Employment Law

Employment Contracts in Chile

We strongly recommend that all employers in Chile provide each employee with a written employment contract. The contract should contain all the necessary details of the employment agreement, such as wages, leave, working hours, responsibilities, etc. It should also be written in the official language of Spanish and use the Chilean peso currency.

Fixed Term

Indefinite

Working Hours in Chile

The standard working week in Chile is 45 hours. Workers are entitled to at least one day off per week, which for most people is Sunday. Overtime pay must be at least 180% of regular wages.

Holiday Policy

Chile Vacation

In Chile, workers who have worked for their employer for at least one year are entitled to at least 15 days of paid leave.

Chilean Sick Leave

Employees in Chile are entitled to paid sick leave if they present a medical certificate as proof of illness. Generally, they will only be compensated if they are absent from work for more than three days.

Parental Leave in Chile

Female employees in Chile are generally entitled to 18 weeks of paid maternity leave, 6 weeks before and 12 weeks after the birth. Part of their compensation is subsidized, and the employer can choose to top up the remainder.

After the birth of a child, the father can take five days of paternity leave.

Additional parental leave is also available, shared between parents.

Termination and Severance in Chile

Generally speaking, employees in Chile are entitled to receive one month's notice before terminating their contract. They are also usually entitled to severance pay of one month's salary, with additional severance pay based on their years of service with the employer.

Chilean Taxes and Withholding Taxes

Chile provides several mandatory social security contributions for employers and employees. Employee contributions are generally withheld by the employer. Employees typically pay the following fees:

• 10% of salary goes to pension
• Life insurance between 2.84% and 3.4%
• 7% goes to health insurance
• 0.6% Unemployment Insurance Benefit

Employers generally need to contribute 0.9% to 4.4% of wages to work-related injury insurance and unemployment insurance, and 2.4% to the unemployment fund.

County income taxes range from 0% to 35.5%, depending on income level.

Chile's corporate tax is generally 25%.

Health Insurance in Chile

Employees must pay health insurance premiums, and these contributions are often withheld by the employer (see above). Some employers do choose to offer additional private health insurance as a benefit.

Salary and Benefits

Chilean Compensation Law

The minimum wage for a full-time employee in Chile is 320,500 pesos per month.

Benefits Administration in Chile

Setting up a benefits system for the Chilean workforce can be difficult and complex if you are not familiar with the country, its customs and employment laws.

Outsourcing your benefits administration processes ensures you fully understand and follow the rules, ensuring your compliance and significantly speeding up the process. Our Chilean employment experts will help you find and arrange your benefits, advise you on your strategies, and ensure compliance with the law.