SMI 2025: extension and restrictions on dismissal

According to Royal Decree Law 16/2025, of December 23, Chapter IV incorporates two labour measures with a direct impact on cost management and redundancy decisions. On one hand, the validity of Royal Decree 87/2025 is extended and, consequently, the minimum wage established for 2025 is maintained from January 1, 2026, until the approval of the royal decree that determines the minimum wage for 2026, with the aim of ensuring normative continuity and avoiding gaps in the minimum wage reference.

On the other hand, the regulation strengthens the labour conditionality linked to certain public aids, so that, in companies benefiting from direct aids provided for in the same royal decree law, the increase in energy costs cannot be invoked as an objective reason for dismissal until December 31, 2026, and, furthermore, non-compliance with this limitation will result in the return of the aid received. Likewise, when a company benefits from working time reductions or contract suspensions under Article 47 of the Workers' Statute for reasons related to the invasion of Ukraine and receives public aid, it cannot use these same reasons to carry out dismissals.

In practical terms, these provisions require a review of traceability between aids and staff adjustment decisions, as the risk is not limited to the labour sphere but may also result in an immediate economic contingency due to the reimbursement of aids. Therefore, it is advisable to reinforce the coherence of the reasons for objective dismissals during the restriction period, avoiding the increase in energy costs as a direct or indirect reason, and align any internal flexibility strategy under Article 47 of the ET with subsequent measures to avoid incompatibilities.

Article written by the Labour Law Department of ECIJA Madrid.