Spanish Prime Minister Mariano Rajoy reached an agreement with trade unions and company representatives on Tuesday which will see the country's lowest paid workers receive 28.4 euros more a month in 2018.
By 2019, Spain's minimum wage will theoretically be raised to 773 euros, a 5 percent increase, and in 2020 it will go up to 850 euros a month, which equates to a 10 percent rise.
“(Spain has suffered) an intense devaluation of it salaries,” Unai Sordo, leader of Spain's largest union, the Workers' Commissions, said after signing off on the agreement.
“This is a boost to rebuild the salaries of people who lost most in the economic crisis.”
Spain's unions can consider the decision a victory, having long called for wages to reflect Spain's fast-paced economic recovery from the 2013 recession, but the agreement's actual implementation is still subject to two conditions.
Spain's GDP growth must be of more than 2.5 percent in the previous year and the average number of people affiliated to the social security system has to increase by 450,000 for minimum wage to be bumped up.
Current trends do indicate that these targets are realistic. The Spanish government's end-of-year growth forecast for 2017 is 3.1 percent and the county's unemployment rate dropped to its lowest level in almost nine years in the third quarter.
But even with an increase in salaries Spain remains in Group 2 of Eurostats's minimum wage pyramid, alongside other countries such as Portugal, Greece, Malta and Slovenia where the lowest legal wages are between 500 and 1000 euros.
Group 3, encompassing countries with the highest minimum wages in EU Member States, include France, Germany, the Netherlands, Belgium, Ireland and Luxembourg, where lowest monthly income is above 1000 euros.