Spain has approved a new salary increase schedule for public sector employees. The decision comes after negotiations between the government and the country’s largest labor unions. As early as December 2025, public sector workers will receive their first raise, retroactively covering the entire year.
The updated terms will affect around 3.5 million people working across various government structures. Authorities emphasize that this will be the largest wage indexation in recent years, impacting not only central agencies but also regional and municipal administrations.
Over the next three years, salaries will increase in stages. Each phase will have its own percentage increment, as well as additional conditions tied to inflation levels. Officials say this approach will help maintain employees’ purchasing power and narrow regional disparities.
Pay Increase Schedule
According to the approved plan, in 2025 base salaries will rise by 2.5%. This amount will be paid retroactively from January 1, so employees will receive the difference for the entire past year. In 2026, the increase is set at 1.5%, and if annual inflation reaches or exceeds 1.5%, an additional 0.5% will be added.
The largest jump is expected in 2027—a 4.5% increase at once. The cycle of indexations will conclude with a 2% raise in 2028. In total, salaries will grow by 11% over four years, which is expected to significantly impact public sector incomes.
The Ministry of Digital Transformation and Civil Service notes that all stages of the increase will be implemented automatically, with no need for additional decisions. The only exception is for regions and municipalities, where payment details must be coordinated with local unions.
Who will be affected
The new system covers all employees of government institutions, including administrative staff, education, healthcare, police, and other sectors. However, direct regulation applies to employees of central government bodies. In autonomous communities and municipalities, the payment procedure will be determined locally, but general parameters will remain in place.
Special attention is given to regions with unique living conditions, such as the Canary and Balearic Islands. For them, a separate review of allowances for living and working on the islands is planned for 2026. This is intended to offset additional costs associated with remoteness and the specifics of the local economy.
Authorities emphasize that the indexation is aimed at strengthening social justice and narrowing the gap between different categories of workers. According to the minister, the state is demonstrating its commitment to supporting the public sector and promoting equal opportunities.
Economic context
The implementation of the pay increase became possible thanks to the country’s steady economic growth. According to government estimates, Spain has recorded a lower deficit in recent years compared to several other European countries. This has enabled the government to allocate the necessary funds in the budget for a phased increase in public sector wages.
At the same time, experts note that inflation in the country remains higher than the European Union average. This affects the real purchasing power of the population, especially in major cities and regions with a high standard of living. The new indexation system is designed to partially offset this gap and enhance the appeal of careers in the public sector.
In certain regions, such as Madrid, where the cost of living is traditionally higher, the pay raise will be especially noticeable. This could impact competition between autonomous communities for skilled professionals and encourage greater worker mobility within the country.
Payment procedure
Under the new schedule, payments will begin as early as December 2025. All employees covered by the decree will receive recalculated pay for the entire year. In the future, indexation will occur automatically starting January 1 each year, without delays or additional approvals.
In regions and municipalities, the payment schedule and procedures may differ slightly, as local authorities must coordinate details with labor unions. However, the general parameters of the pay increase remain the same for all categories of employees.
The law took effect immediately after approval, but final adoption will require ratification by the Congress of Deputies. Authorities are confident that majority support will ensure a swift completion of all procedures.
