After intense negotiations, the Spanish government has given the green light to reduce the weekly working hours from 40 to 37.5 without a salary cut. However, at this stage, the government has not yet secured the necessary majority for the bill to pass in Parliament.

"This is a historic day," stated Labor Minister Yolanda Díaz, a member of the left-wing Sumar party, following the approval of the reform by the Council of Ministers. “Reducing working hours will improve productivity in our country (…) There is no point in spending endless hours at work—the key is effectiveness.”

The reform is a flagship initiative of Spain’s left-wing coalition, aimed at modernizing labor laws and improving work-life balance.

The approved bill follows a December 20 agreement between the government and Spain’s two largest labor unions, UGT and CCOO. However, business associations had withdrawn from negotiations in November, after eleven months of fruitless discussions.

Employers argue that not all industries can be equally affected, and a blanket reduction in working hours could harm the competitiveness of some businesses.

Labor Minister Díaz dismissed these concerns, emphasizing Spain’s economic stability, which recorded 3.2% growth last year. “We have more jobs than ever before and stronger economic growth than ever before. Spain must modernize,” she stated.

As part of their October 2023 government agreement, Sumar and the Spanish Socialist Workers' Party (PSOE) committed to reducing working hours to 37.5 by December 2025 without impacting wages.

The reform is expected to affect nearly 12 million private-sector employees, particularly those in commerce, hospitality, and agriculture. Meanwhile, the 37.5-hour workweek is already in place for public sector workers and employees in large companies.

Beyond opposition from businesses, the main challenge for Prime Minister Pedro Sánchez’s Socialist government is convincing its parliamentary allies to support the bill.

While Basque Nationalist Party (PNV) has expressed reservations, the biggest hurdle comes from Junts per Catalunya (JxCat), the Catalan separatists who, despite backing the government, are known for their pro-business stance.

Without their support, the reform faces an uncertain path in Parliament.