Labor proposes a 4% increase in the SMI, which unions and employers do not accept

The agreement to increase the interprofessional minimum wage (SMI) in 2024 is getting complicated.

Oliver Thansan
Oliver Thansan
11 December 2023 Monday 10:40
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Labor proposes a 4% increase in the SMI, which unions and employers do not accept

The agreement to increase the interprofessional minimum wage (SMI) in 2024 is getting complicated. Yesterday the Ministry of Labor made public its proposal, an increase of 4%, so that the SMI would go from the current 1,080 euros per month to 1,123; but it did not find acceptance either from the unions, although they see options to move forward, or from the harder employers.

In particular, the CEOE sets a difficult condition to fulfill, that the increase in the SMI has an impact on the contracts that private companies have with the public administration. The second vice-president and Minister of Labor, Yolanda Díaz, said that she would transfer the request to the Treasury, but her colleague María Jesús Montero was quick and clear in her answer, she does not accept it.

Labor specified the percentage increase at 4%, in line with what it had indicated in recent days. An intermediate figure between the 3% proposed by the CEOE and the 5% demanded by the unions. Seeing the limited distance in the numbers, it seems that there are real options for a consensus. However, considerable obstacles remain. The main one is the condition that the CEOE already included in its proposal of November 22, to modify the legislation to allow the increase of the SMI in the execution contracts of the public sector. A usual claim, but this time elevated to a condition sine qua non.

The complaint comes from the contracts in force with the public administration in labor-intensive sectors and in which any increase in the SMI leads to an increase in expenses that companies cannot transfer. Quantifying the impact of this situation is difficult. As a rough estimate, the CEOE calculates that the companies that provide services to the public administration employ 1.4 million people, and that these companies would be affected in one way or another by the non-indexation.

Another condition of the employer, although not defended with the same intensity, is a 20% reduction in the business quota for quotas common to the agricultural sector.

After the meeting, the second vice-president and Minister of Labor, Yolanda Díaz, said that she sees the consensus close. "I am convinced that we are close to reaching an agreement. The demands between the employers and the unions are not far away and, for the good of the country, we will be able to achieve it", said Díaz, adding that he will transfer the request to modify public contracts to the competent ministries.

However, the response from the Treasury arrived after a few hours: a resounding no to this indexation. "The increase in the SMI cannot be at the expense of the collection of all Spaniards", stated the fourth vice-president and Minister of Finance, María Jesús Montero, who added that "it would not make any sense that the increase in the "SMI was at the expense of the public administration having to face a higher cost of the services they provide". A refusal that makes it very difficult to reach consensus with the employer.

On the part of the unions, the approach of 4% is also not accepted, which is lower than CC.OO's objectives. and the UGT However, the two unions have pointed out that they could end up accepting the figure depending on how the negotiation develops.

The deputy general secretary of union policy of the UGT, Fernando Luján, said that "if we reach an agreement that guarantees that the SMI covers the losses due to the increase in prices and satisfies our European commitments, on this path we will be able to find the UGT". For her part, the secretary of union action and employment of CC.OO., Mari Cruz Vicente, declared that "for CC.OO. the increase was supposed to be 5%, but we are willing to negotiate". An element that Vicente emphasized is his opposition to the 20% bonus in the rural sector if there is no commitment to comply with the collective agreements and to apply the SMI in the agreements in which it does not apply.