Remote’s guide to employing in Costa Rica.
Costa Rican colón
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The Republic of Costa Rica is a sovereign unitary presidential constitutional republic. The Central American country is recognized within the region for its stable democracy, press freedom, and high per capita income. Costa Rica also registers a strong rating on the human development index compared with Latin American neighbours.
Costa Rica’s economy has witnessed significant strides driven by an educated population, diversification from agriculture, and investment and tax incentives that have earned it the colloquial tag of Switzerland of Central America.
Costa Rican colón
5,094,118 (est. 2020)
Ease of doing business
Cost of living index
VAT - standard rate
GDP - real growth rate
To employ in Costa Rica, companies must own a local legal entity in the country or work with a global employment solution. Managing payroll, benefits, taxes, and compliance in Costa Rica can get complicated, especially without established local relationships.
Remote’s global employment solution makes it easy for your company to employ workers in Costa Rica quickly, efficiently, and in full compliance with all applicable labor laws. We take on the responsibility and legal risks of international employment so you can focus on hiring great talent and growing your business.
The Costa Rican Labor Code (Código de Trabajo) is the preeminent statute guiding employment relations and spells out provisions for employee protections and workers’ rights. Employees in Costa Rica enjoy protections against discrimination based on age, religion, sexual orientation, gender expression, and race.
Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Costa Rica.
|Saturday, January 1, 2022||New Year's Day|
|Sunday, April 10, 2022||Holy Week||Vary every year|
|Monday, April 11, 2022||Juan Santamaria|
|Thursday, April 14, 2022||Maundy Thursday||Vary every year|
|Friday, April 15, 2022||Good Friday||Vary every year|
|Sunday, April 17, 2022||Easter||Vary every year|
|Sunday, May 1, 2022||Labor Day|
|Tuesday, July 26, 2022||Annexation of Nicoya|
|Tuesday, August 2, 2022||Virgen de los Angeles|
|Monday, August 15, 2022||Assumption of Mary|
|Tuesday, September 13, 2022||Independence Day|
|Thursday, December 1, 2022||Abolition of the Army|
|Sunday, December 25, 2022||Christmas Day|
The Costa Rican minimum wage is set on a sliding scale depending on an employee’s skill level or educational qualification.
Minimum wage ranges from 9,598.73 CRC per 8-hour workday for unskilled workers to 12,537.91 CRC per day for specialized workers.
The monthly minimum wage ranges from 10,652.48 to 682,607.00 CRC per month depending on the employee’s skill and education level.
Daily wage rates
Monthly wage rates
For customers of Remote, all employee payments will be made in equal monthly installments on or before the last working day of each calendar month, payable in arrears.
We can help you get a new employee started in Costa Rica fast. The minimum onboarding time we need is ten days for your first hire in the country, and just three business days for subsequent hires.
Remote can help you provide a customized and compliant benefits package for your employees in Costa Rica. If you have questions about developing a competitive benefits plan, let us know and we can help.
Learn how employment taxes affect your payroll and your employees’ paychecks in Costa Rica.
30% - Corporate tax rate
9.25% - Health & Maternity
5.25% - Basic Pension Scheme
0.25% - Banco Popular Employer Fee
5.0% - Family Assignations
0.5% - Social Aid: (IMAS)
1.5% - INA
0.25% - Contribution from Banco Popular Employer
3% - Labor Capitalization Fund
0.5% - Complementary Pension Fund
1% - National Insurance Institute
5.5% - Medical and maternity contribution
4.0% - Disability, old age, and death benefits
0% - Up to CRC 817,000 ($1319.28)
10% - CRC 817,001 to 1,226,000 ($1319.28 - $1979.72)
15% - CRC 1,226,000 to CRC 2,103,000 ($1979.72 - $3395.88)
20% - CRC 2,103,000 to CRC 4,205,000 ($3395.88 - $6790.15)
25% - Over 4,205,000 ($6790.15)
Employees are entitled to two weeks of paid vacation annually once they have worked with an employer for an entire year. Many Costa Rican employers increase the number of allotted days off per year as a benefit for the employee.
Employees can take nine paid public holidays off and non-Catholics are entitled to paid time off to observe religious holidays such as Yom Kippur, Eid-el-Fitr, etc.
Whenever the following holidays fall on any day other than a Monday, employees will take the following Monday off in place of the holiday.
And should an employee be required to work on a public holiday, the employer will provide a replacement holiday within 15 days.
Employees are entitled to sickness benefits from both the employer and the social security office, provided they’ve made the latter’s required contributions.
For the first three days of an illness, employees can draw a sickness benefit equivalent to their full wages, with 50% paid by the employer and 50% paid by the social security office.
The employee will draw wages equivalent to 60% of their normal wages from the fourth day, paid by the social security office.
Female employees are entitled to 4 months of maternity leave, starting a month before delivery, and compensated at a 100% rate, paid 50:50 by the employer and the social security office.
There are no provisions for private employees to receive paternity or parental leave under Costa Rican labor law.
Employee contracts can be terminated if a just cause is established, such as dishonesty, negligence, fraud, redundance, or any other tangible reasons, with notice provided in advance and stipulated below.
Notice periods required under Costa Rican law depend on an employee’s tenure, ranging between 1 week and a month.
Severance pay entitlements are issued based on an employee’s tenure with the employer.
The Probation Period is maximum of 3 months. It is common to apply the maximum probation period to senior roles.