The State of São Paulo has approved an update to its state minimum wage, effective 1 June 2026. The State Legislative Assembly passed the bill on 13 May, the Governor signed it into law and it was published in the Official Gazette on 28 May as Law 18.471/2026. The new wage floor is set at R$ 1,874.36, representing an increase of approximately 3.9% compared to the previous figure of R$ 1,804.
For Spanish companies with subsidiaries, branches or locally hired staff in São Paulo, this update has direct and immediate effects on labour cost structures and payroll compliance obligations. Failing to act in time can lead to non-compliance that generates labour contingencies and sanctions from the Brazilian labour inspectorate.
What the São Paulo minimum wage is and who it affects
Brazil has a national minimum wage, set at R$ 1,621 for 2026. The São Paulo state minimum wage is a complementary wage floor, always higher than the national level, which applies to professional categories that do not have a wage floor defined by federal law, collective bargaining agreement or collective work agreement.
According to the State Government, the measure affects more than 70 professional categories, including domestic workers, carers, janitors, motorcycle couriers and fishermen, among others. For companies, the key is to identify which positions in their local workforce fall within the scope of the São Paulo minimum wage and which are governed by their own collective instrument. Where a floor has been agreed in a collective agreement, the rule more favourable to the worker will always prevail.
The aspects that require immediate review
The entry into force of the new wage floor on 1 June 2026 requires companies to urgently review several aspects of their labour management in the state. First, the update of payroll for all employees remunerated on the basis of the state floor. Second, the recalculation of labour and social security charges linked to the base salary, which in Brazil include items such as FGTS, employer INSS contributions and provisions for holiday pay and the thirteenth salary, all of which are calculated on the worker’s base remuneration.
Additionally, it is worth reviewing whether there are any internal company benefits referenced to the base salary, as their update may have a cascading effect on the worker’s total remuneration. For companies managing their São Paulo workforce from Spanish headquarters, it is important to ensure that locally used payroll management systems reflect the new floor from the first day it takes effect.
The broader context: operating in Brazil requires continuous regulatory monitoring
Brazil is one of the most complex and regulated labour markets in the world. Legislation is updated frequently, collective agreements vary by sector and region, and the consequences of non-compliance can be significant both in economic and reputational terms. The São Paulo minimum wage is just one of the elements that companies with a presence in the state must monitor on an ongoing basis.
For Spanish companies managing their Brazilian operations from headquarters or with small local teams, having a specialist team that carries out that monitoring and advises on the practical implementation of each regulatory change is not a luxury: it is an operational necessity that prevents costly contingencies.
At Feliu N&I, we support Spanish companies in managing their operations in Brazil and across Latin America, including labour and social security compliance, review of remuneration structures and continuous adaptation to the country’s regulatory changes. If your company has employees in São Paulo or in any other Brazilian state, we can help you ensure that your labour management meets the requirements currently in force at all times.
Contact us for a personalised consultation.
