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In Guatemala, the labor law grants an employee 15 consecutive working days of paid annual leave after completion of 12 months of continuous service with the same employer. The employee must have worked at least 150 days in the year of service to be entitled to leave. Annual leave pay must be issued to the employee before the start of the leave.

Workers must enjoy their vacation period without interruptions and are only obliged to divide them into 2 parts at most. Leave days are not cumulative from year to year. Employees cannot apply unused leave to the following year. However, at the termination of the contract employees can claim compensation in cash for leave that has been omitted in the last 5 years.

Guatemala's labor law stipulates that an employment contract is suspended during an employee's sickness. Workers are entitled to paid sick leave for up to 6 months, provided that the insured employee has at least 4 months of contributions in the 6 months before the sickness begins. The benefits are provided by the Guatemalan Social Security Institute (Instituto Guatemalteco de Seguridad Social) from the fourth day of the temporary suspension of work. Two-thirds of a worker's average earnings is paid as a sickness benefit up to a maximum of 180 days (the benefit may be extended for 39 weeks). The maximum combined benefit for multiple periods of incapacity is 52 weeks in a 24-month period. The Guatemalan Social Security Institute also sets a maximum monthly benefit.

Under the Labor Code of Guatemala, pregnant female employees are entitled to a maximum of 12 weeks (84 days) of maternity leave, including 30 days of prenatal leave and 54 days of postnatal leave.

An employee is entitled to receive her full salary while on maternity leave from the Guatemalan Institute of Social Security, provided she has paid contributions for 4 months in the 6 months preceding the prenatal leave and she is not engaged in any other paid work during the period of leave. If an employee is not registered with the Social Security Institute, the employer pays the full salary.

The Labor Code of Guatemala provides 2 days of fully paid paternity leave for the birth of a child. No qualifying conditions are stipulated regarding the entitlement to paternity leave.

Minimum Wage

The minimum wages in Guatemala, effective from January 1, 2026, are as follows (all values in Guatemalan quetzales, GTQ)

Guatemala's employment law does not mandate a specific payroll cycle. However, it requires employment contracts to specify whether the pay frequency is monthly, bi-weekly, or daily.

Overtime, Holiday & Vacation Pay

An employee who works beyond the standard working hours (8 hours a day and 44 a week) is entitled to overtime pay at 150% of the regular hourly rate.

Hours of work on a weekly rest day and public holiday are considered overtime work and are compensated at a premium rate of 150% of the regular hourly wage rate, which is the total amount of the ordinary and extraordinary payments of the last week or the last 15 or 30 days, depending on whether wages are paid by biweekly or monthly. The law does not require employers to provide a compensatory rest day to employees who work on weekly rest days or public holidays.

Payment for annual leave must be issued to employees prior to its commencement.

Notice Period

In Guatemala, the length of a statutory notice period for termination of an indefinite contract is based on the employee's duration of service.

• 1-week notice for service under 6 months
• 10 days' notice for more than 6 but less than 12 months of service
• 2 weeks' notice for more than 1 year but less than 5 years of service
• 1-month notice for 5 or more years of service

The notice period listed above applies to workers who wish to terminate a contract for an indefinite period without just cause once the trial period has elapsed. These notice periods are not binding on employers and are superseded by a notice period stipulated in an employment contract. If an employer has to terminate an employee due to just cause or misconduct, a written dismissal notice must be provided to the employee before termination.

Severance Benefits

The Labor Code stipulates that an employee dismissed for just cause is not entitled to severance pay. The employer has the burden of proving that the dismissal was justified. Employees dismissed without cause or indirectly are entitled to severance pay equal to 1 month of salary per year of service. Severance must be paid proportionally when the employee works for a part of a year. Employees are not eligible for a severance payment if dismissed during a probationary period.

Pension

In Guatemala, the Social Security Institute (Instituto Guatemalteco de Seguridad Social) administers pensions and social benefits to employees of firms with at least three workers, individuals employed in freight or passenger transport enterprises with at least one worker, and public-sector employees not covered by a specialized system.

The retirement age is 60 years. Employees who have reached retirement age and have paid at least 240 contributions are entitled to an old-age pension. Those with less than 240 contributions but with at least 12 contributions are entitled to the old-age settlement benefit as a lump sum.

There is an Economic Contribution Program for the Elderly, where the government pays a social pension to those who have turned 65 years old, have low income or disability, and have no other pension. This scheme is funded through contributions from high-income individuals and companies.

