Costa Rica
Hire Employees & Contractors

Costa Rica

Compliantly hire your distributed team members in

Costa Rica

Person working on laptop

Hiring in

Costa Rica

isn't so simple. Borderless can help.

To hire new employees in

Costa Rica

, your business must have a local legal entity or an Employer of Record like Borderless in place already. Then there’s the management of local employment compliance, taxes, benefits, payroll, and more. Hiring contractors poses similar challenges.

Borderless handles all of that for you, so you can focus on getting to work with your new team member in

Costa Rica

while staying fully compliant with local laws and compliance.

Primary Language

Spanish

Currency

Costa Rican colón (₡, CRC)

Payroll Frequency

Monthly

Public Holidays

10 days

Employer Taxes

26.50%

Cost of Living Index

50.64 (2021)

Statutory Leave

10 days

Sick Leave

No limit

Maternity Leave

4 months

Important: Risks of misclassification

In many countries like

Costa Rica

, the treatment of employees and contractors is different. If you misclassify a new team member, you could be subjected to penalties and fines. Let Borderless get this right for you, so you don’t have to worry.

Payment Information

Minimum Wage

The minimum wage in Costa Rica is based on employee's skills and education background. The minimum wage is from 9,598.73 CRC per 8 hour shift for unskilled employees to 12,537.91 CRC per day for specialized workers. The following are the monthly wages:

  • Unskilled workers: CRC317,915.58 ($513.36)
  • Semi-skilled workers: CRC 342,027.40 ($552.30)
  • Skilled workers: CRC 359,544.27 ($580.59)
  • Highly skilled workers: CRC 403,764.18 ($651.99)
  • Diversified education qualified workers: CRC 376,776.77 ($608.41)
  • Technical workers with superior education: CRC 464,335.93 ($749.80)
  • Technical workers with higher education diploma: CRC 501,500.15 ($809.81)
  • Technical workers with university bachelors: CRC 568,819.86 ($918.52)
  • Technical workers with graduate qualification: CRC 682,607.23 (1,102.26)

Overtime Pay

The standard working hours in Costa Rica are 8 hours per day and 40 hours per week.

Additional Pay

It is mandatory to pay employees 13th month salary. The 13th month salary must be paid by December 20th and it has to be equivalent to 1 month's salary.

Payroll Cycle

Employee payments will be made in equal monthly instalments, payable in arrears, on or before the last working day of each calendar month.

Employer Costs & Taxes

  • 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

Employee Costs & Taxes

  • 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)
  • Employment Information

    Termination Process

    Termination must have a just cause. For example, fraud or redundance.

    Notice period

    Notice periods are determined by the length of employment. Employee who worked 0 to 3 months do not require notice, employees who worked 3 to 6 months require 1 week of notice, and employees who worked 6 to 12 months require 15 days of notice. Employees who worked more than 1 year are entitled to 1 month of notice.

    Probation Period

    The maximum probation period is 3 months.

    Severance Details

    Employees who voluntarily quit with cause or are let go without cause are entitled to severance pay. Severance pay is determined by the length of employment and their salary wage.

    • Employees with 3 - 6 months tenure: 7 days pay
    • Employees with 6 - 12 months tenure: 14 days pay
    • Employees with 1 year tenure: 19.5 days pay
    • Employees with 2 years tenure: 20 days pay
    • Employees with 3 years tenure: 20.5 days pay
    • Employees with 4 years tenure: 21 days pay
    • Employees with 5 years tenure: 21.24 days pay
    • Employees with 6 years tenure: 21.5 days pay
    • Employees with 7 - 9 years tenure: 22 days pay
    • Employees with 10 years tenure: 21.5 days pay
    • Employees with 11 years tenure: 21 days pay
    • Employees with 12 years tenure: 20.5 days pay
    • Employees with 13 or more years tenure: 20 days pay
    Benefits of working in a country abroad

    Borderless Benefits Packages in

    Costa Rica

    When the world is your competition, it pays to incentivize new hires and existing alike. Borderless benefits packages typically include:

    Medical Insurance
    Dental Insurance
    Vision Insurance
    Life Insurance
    Retirement Contributions

    Learn how to hire quickly and easily in

    Costa Rica

    Book your demo of Borderless to help you hire, pay, and take care of new employees and contractors in 170+ countries.

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