreed before polling day. Unions are asking for at least 7%, about EUR 1,306 a month. If the decree slips past the vote, an acting government with limited powers will have to decide whether to raise the minimum wage or simply extend the current one, as happened in December 2019.

For you, that means one practical question: what will your January payslip show? This guide sets out the current figure, the maths for both outcomes on the worker side and the employer side, and what past gaps tell you about January.

1. The current minimum wage: EUR 1,221 and who it covers

The 2026 SMI is EUR 40.70 a day or EUR 1,221 a month, for any activity in agriculture, industry or services, regardless of the worker’s sex or age. It went up by EUR 37 a month and EUR 518 a year compared with 2025. According to the Government, the minimum wage is now 66% higher than in 2018, an increase of EUR 485.10 a month.

The figure is gross. La Moncloa’s own explainer puts it plainly: “The Minimum Wage refers to the gross wage of workers. The 1,221 euros per month in 14 payments represents the total amount of the payroll.” Only cash pay counts towards it: pay in kind can never reduce the cash amount, and a shorter working day is paid pro rata.

The SMI is set nationally, under the State’s exclusive competence over labour legislation, so it is the same in every region. Article 27.1 of the Estatuto de los Trabajadores (Workers’ Statute) obliges the Government to fix it every year after consulting the most representative unions and employers’ associations, weighing consumer prices, average productivity, labour’s share of national income and the general economic situation. Under Article 27.2, the SMI cannot be seized by creditors.

One detail matters for anyone paid under a collective agreement: if your total annual pay was already above the SMI, the revision does not change its structure or amount. For that comparison the annual SMI can never be taken as less than EUR 17,094. When Pedro Sánchez signed the 2026 agreement on 16 February, he called it “a very significant step towards improving the lives of 2.5 million workers”.

2. Why 2027 is a race against the election calendar

The 2026 rise of 3.1% is already below September’s annual inflation rate of 4.9%, and in early September the Government confirmed that a 2027 increase would come. Joaquín Pérez Rey, Secretary of State for Labour, said at the time that the Government had to put measures on the table to stop workers from becoming poorer.

On 8 October, after the first meeting of the 2027 expert committee, Yolanda Díaz, Second Vice-President and Minister of Labour, said every company needs to know on 1 January what the minimum wage is, and that the rise would go ahead normally despite the election bringing deadlines forward. The committee’s report is due at the end of October or early November.

Employers see it differently. Antonio Garamendi, president of the CEOE employers’ confederation, said it was “increíble” (incredible) that the Government was using its power in the middle of an election campaign this way. Lorenzo Amor, president of the self-employed association ATA, complained that the decision was being taken without considering those who pay the wages. CCOO has added its own condition: in September, CCOO’s Javier Pacheco warned that the union would not agree a new SMI unless the Government approved the royal decree promised in the 2026 agreement, linked in press reports to the postponed reform of how pay supplements are absorbed.

After 29 November, the Government becomes an acting government. Under Spain’s rules for acting governments, it is limited to ordinary business unless it can justify urgency or the general interest. A new SMI amount is harder to fit inside those limits than a simple extension of the old one.

3. Net pay and employer cost: the 2027 maths in two scenarios

Start with 2026. A full-time SMI worker on an open-ended contract earns EUR 1,221 in each of 14 payments. Social security is calculated on a monthly base of EUR 1,424.50 (the SMI plus one sixth for the two extra payments), at a combined worker rate of 6.50%: 4.70% common contingencies, 1.55% unemployment, 0.10% vocational training and 0.15% MEI (the Intergenerational Equity Mechanism surcharge).

In an ordinary month that means EUR 92.59 in social security and about EUR 37.36 in income tax withholding, leaving roughly EUR 1,091.05 in hand. Over the year, net pay after social security is EUR 15,983. The withholding (about EUR 523 a year) comes back through the 2026 tax return filed in 2027, because a special income tax deduction makes the 2026 SMI tax-free. If your own pay is above the minimum, it is worth taking your gross salary and working out your net salary for 2027 under both outcomes below.

