Business confederation proposes 3% minimum salary increase

Money

The Spanish Confederation of Business Organisations (CEOE) would accept an increase in the Minimum Interprofessional Salary (SMI) of 3% annually for 2024 and 2025, until reaching 1,145.77 euro per month. According to the employers’ association, this increase complies with what was agreed with the unions and is more than what they are going to raise for civil servants.

Given the “immediate” call of social agents that the Minister of Labour and Social Economy, Yolanda Díaz, announced a week ago to negotiate a new increase in the Minimum Interprofessional Wage (SMI), businesses have gone ahead to present a proposal that would establish the increase in these salaries by 3% in 2024 and an equal percentage in 2025.

Thus, the figure proposed by the CEOE would increase the SMI by 32.40 euro as of next January 1, or what is the same: 1,112.40 euro per month in 14 payments or 15,573.60 annual gross euro. This amount would rise to 1,145.77 euro per month in 2025, or 16,040.80 euro gross per year.

As explained by the CEOE, both 3% increases are included in the Agreement for Employment and Collective Bargaining that the employers signed with the unions a few months ago. Thus, “business organisations consider this proposal appropriate to try to maintain a correlation between the evolution of the SMI and that of the rest of the salaries that are agreed upon within the framework of collective bargaining,” they expressed.

In addition, the employers’ association established as a mandatory condition to agree on this increase in the SMI the modification of the price review regulations in public contracting and subcontracting. As explained, businesses that have signed a contract with the Administration prior to the increase in the minimum wage cannot currently review the conditions of their public contracts, having to assume the increase in costs and considerably reducing their profit.

The increase proposed by CEOE, as explained by the employers, would be in line with what was signed with the unions in the collective bargaining. It could also comply with the Government’s commitment to link the minimum wage to 60% of the average salary throughout the legislature, taking into account that, according to the latest available data, the SMI already maintains this proportion with the average salary.

Furthermore, the employers indicated that raising the Minimum Interprofessional Salary (SMI) by 3% during this year “is above the 2% salary increase applied to civil servants for 2024” by the Administration, so businesses and the self-employed would already have to endure a greater increase in salary costs than public companies.

Although, as this newspaper already reported, the exact amount that the Government will propose is not yet known. It will depend on the decision of a commission of experts that is working on this matter, and that will set the criteria that the Minister of Labor maintains at the negotiating table.

To this difference we would have to add the increase in other labour costs that a new increase in the SMI would have for the self-employed with employees and businesses. For example, the social contributions paid by them to Social Security or the Intergenerational Equity Mechanism (MEI), which are set based on the employees’ salary.

However, the organisation chaired by Antonio Garamendi has linked its support for the 3% increase in the SMI to the Government modifying the price review regulations in public procurement. According to them, the current regulation does not allow businesses that work for an administration to review the price of their contracts when their labour costs necessarily increase due to the increase in the minimum wage.