COUNTRY

Written Agreements

In El Salvador, the Labor Code requires individual labor contracts to be submitted in writing to the General Directorate of Labor within 8 days of signing. The contract must also be provided to the employee within 8 days of the commencement of employment. If the agreement is not made available to the employee, they can contact the General Directorate of Labor to conduct an inquiry into the matter.

The employment contracts must be drafted in Spanish and contain the essential terms enumerated in the Labor Code.

Oral Agreements

The Labor Code of El Salvador allows the use of oral contracts for agricultural workers. In such cases, every 15 days, the employer will be required to extend, at the worker's request, a signed certificate written on common paper which contains:

• The name and surname of both parties
• The time of service
• The salary received in the last 2 weeks.
• The place and date of issue of the document

Non-agricultural contracts must be submitted in writing to the General Directorate of Labor within 8 days of signing and provided to the employee within 8 days of the commencement of employment.

Implied Agreements

There is no provision in the labor law of El Salvador for the use of implied contracts.

Per the Labor Code, the working time in El Salvador cannot exceed 8 hours in a day or 44 hours in a week. All work done over this limit is considered overtime and must be remunerated at 200% the ordinary salary.

If a job requires the completion of dangerous or unhealthy work during the day, working time cannot exceed 7 hours a day or 39 hours a week. For jobs that require the completion of dangerous or unhealthy work during the night, working hours cannot exceed 6 hours a day or 36 hours a week.

Teleworking is strictly voluntary for both the employee and employer and there must be a written agreement between the parties where the terms and conditions are established.

The Labor Code of El Salvador recognizes the following paid public holidays:

• New Year's Day - January 1
• Thursday, Friday, and Saturday of Holy Week - date subject to change annually
• Labor Day - May 1
• Feast of San Salvador - August 6
• August 3 and 5 - holidays in the city of San Salvador
• Independence Day - September 15
• All Souls' Day - November 2
• Christmas - December 25

According to the Labor Code of El Salvador, employees are eligible for an annual leave of 15 days after 1 year of work with the same employer. The employee must have worked for at least 200 days in the year to qualify for the annual leave.

The employee is entitled to a benefit equal to the ordinary salary plus a 30% surcharge for the duration of the leave. The remuneration for leave must be paid to the employee immediately before its start.

Per the Labor Code of El Salvador, an employment contract can be suspended during a period of employee illness. Employers must pay an amount equal to 75% of the employee's base salary for the duration of illness.

The number of days allowed for the suspension of the contract depends on the employee's seniority.

In El Salvador, employees are entitled to receive up to 16 weeks of paid maternity leave.

The employee must use 10 weeks of maternity leave after the birth of the child. In case of any complications, the leave can be extended in the prenatal period. Employees who have made at least 12 weeks of contributions and remained with the same employer for at least 6 months are eligible for maternity benefits paid by the Social Security System. Maternity benefits are equal to 75% of the employee's basic salary for the duration of maternity leave.

Employees in El Salvador are entitled to 3 days of paid paternity leave, which may be taken within 15 days of the birth of the child (or date of adoptive judgment for adoptive parents). To enjoy this leave, the employee must present a birth certificate or certificate of adoption.

Minimum Wage

The labor law of El Salvador guarantees a minimum wage for all employees. The minimum wage rates vary by sector and entered into force on August 1, 2021. The most prominent sectoral minimum wages are:

Textiles and clothing maquila sectors - USD 11.81 (United States dollars) daily, USD 359.16 monthly

Industry, commerce and services sectors, sugar mills, and other agribusiness activities - USD 12.00 daily, USD 365.00 monthly

El Salvador's labor laws do not specify the frequency of wages. Weekly, bi-weekly, or monthly pay is common in different industries.

Overtime, Holiday & Vacation Pay

Per the Labor Code of El Salvador, any overtime work done by the employee must be compensated at 200% of the employee's ordinary hourly salary. Overtime work can only be agreed to occasionally when required by unforeseen, special, or necessary circumstances. The law does not offer provisions requiring a higher overtime rate to be paid for work done during a weekly rest day or public holiday.

In the case of annual leave, employees are entitled to a benefit equal to the ordinary salary plus a 30% surcharge for the duration of the leave. The remuneration for leave must be paid to the employee immediately before its start.

Notice Period

The Salvadoran Labor Code does not generally require employers to give notice of dismissal to individual employees. However, prior judicial authorization is required for certain collective dismissals, and the authorities may order a notice period in such circumstances.

Severance Benefits

For de facto dismissals (dismissals without cause), workers are entitled to receive compensation equivalent to 30 days' pay for each year of service (or portion thereof) with a minimum severance payment of 15 days' pay. The same severance payment is applicable if an employment contract is terminated because the employer breaches its obligations.

No severance payment is due if the dismissal was for a justified reason, such as employee misrepresentation, misconduct, or insubordination.

Pension

The necessary age to qualify for an old-age pension in El Salvador is 60 for men and 55 for women, provided the employee has made at least 25 years of contributions.

The insured has 3 different payment options:

• Make programmed withdrawals
• Purchase an annuity from a private insurance company
• A combination of both options

For workers who opted to switch from the old social insurance program to the individual account program in 1998, the value of accrued rights under the previous program is combined with the individual account balance at retirement. The pension is paid for up to 20 years (240 monthly payments and 20 Christmas payments) if the programmed withdrawals option is chosen. The monthly benefit must be at least the minimum monthly old-age pension for all payment options.

Dependents/Survivors Benefits

According to the labor law of El Salvador, dependents of a deceased insured person may qualify for a survivors pension (pension de sobrevivencia, mandatory individual account). Eligible survivors include the widow(er) or cohabiting partner who lived with the deceased for at least three years, orphans younger than age 18 (age 24 if a student; no limit if disabled), and dependent parents.

Invalidity Benefits

For total disability, 50% of the insured's base salary is paid as a monthly disability pension. The base salary is the insured's average monthly earnings in the last 120 months. The minimum monthly disability pension for total disability is USD 207.60 (U.S. dollars). If the worker qualifies for a partial disability pension, 36% of the insured's base salary is paid. The minimum monthly disability pension for partial disability is USD 145.32.