On the employer side, the 2026 rates add 30.65% on top of gross pay: 23.60% common contingencies, 5.50% unemployment, 0.20% FOGASA (Wage Guarantee Fund), 0.60% training and 0.75% MEI. That is EUR 5,239 a year, for a total employer cost of EUR 22,333 per full-time SMI worker, before the occupational accident premium, which varies by activity.

Now 2027. By our calculation, assuming 2026 contribution rates except for the MEI surcharge, which rises to 1% in 2027 (assuming the same split as in 2026, roughly five sixths employer and one sixth worker):

• Freeze or extension at EUR 1,221: employer cost rises to about EUR 22,348, roughly EUR 14 more a year, purely from the MEI step. Net pay for the worker slips to about EUR 15,980, a few euros less than in 2026, and the income tax deduction still covers the full tax bill.
• 7% rise to about EUR 1,306 a month (EUR 18,291 a year): employer cost rises to about EUR 23,912, an increase of about EUR 1,579 per worker per year. If the income tax deduction is updated to the new SMI, net pay reaches about EUR 17,099, roughly EUR 1,116 more than in 2026.
• 7% rise with the tax deduction left unchanged: net pay would be about EUR 16,276, only EUR 293 more than in 2026, because most of the gross increase would go on income tax and social security.

The income tax catch: a deduction pegged to EUR 17,094

Real Decreto-ley 5/2026, validated by Congress on 18 March 2026, raised the income tax (IRPF) deduction for earned income to EUR 590.89 a year when gross employment income is EUR 17,094 or less. Above that, it shrinks by 20 cents for every extra euro earned, disappearing at EUR 20,048.45. The deduction applies only if other non-exempt income stays under EUR 6,500.

That peg is the risk. At EUR 18,291, the deduction would fall to about EUR 351.57, while the tax calculated before the deduction would be roughly EUR 1,174 under the Tax Agency’s 2026 withholding method, leaving about EUR 822 to pay. Final liability depends on state and regional scales, so treat this as an indicative figure. The trade-off is not new: for 2026, the expert committee proposed 3.1% if the SMI stayed untaxed or 4.7% (EUR 1,240 a month) if it paid income tax, while CEOE and Cepyme proposed up to 1.5%. Unless Hacienda (the Ministry of Finance) lifts the deduction again, a higher 2027 SMI could start paying income tax.

4. What history says about a January without a decree

Spain has been here before, almost every year. The 2019 jump was the largest on record: 22.3%, from EUR 735.90 to EUR 900 a month. Since then the SMI has moved to EUR 950 in 2020, EUR 965 in 2021, EUR 1,000 in 2022, EUR 1,080 in 2023, EUR 1,134 in 2024, EUR 1,184 in 2025 and EUR 1,221 in 2026.

In most of those years the new decree arrived in January or February, so the previous one had to be kept alive. Between the end of 2019 and the end of 2023, a year-end decree-law extended the old SMI until the new one was approved: Real Decreto-ley 18/2019, 38/2020, 32/2021, 20/2022 and 8/2023. For 2026, the Labour Ministry relied on an interpretative criterion instead. In every case, the previous year’s figure stayed as the legal floor.

The closest parallel to this year is December 2019. The acting government at the time extended the 2019 SMI by decree-law rather than raising it. The preamble of Real Decreto-ley 18/2019 argued this was within its powers precisely because it was not a revision of the amount, only a temporary extension until a new decree was approved. The raise to EUR 950 came on 4 February 2020, from the newly formed government, backdated to 1 January.

Backdating is the norm, not a guarantee. The 2020, 2022, 2024, 2025 and 2026 decrees all applied from 1 January with back pay. In 2021 the rise to EUR 965 applied only from 1 September, so workers received no increase for the first eight months. If you are interviewing for a role paid at or near the minimum, ask at the job interview how the company will apply the 2027 figure and whether it will pay arrears if the decree arrives late.

