Municipal staff: contract signed – pay rises of 152 euros

A record-breaking figure and an unprecedented development are the two main features of the 2025–27 national collective agreement for the 404,000 employees of regional and local authorities, signed at ARAN at lunchtime on Wednesday 21 July.

The figures

Barring any surprises – which are always possible at the negotiating table – today’s agreement would come less than five months after the final signing of the previous three-year deal, reached on 23 February. The actual negotiations lasted a total of three months, thus replicating the accelerated timetable followed for the education sector, where, however, the agreement concerned only the pay aspect. This final push, which will continue at the next Council of Ministers meeting with the green light for the 2025–27 contracts for ministries, tax agencies and public bodies, and the 2022–24 contracts for school heads, is intended to bring the effects on pay packets forward as much as possible; in local authorities – and this is the unprecedented aspect – these increases will be slightly higher than the sector average: €152 per month (€154 for ‘highly qualified’ staff) compared with €141 (back pay ranges from €920 to €1,170 depending on pay grade).

The new contract, which must now undergo the standard checks by the General Accounting Office and the Court of Auditors before being finally signed and coming into force, draws on the fund established under the latest Budget Act, 50 million in 2027 and 100 from 2028, which is in addition to the 998.81 million, once fully operational, to be borne by local budgets to reduce the pay gap that penalises local government employees and drives them to move, where possible, to local authorities with more generous pay packages. For the time being, the fund is modest and reserved for local authorities, which employ almost 85 per cent of the sector’s workforce, whilst the 48,000 employees of provincial and metropolitan authorities remain excluded, despite their salaries not differing significantly from those of their municipal colleagues. However, the novelty of the Budget Law (paragraph 674 of Law 199/2025) is the first centralised and structural funding for local authority staff, and it could be the first cog in a mechanism to be strengthened in the future: public finance balances permitting.

Still on the subject of pay packets, it is worth noting a set of new rules on supplementary pay components, particularly for ‘highly qualified’ staff (i.e. middle managers occupying the highest tier of non-executive staff). To fund these posts, which are characterised by a position-based salary of between 5,000 and 22,000 euros per annum, public bodies will be able to allocate a portion of the savings generated by not fully utilising recruitment quotas for new staff, thereby increasing resources up to a ceiling set by the draft legislation at 15 per cent of the total.
In this context, special attention is being paid to local authorities without senior managers – that is, the more than 7,000 municipalities (just under 90 per cent of the total) that are too small to have senior staff on their payroll. For these, the structure of the decentralised fund is greatly simplified, in both its fixed and variable components; and a further boost is given to joint management schemes, to promote supplementary welfare and training initiatives.
In an attempt to resolve a complex legal issue, the agreement provides for the payment of allowances relating to shift work and working conditions even on days off.
The provision mirrors what was already set out in the Central Functions agreement signed on 9 June: the same applies to the new safeguards to be implemented in the event of the use of artificial intelligence and to the review, in July 2027, of any discrepancies between pay trends and inflation.