LABOR AND SOCIAL SECURITY
The employment relationship is formalized with an employment contract. This can be registered online, on the Ministry of Labor website. A trial period of 2 months is allowed before being definitively hired.
LABOR OBLIGATIONS OF EMPLOYERS
- File within the first 2 months of the year a report at the Labor Statistics department detailing information about the
employees and the company. - Nursery when having more than thirty female workers.
- Payment of travel expenses if workers travel abroad or within the country.
- Recognize unions and comply with collective agreements.
- Proportional compensation for the time worked after an unfair dismissal.
- Contribute to the Guatemalan Social Security Institute (IGSS in Spanish). The company covers 10.67% of the employee’s monthly salary and the employee covers an additional 4.83%.
- Contribute to the Technical Institute of Training and Productivity (INTECAP in Spanish), which represents 1% of the
employee’s monthly salary. - Contribute to the Recreation Institute for Private Sector Workers of Guatemala (IRTRA in Spanish), which represents 1% of the monthly salary paid to its employees.
FAIR CAUSES OF DISMISSAL
- If the worker does not show up two days in a row or 6 days in the same month, without a fair cause.
- When revealing sensitive information and when violating a non-disclosure agreement.
- When having to serve a sentence.
- Any serious offense that is contemplated in the employment contract.
LABOR BENEFITS
- Workers must receive the seventh day off, after working 6 consecutive days. If they work that seventh day, they must be paid as “overtime”. There are 13 recognized national holidays.
- After a year of uninterrupted work, the employee must be granted at least 15 days of vacation.
- Annual bonus: equal to 100% of an ordinary salary, must be paid in one payment on July 15th.
- Christmas bonus: equal to 100% of the ordinary salary, payable in 2 installments, the first half on December 15th and the second half on January 31st.
- Compensation, applies in case of dismissal when there is an indefinite contract, and is equivalent to a monthly salary per year worked.
- Grant permits with pay to employees in the events set out by law (death of spouse, marriage, birth of child, subpoenas, and union duties).
WORKING SHIFTS MUST FALL WITHIN THE FOLLOWING RANGE:
The ordinary workday could be extended up to 4 hours a day.
Every extra hour must be paid 1.5 times the regular hour payment.
WAGES
The minimum wage is established by the Guatemalan Government, currently it is in force in the following structure:
The Labor Code (Decree 1441) is the main regulatory framework in terms of labor relations; it creates the institutions that
provide oversight over labor dispute settlement and enforcement. Another legislation associated to labor relations is the
Constitution of Guatemala, Convention 175 of the International Labor Organization, the Labor Code, Decree 19-2018, and
Government Accord 242-2018.
Source: Guatemalan Institute of Social Security (IGSS 2017); Labor Code (Decree 1441); Ministry of Public
Finances – Government Accord 242-2018
*The amounts can vary according to the current reference exchange rate, the reference exchange rate
for this document is US$1 = 7.64