5. Special minimums: temporary, domestic, trainee and part-time workers

The SMI is not one number for everybody. In 2026, these rules apply:

• Temporary and seasonal workers whose service with the same company does not exceed 120 days must receive the SMI plus the pro-rata share of Sunday and public holiday pay and of the two extra payments, and never less than EUR 57.82 per legal working day.
• Domestic workers paid by the hour on a live-out basis are entitled to at least EUR 9.55 per hour actually worked, an amount that includes all pay items.
• Training contracts, both dual training and work-experience contracts, can never pay less than the SMI in proportion to the time actually worked.
• Part-time workers are paid the SMI pro rata to their working day.

Any 2027 decree will update the daily, hourly and annual figures together. A transitional rule means the new amounts do not automatically apply to regional or local rules, or to private contracts in force, that use the SMI only as an income reference, unless those authorities or the parties decide otherwise.

6. Who earns the minimum wage, and how it compares

Government data on the 2025 rise, based on Labour Force Survey (EPA) microdata, shows how concentrated minimum-wage work is. On average 12.9% of employees benefited, from 20.8% in Extremadura to 6.7% in the Basque Country. Women made up 65.8% of beneficiaries, and 26.8% of employees under 24 were affected. By sector, the share was 31% in agriculture, 14.3% in services, 5.9% in industry and 3.4% in construction. For 2026, Andalucía, Madrid, the Comunitat Valenciana and Cataluña have the largest number of beneficiaries.

The wider pay picture explains why the SMI touches so many people. In INE’s Annual Wage Structure Survey for 2024, average gross pay was EUR 29,540.26 a year, but the median was EUR 24,497.17 and the most frequent wage only EUR 16,520.18. Hospitality had the lowest average pay, at EUR 17,653.42. If you work in hospitality, agriculture or other services, check typical salaries in Spain for your role before the 2027 figure lands, so you know whether you are near the floor.

The Tax Agency’s payroll statistics show the same compression from another angle: in 2024, when the SMI rose 5%, the band of employees earning between 1 and 1.5 times the minimum grew by 208,000, more than any other band. If your pay sits in that band, see how your salary compares with what others in the same role earn: a rising floor tends to squeeze the gap between entry-level and experienced staff.

Conclusion: what to expect on 1 January 2027

The possible outcomes are now clear. If the Government approves the 2027 decree before 29 November, the new figure should be in place for 1 January. If it does not, history points to the 2026 figure of EUR 1,221 staying in force as the floor until a new government decides, with back pay likely but not guaranteed. Either way, the next adjustment will hinge on the expert committee’s report and on whether Hacienda moves the income tax deduction in step.

If you are planning a move in 2027, update your CV now, while employers are still setting next year’s budgets. And if you want to know where better-paid options are, look at open jobs in your sector and compare them with what a minimum-wage contract will pay after tax and social security.

FAQ: Spain’s minimum wage in 2027

What is the minimum wage in Spain right now?

EUR 1,221 a month in 14 payments, EUR 17,094 a year or EUR 40.70 a day, under Real Decreto 126/2026, valid until 31 December 2026.

Has the 2027 minimum wage been approved?

No. As of 26 October 2026 no 2027 decree exists. The Labour Ministry aims to approve it before the 29 November election, and unions are asking for at least 7%, about EUR 1,306 a month.

What happens if there is no decree on 1 January?

In past gaps, the previous year’s SMI stayed as the legal floor until the new decree was approved, and most decrees applied from 1 January with back pay. The exception was 2021, when the rise applied only from 1 September.

Will a higher minimum wage pay income tax?

It could. The EUR 590.89 IRPF deduction is pegged to EUR 17,094. A 7% rise with no change to the deduction would leave roughly EUR 822 a year in income tax by our estimate.

How much does a minimum-wage worker cost an employer?

About EUR 22,333 a year in 2026 for a full-time worker on an open-ended contract, before the occupational accident premium. A 7% rise would add about EUR 1,579 a year.