Overview

Capital
Managua
Currency
Nicaraguan córdoba
Date Format
dd/mm/yyyy

Taxes

Employer

Employer Payroll Tax

12.5%
Pension and Disability (less than 50 employees)
13.5%
Pension and Disability (more than 50 employees)
6.0%
Health Insurance
1.5%
Labor Healthcare
1.5%
War Victims
up to 22.5% Total Employment Cost
Employee

Employee Payroll Taxes

4.75%
Pension & Disability
2.25%
Health Insurance
7.0% Total Employee Cost

Employee Income Tax

0-100,000 NC
0%
100,001 NC - 200,000
15%
200,001 NC - 250,000 NC
20%
350,001 NC - 500,000 NC
25%
500,001 NC +
30%
Employer Taxes
3 HIGHEST
3 LOWEST
Brazil
China
Belarus
Nicaragua
South Africa
Georgia
Macedonia
87.39%
44.5%
34%
22.5%
2%
2%
0%
Employee taxes
3 HIGHEST
3 LOWEST
Romania
Macedonia
Netherlands
Nicaragua
Georgia
Belarus
Ukraine
45%
28%
27.65%
7%
2%
1%
0%

Minimum Wage

General

In Nicaragua, the minimum wage varies depending on the industry with agriculture, forestry, and fishing being the lowest at 4,286.33 NIO per month and construction, financial institutions, and insurance is the highest at 9,592.4 NIO per month. 

Minimum wage (per month)
$2391
$2255.28
$1996
$127
$36.80
$22
$2.33
Luxembourg
Italy
Australia
Nicaragua
Angola
Uzbekistan
Venezuela
3 HIGHEST
3 LOWEST

Payroll

Payroll Cycle

Payroll cycles depend on the type of employment. Manual workers are paid weekly and employees are paid every 15th day. 

13th Salary

Employees receive a 13th salary within the first 10 days of December. 

Working Hours

General

The working hours depends on the hours of the day:  

  • Day work between the hours of 6 am and 8 pm- A typical workday is 8 hours or a maximum of 48 hours per week 
  • Night work between the hours of 8 pm and 6 am- A typical workday is 7.5 hours or a maximum of 45 hours a week.
Overtime

Overtime pay is paid at a rate of 200%.   

For work over a weekend or holiday, the employee is entitled to a 24hour rest period in lieu.  

Leave

Paid Time Off

Employees who have completed at least 6 months to 1 year of employment are entitled to 15 days of paid leave.  After 1 year of employment, the employee is entitled to 30 days of paid leave. 

Vacation days
Public holidays
3 HIGHEST
3 LOWEST
Brazil
Peru
Georgia
Nicaragua
Mexico
Malaysia
Federal
30
13
43
30
12
42
24
17
41
30
9
39
6
8
14
8
6
14
10
10
Public Holidays

There are 9 public holidays.

Sick Days

Sick leave is paid from the 3rd day of illness and the benefit is for up to 6 months and is covered by social security.  Pay for sickness is 60% of the regular wages.   

However, if the employee is hospitalized, the 3 day waiting period is waived.  

Maternity Leave

Maternity leave is 12 weeks and is paid at the rate of 100% of the regular wages in which 60% of this is paid by the employer and 40% is paid by social security. Maternity leave can begin 4 weeks from the expected due date.   

For multiple births, maternity leave is extended to 14 weeks.   

PAID MATERNITY LEAVE (DAYS)
410
365
365
84
45
30
0
Bulgaria
Serbia
Albania
Nicaragua
United Arab Emirates
Tunisia
Federal
3 HIGHEST
3 LOWEST
Paternity Leave

Fathers are entitled to 5 business days of paid leave.  

Parental Leave

There is no statutory law on parental leave in Nicaragua.

Termination

Termination Process

To terminate employees, employers must request for termination from the labor inspection department. At the time of dismissal, the employee is entitled to remaining vacation pay and their annual bonus. Notice of termination is also required.

Notice Period

Employees must provide 15 days notice.

Severance Pay

The employer must pay severance when the employee is terminated for an unjust cause.  The severance pay is calculated at one month’s salary for the first 3 years of employment and 20 extra days of wages for every year after. Severance is capped at 5 months in payments.

Probation Period

The probation period is 30 days, during which either party can terminate the employment agreement for any reason.  

VAT

General

VAT is 15% standard rate.

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