Employer Payroll Tax
Employee Payroll Taxes
Employee Income Tax
The monthly minimum wage in Chile is 326,500 CLP.
There are no provisions in the law regarding 13th salaries.
A full workweek in Chile is 45 hours. The employer has the right to extend the day by no more than 2 hours a day, or 10 hours a week.
Overtime is paid at a rate of 150% of the regular pay.
Employees who have been employed for at least 1 year are entitled to 15 working days paid leave.
There are 16 public holidays in Chile.
In Chile, employees are entitled to sick leave if they can provide a medical certificate within 2 days from the beginning of the leave. The employer must then forward the certificate to the health insurance within 3 days.
- For the first 3 days of sick leave, the employee is not entitled to pay
- From the 4th day on, employees are entitled to sick pay, however, it may be subject to a cap.
In Chile, the woman is entitled to 30 weeks of paid maternity leave, divided by 6 weeks before the birth and 24 weeks after, and is paid by health insurance.
During the pregnancy, the woman is not required to participate in activities that would endanger her health (i.e. heavy lifting). If this is a requirement of the job, the employer must reassign her to a different position during her pregnancy without pay reduction.
Fathers are entitled to 5 days of paid paternity leave.
After the 7th week of birth, the mother can opt to transfer some or all of her maternity leave to the father.
Female employees are entitled to 10 days of parental leave for a child under the age of 18. While the employee is entitled to be paid, they must make up the time taken off at a later date.
Bereavement Leave- If a member of the employee’s immediate family passes away, the employee is entitled to 3 days of paid leave.
In order to terminate an employee, the cause must first be decided. By law, the following reasons are valid reasons for termination:
- Mutual agreement, resignation, or expiration of a contract
- Breach of contract (employer must be able to provide proof)
- Company needs or reorganization (the most common reason for the dismissal of an employee)
The employer must prepare a letter for the employee stating the cause for termination as well as the effective date and it must be signed in person by the employee or sent by certified mail to their home address. In addition, the same letter must be filed with the Chilean Labor Ministry. It is common that the employee is notified on the last day or work.
After the termination letter is given, the employer must prepare a severance agreement which must include the cause for termination as well as the amount that will be paid out to the employee. The severance agreement must be signed within 10 days of the termination.
In the case of a mutual agreement, both parties must sign a document acknowledging that both parties have agreed that the employment contract is terminated. A severance agreement must also be signed within the first 1-2 weeks following the termination date.
The notice period is 1 month by law. It is common that the notice period is waived and payment is made in lieu.
If the employee has completed at least 1 year of employment, they are entitled to severance pay. For every year of service up to 11 years, the employee is entitled to 1 month’s salary. In addition, after one year of employment, the employee accumulates an additional month of severance pay if they have worked for at least half of the following year.
19% standard rate.