Madrid Despite objections from employers’ associations, Spanish ministers decided on Tuesday to implement one of the coalition government’s major policies: reducing the legal working week to 37.5 hours without affecting salaries.
Labor Minister Yolanda Diaz, the leader of the hard-left party Sumar, wrote an executive decree proposing the reduction from the existing 40 hours, which the cabinet accepted during its weekly meeting.
Diaz told reporters, “This proposal is about living better, working less, and being much more productive and efficient economically.”
In parliament, where the center-left government of Socialist Prime Minister Pedro Sanchez lacks a clear majority and must balance the demands of multiple smaller parties to pass legislation, the bill still needs to be passed.
The promise to cut working hours by the end of 2025 was a key component of Diaz’s party’s support for Sanchez’s premiership. Diaz is also the deputy prime minister.
However, the biggest employer group, CEOE, has stated that the proposal will increase the prices of Spanish companies and reduce their competitiveness, and the center-right Catalan separatist party, Junts, has already shown opposition to it.
The CEOE claimed that the shortened week should be implemented through collective bargaining to meet the needs of each enterprise, rather than by law, and negotiations with it broke down in November following months of discussions between Diaz and unions and employers’ representatives.
According to CEOE chief Antonio Garamendi, the business community supports conversation but opposes monologue.
Diaz also criticized Economy Minister Carlos Cuerpo for allegedly supporting employers when he suggested postponing the transition for a year to allow small firms to adjust.
Both the former economy minister and Spain’s central bank have issued warnings that rising labor expenses may exacerbate inflation and impede the development of new jobs.
Following the cabinet vote, Cuerpo stated that corporations may oppose the change because of Spain’s robust economic growth, falling inflation, and 16-year-low jobless rate.