Dependents/Survivors Benefits

A widow or disabled widower entitled to a survivors pension will receive 50% of the old-age or disability pension the deceased received or was entitled to receive. The minimum monthly widow(er)'s pension is GTQ 170 (Guatemalan quetzales).

Each eligible child younger than age 18 (no age limit if disabled) will receive 25% of the old-age or disability pension the deceased received or was entitled to receive; 50% if both parents are deceased. The minimum monthly orphan's pension is GTQ 85; GTQ 170 if parents are deceased.

A dependent parent will receive 25% of the old-age or disability pension the deceased received or was entitled to receive. The minimum monthly dependent parent's retirement is GTQ 85. The minimum combined monthly survivor pension is GTQ 340.

The maximum combined survivors pension is 100% of the old-age or disability pension the deceased received or was entitled to receive.

Invalidity Benefits

In Guatemala, the social insurance system provides benefits for disabled workers, whether their injury is occupational or non-occupational. To be eligible for benefits, the insured must have contributed for at least 36 months in the last 6 years immediately before disability. There are 2 types of disabilities recognized for benefits, depending on the degree of disability:

• Total disability - If the insured is unable to obtain a remuneration greater than 33% of what is usually received in the same region by a healthy worker, with similar capacity, category and professional training.
• Severe disability - If the insured is unable to obtain remuneration and permanently need the help of another person to perform the acts of ordinary life.

The disability pension is initially granted for 1 year and continued depending on annual evaluation. The disability pension is not payable abroad. It ceases at the regular retirement age and is replaced by an old-age pension. It also ends if the pensioner recovers the ability to work.

Benefits are also provided for work-related and non-work-related accidents or occupational diseases. For cash benefits, the insured must have at least 3 months of contributions before the work injury or occupational disease began. For medical benefits, there is no minimum qualifying period if the insured is in covered employment; unemployed persons must have at least 3 months of contributions in the last 6 months before the work injury or occupational disease began.

Personal Income Tax

Employees with an annual income above GTQ 300,000 (Guatemalan quetzales) are taxed at 7%. Employees with an annual income of less than GTQ 300,000 pay tax at a rate of 5%. Non-residents are taxed at a flat rate of 15% on income sourced in Guatemala.

Visas

In Guatemala, foreign nationals are classified according to their nationality into 3 categories that determine whether a visa is required and how it is issued (A, B, and C).

Visa Types and Validity

Guatemalan visas may be single-entry or multiple-entry:

• Tourist and Visitor Visas (B and C): authorized period of stay is up to 90 days, counted from the date of entry. This stay may be extended once, for a maximum total stay of 180 days. Certain visitors, such as technical, professional, scientific, cultural, sports, or religious specialists who are invited by public or private institutions to carry out paid consulting or advisory activities, may remain in Guatemala for up to 180 days under this category. Single-entry tourist visas are valid for 6 to 12 months, or multiple-entry tourist visas are valid for 1 to 5 years
• Temporary Residence Visas: issued to foreigners who will remain in the country for a specific purpose. These include: migrant workers, students, athletes and artists, investors, intellectuals, researchers, scientists, and religious ministers. They are granted for up to 5 years, except for students, whose residence is tied to the duration of their academic program.
• Diplomatic visa - issued to diplomatic agents and other foreigners holding a diplomatic passport, issued by their respective Government or International Organization.

Work Permits

A foreign national who wishes to work in Guatemala must obtain both a work permit and a residence permit. Most non-immigrant visas for temporary workers offer renewal periods. The initial stay can be 2 or 3 years, depending on the type of work, and can usually be renewed once. The work permit is valid for renewable periods of 1 year. A request for an extension must be filed 15 days before the expiration of the period for which the work permit is issued.

Before obtaining a work permit, an applicant must request a temporary residence permit. Temporary residence is granted for a period of 1 to 5 years, according to the application submitted by the foreign national and the decision of the Guatemalan Migration Institute. A temporary residence permit can be extended. However, if a person wants to stay in Guatemala for a period longer than 5 years, they must apply for a permanent residence permit.

Effective October 7, 2025, foreign remote workers who are employed by foreign businesses may legally reside in Guatemala for 1 to 5 years. Workers must prove an income of at least USD 2,000 (United States dollar) per month in the prior year, or USD 3,000 if they have dependents.

In Guatemala, the minimum age for employment is generally 14. However, the Labor Code allows the Ministry of Labor and Social Security to authorize children younger than 14 to work under exceptional circumstances.

Employees aged 14-18 cannot work more than 7 hours per day (42 hours per week). Minors under 14 years of age are not allowed to work more than 6 hours per day or exceed a weekly total of 36 hours.