The strike is expected to last three weeks with one day on and one day off, as Spain's 6,150 dockers fear that opening up the sector to competition will put their jobs and salaries at risk.
Announcing the decree on Friday, Spain's Public Works Minister Inigo de la Serna told reporters the work stoppage risked impacting the economy in a country still recovering from a financial crisis.
Spain's 46 main ports are key for the country's exports and contribute 20 percent of the transport sector's GDP, and more than one percent of overall economic growth, according to the Platform for Investors in Spanish Ports.
The cabinet gave the green light to the decree more than two years after the Court of Justice of the European Union ruled Spain must reform the sector, or face sanctions.
Currently, domestic or foreign companies can only hire dockers to load and unload ships from specific, already-established Spanish groups known as Sagebs that select, train and provide personnel, and no other firm.
De la Serna said it was "the only economic sector where there is no freedom to hire."
The decree will eventually allow companies to contract workers wherever they want.
But the sector's union said it would "only destablilise one of the most prosperous industries in this country."
In a statement, the State Coordinator of Maritime Workers also defended the work stoppage as a way to fight for the rights of the country's dockers - among the few who "maintain decent working conditions," with good salaries for demanding labour.
The decree, however, still has to be validated by Spain's parliament.