Minimum wage increases planned for next three years

THE national minimum wage is set to go up by 4% before the end of 2017 and will steadily rise between now and the year 2020, Spanish president Mariano Rajoy has pledged.

European Union recommendations state that the minimum wage in the 28 member States should be at least 60% of the average salary, and at €707.60 a month for a full-time, 40-hour-a-week job, Spain is still lagging behind.

Until it was increased by 8% earlier this year, the minimum wage was around €655.

However, given that this is based upon 14 payslips a year – a double salary in August and at Christmas – it would work out at €825.33 for those working for firms which pay 12 monthly wages per annum, nowadays the majority.

Income of less than €12,000 per year is not normally subject to tax or, if it is deducted, is refunded the following summer.

For 2018, Rajoy intends to increase the minimum wage to €735.90 a month over 14 months, which would be €858.55 a month over 12 months.

He says this would 'serve to send out a message to companies and unions', both of which are responsible for setting wages for firms and industries.

“We want salaries to go up,” he declared.

Rises of 6% in 2019 and 10% in 2020 would bring the minimum wage to €860 a month over 14 months, or €1,003.33 a month over 12 months – approximately the figure the left-wing opposition says should be the very least a full-time worker should have to live on.

Secretary-general of the Labourers' Commissions (CCOO), Unai Sordo, says it is 'necessary' for a 'major increase' to be applied to salaries to 'recover lost spending power' during the financial crisis.

“Spain's minimum wage is the fourth-lowest in the EU in relation to countries with the same level of productivity and with a minimum salary in force,” Sordo reveals.

“The nation's economic growth should be reflected with an increase in salaries, since the financial crisis has hit those earning the lowest wages the hardest.”

To reach the 60% target, the minimum salary would need to be at least €1,000 a month over 12 months, given that the national average take-home is €1,667, or €1,429 over 14 months.

During the financial crisis, a high percentage of jobs only offered the minimum wage or slightly above it, bringing down the average.