What you'll learn
- Country Introduction
- Tax Breakdown for Employers
- Statutory Leave Laws
- Minimum Wage and Working Hours
- Termination Process
- Additional Information
El Salvador is country in Central America that is bordered by Honduras, Guatemala, and the Pacific Ocean. It is the smallest country in Central America known as the land of volcanoes. In 2001 the country changed its official currency to the US Dollar, and in 2021 it passed legislation to make Bitcoin legal tender in El Salvador.
Paid Leave and Statutory Leave
Parental Leave
Pregnant employees can receive up to 16 weeks of paid maternity leave, which is paid at 75% of the regular salary. At least 6 weeks of the leave need to be taken before the due date and up to 10 weeks after the birth. The leave can be extended if there are any complications.
Fathers are entitled to 3 days of paternity leave within 15 days of the birth, which is paid at 100% of the regular salary.
Sick Leave
Employees in El Salvador are entitled to sick leave, with amounts based on how long they’ve been employed at the company. The sick leave is paid at 75%
- 1-5 months = 20 days
- 5 months-1 year = 40 days
- 1+ years = 60 days
Paid Leave
There are 11 public holidays in El Salvador, and employees who have worked at least 1 year at their company are entitled to 15 days of paid time off each year.
In El Salvador, paid time off is paid at 130% of the regular salary and paid to the employee before their time off. Any vacation days that are unused are lost and not financially compensated. Employees can also request 1 day of paid bereavement leave per year.
Wage Requirements and Working Hours
There is no minimum wage in El Salvador since each sector determines their own. The average minimum wage is USD 365 per month. The standard workweek in El Salvador is 44 hours per week, for 8 hours a day over 5.5 days. Any work done past the standard hours is paid as overtime generally at around 200% of the salary.
Termination Process
Process
The termination process in El Salvador varies based on whatever is stipulated in the employment contract.
Notice Period
The notice period is also stipulated within the employment contract. While a notice period for termination is not mandatory in El Salvador, it is a common practice for employees to provide a minimum of 7 days of notice to leave the company.
Severance Pay
Severance pay will depend on the reasons for termination. Severance is not required in cases of resignation or if a fixed contract’s terms have elapsed.
Severance is generally calculated as 30 days of wages for every year at the company.
Additional Information
It’s common to pay a 13th month salary bonus to employees in December. The amount depends on how long the employee has worked at the company:
- 1-3 years = 15 days wages
- 3-10 years = 19 days wages
- 10+ years = 21 days wages
★ 7.5% - Social Security
★ 7.75% - Pension Fund
★ 1% - INSAFORP
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