Beyond reduced hours: the job market Yolanda Díaz wants to open after the summer

MadridGiven the lack of parliamentary support, the Spanish government decided to postpone the process until after the summer. the negotiation of the reduction of the working day to 37.5 hours per week. It is one of the great promises of the current legislature, especially for the person who has championed it from the very beginning, the second vice president and Minister of Labor, Yolanda Díaz, who is also the visible face of Sumar, the minority partner in the coalition government.

However, it is not the only labor-related file that the government, and Díaz in particular, must take out of the drawer after the summer holidays. After reaching an agreement with the PSOE for the approval of new paid leaves for birth and childcareThis second half of the year will be marked by improved wages and tougher layoffs, among other economic policies.

Months of delay in reducing working hours

In June, faced with the proposed amendments to the entire framework, which included reducing the working week to 37.5 hours without affecting wages, the government decided to postpone the negotiation and vote in the Congress of Deputies until September. Although optimistic, Díaz lacks the bound votes of the investiture partners to push the measure through. This complicates the intention of requiring companies to adapt their collective bargaining agreements to the measure before December 31, 2025.

The party that sees the most problems is, primarily, Junts. In fact, one of the amendments to the entire framework is theirs. The outright rejection of shorter working hours by the Catalan and Spanish employers' associations has also played a key role in Junts' position.

The minister must get Carles Puigdemont's party to withdraw the amendment so that the law can at least be processed. This would open the door to introducing modifications and, therefore, finding a text that convinces Junts. "We are making progress in supporting SMEs [when it comes to reducing working hours]," Díaz stated in an interview on RNE at the beginning of August. The Minister of Labor has proposed incorporating direct aid to these companies, as well as to the self-employed, and making exceptions to the rollout of reduced working hours to convince Junts. Likewise, Treball has also expressed openness to reconsidering measures against absenteeism, which employers like, although this has generated "concern" among some of the left-wing partners, such as Podemos.

Along with the reduction in working hours, there is a reinforcement of the right to disconnect, as well as a stricter time recording. In this regard, Díaz has warned that she could approve this last element separately, in a Council of Ministers meeting and without needing the approval of the Congress of Deputies.

Interprofessional minimum wage

Díaz wants to convene social partners to negotiate a new increase in the minimum interprofessional wage (SMI) for 2026. "After the summer, we will continue to raise the SMI," he stated during the interview on RNE. The 50-euro increase in 2025, which left the SMI at 1,184 euros gross per month in 14 installments, it was agreed with CCOO and UGT, but without the Spanish employers' association CEOE.

In parallel with the social dialogue, Díaz will convene the committee of experts on the minimum wage (SMI) to recommend how much it should increase. The committee of experts is responsible for advising the Spanish government on the increase in the minimum wage. It includes members of the executive branch, social partners, and academic professionals. It was established in 2021 to determine how the minimum wage should be increased to translate into 60% of the average salary, as established by the European Social Charter. Beyond social dialogue, Díaz will have to speak with the Ministry of Economy, which has always been cautious when it comes to advocating for significant increases. Since 2018, when Pedro Sánchez took office, the minimum wage has accumulated a 61% increase. The latest increase benefited approximately 2.4 million workers.

Beyond an increase in the minimum wage, unions and employers must resume negotiations this fall for a new agreement for employment and collective bargaining (AENC), the state framework of reference for companies and workers when reviewing collective agreements and, therefore, future wage increases. The current AENC covers the years 2023, 2024, and 2025.

Changes to dismissals

A file that unions have long been demanding to be opened, but that employers refuse to hear about, is that of severance pay linked to dismissal. The CCOO (Working Workers' Union) and UGT (General Workers' Union) have even taken the battle to Europe, and the European Committee of Social Rights has sided with them, making it clear that severance pay paid after a worker loses their job is not sufficient to compensate for the harm suffered or to dissuade the employer from firing them. In Spain, the Supreme Court has already made it clear that if it wants to be addressed, it must be through legislation, not the courts.

After several unsuccessful attempts to modify them (which was proposed during the 2021 labor reform), Díaz wants to channel a reform that takes into account the European Social Charter. In fact, the government agreement between the PSOE and Sumar includes a commitment to establish "guarantees for workers against dismissal, complying with the European Social Charter and reinforcing the causality of termination of employment relationships." The Ministry of Labor is considering taking into account the personal and employment circumstances of the dismissed worker.

Internship Statute

"We will put an end to fake internships," Díaz stated a few days ago. The Internship Statute has been shelved for over two years. Following an agreement with the unions, the text was submitted for public consultation and received the approval of the State Secretariat for Employment in 2025.The friction with the PSOE on this matter has been constant.However, they have now been resolved, and their final approval by the Council of Ministers should also arrive this second half of the year. Afterwards, it will then be passed to the Congress of Deputies, leaving its final approval and entry into force up in the air.

The Internship Statute unifies criteria on unpaid work placements. Furthermore, it incorporates a minimum weekly and annual rest period, just like for workers. Another major new feature is company coverage of essential work-related expenses, such as transportation, meals, or accommodation, as long as the student is not receiving other assistance.