Costa Rica
Capital: San Jose
Currency: Costa Rican Colón- CRC
Costa Rica Labor Law and Employment Policies Overview
Employment Law Overview
- Key Legislation:
- Labor Code
- Social Security Law
- Occupational Health and Safety Law
- Legal Characteristics:
- Aimed at protecting employee rights and benefits
- Sets standards for minimum wage, working hours, vacations, and severance pay
Employment Contract Requirements
- Contract Types:
- Fixed-term contracts (maximum one year)
- Indefinite-term contracts
- Contract Provisions:
- Must include job description, compensation, working hours, vacations, etc.
- Language and Currency:
- Contracts must be written in Spanish
- Currency is Costa Rican colón (CRC)
Working Hours Regulations
- Standard Work Hours: 48 hours per week
- Rest Days and Breaks:
- Minimum of one rest day per week
- One-hour break after 8 hours of work per day
Vacation Policy
- Annual Leave:
- 14 days of paid annual leave after 50 weeks of work
- One day of paid leave per month for less than 50 weeks of work
- Public Holidays: 13
- Special Leaves:
- Sick leave: 50% salary paid by employer for first 3 days, 60% by Social Security from day 4
- Maternity leave: 4 months paid leave, 1 month prenatal, 3 months postnatal
- Paternity leave: 8 days of paid leave for public sector employees
Employee Severance and Contract Termination
- Notice Period:
- 3-6 month contracts: 1 week
- 6-12 month contracts: 2 weeks
- 1+ year contracts: 1 month
- Severance Pay:
- 7-22 days of salary, depending on years of service
- Protection Against Unfair Dismissal:
- Employees may be entitled to severance pay for unfair dismissal
Tax Laws
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Personal Income Tax:
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Salary Range (CRC) Tax Rate 0 - 863,000 0% 863,000 - 1,267,000 10% 1,267,000 - 2,223,000 15% 2,223,000 - 4,445,000 20% 4,445,000 and above 25%
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Social Security Contributions:
- Employee: 9.5% of salary
- Employer: 34.5% of salary
Health Insurance
- Insurance Policy:
- Public health insurance funded by Social Security contributions
- Coverage:
- Basic healthcare services
Compensation and Benefits
- Minimum Wage: Varies by industry
- Compensation Structure:
- Salary, bonuses, allowances, etc.
Work Permits and Visas
- Permit Requirements:
- Foreign employees require a work permit and residency permit
- Application Process:
- Employer applies to the General Directorate of Immigration and Foreigners
Confidentiality and Non-Compete Clauses
- Enforceability:
- Enforceable, but must be reasonable and not unduly restrict employee's employment opportunities
- Common Provisions:
- Keeping business information confidential
- Not working for competitors for a certain period
Training and Development
- Legal Requirements:
- Safety training, skills development, etc.
- Government Support:
- Policies to fund or encourage employer-provided training
Workplace Diversity and Inclusion
- Legal Requirements:
- Prohibits discrimination based on race, gender, religion, etc.
- Enforcement:
- Government agencies responsible for enforcing anti-discrimination laws
Remote Work Policies
- Legal Framework:
- Remote work is permitted, but must comply with labor laws
- Tax and Insurance Implications:
- Remote work may impact tax and social security contributions
Authoritative Website Addresses
- Costa Rican Ministry of Labor and Social Security: https://www.mtss.go.cr/