🎊 We’ve raised the largest seed round in our industry $14.1M 🎊

Central America

Honduras

Request Info
Employer of Record (EOR) in Honduras

What you'll learn

  • Country Introduction
  • Tax Breakdown for Employers
  • Statutory Leave Laws
  • Minimum Wage and Working Hours
  • Termination Process
  • Additional Information
Honduras Introduction

Honduras is a country in Central America bordered by Guatemala, El Salvador, Nicaragua, the Pacific Ocean, and the Gulf of Honduras. The country’s economy is mostly based on agriculture which accounts for 14% of its GDP. Honduras has extensive forests, marine, and mineral resources, and the landscape consists mainly of mountains, narrow plains, a large undeveloped lowland jungle, and the heavily populated Sula Valley.

Paid Leave and Statutory Leave

Parental Leave

Pregnant employees are entitled to a minimum of 42 days of leave before the due date and 42 days of leave after the due date. This leave is paid for jointly by the employer and social security. There are no provisions for paternity leave.

Sick Leave

Employees are entitled to 26 weeks of paid sick leave, which can be extended to 52 weeks after 3 days of observation. Sick leave is paid for by the employer in the first 3 days, and from the 4th day IHSS will pay for 66% of the ceiling rate while the employer covers the difference between that and the employee’s salary.

Paid Leave

There are 11 public holidays in Honduras, and employees are entitled to paid time off each year based on how long they have worked at their company:

  • 0-1 years = 10 days of paid leave
  • 1-2 years = 12 days of paid leave
  • 2-4 years = 15 days of paid leave
  • 4+ years = 20 days of paid leave

Employees can also receive paid leave for bereavement, marriage, and civic duty.

Wage Requirements and Working Hours

The minimum wage in Honduras varies based on industry and company size, with an average of HNL 10,008.14 to HNL 13,346.47. The standard workweek is 44 hours with a maximum of 12 hours of overtime per week. Overtime work/pay is regulated by employment contracts and collective agreements, ranging from 137.5% to 200% of the regular pay.

Termination Process

Process

Employers can terminate a contract for reasons related to business, personal, or workers misconduct. Termination requires written notice and explanation for the termination. If terminating for misconduct, the employer needs to give a warning and a chance for the employee to explain their actions. The employee can choose to take the employer to court for unlawful dismissals, and be due compensation or reinstatement if the employer cannot provide evidence of just cause.

Notice Period

The notice period in Honduras depends on the length of employment:

  • 0-3 months = 24 hours notice
  • 3-6 months = 1 week notice
  • 6 months-1 year = 2 weeks notice
  • 1-2 years = 1 months notice
  • 2+ years = 2 months notice

Severance Pay

Employees who are terminated for unjust cause are entitled to severance depending on how long they worked at the company:

  • 3-6 months = 10 days of wages
  • 6 months-1 year = 20 days of wages
  • 1+ years = 1 month of salary for every year of employment (up to 25)

Additional Information

Employees in Honduras are entitled to both a 13th month and 14th month salary, each equal to 1 month of wages. One payment is made in July and the other in December.

OVERVIEW
Language(s):
Spanish
Currency:
Honduran Lempira (HNL)
Capital City:
Tegucigalpa
Population:
10.2 Million
Cost of Living Rank:
76th
VAT (Valued Added Tax):
15%
Employer TaxES
16.6%
(estimated)

★  5% - Healthcare (IHSS)

★  3.5% - Disability, Old Age, Death

★  1.5% - Pension

★  4% - Labor Coverage Insurance

★  2.6% - Collective Capitalization Pillar

Simplified Global HR and Payroll.
Let’s work on it together.

We've made the process really simple
with only 3 steps.

1

Remote candidate

You've sourced a full-time employee or contractor located in a country where your company is not incorporated.

2

Cost Calculation

Pass us the details of your candidate and we will let you know exactly what it costs to employ your candidate in that country.

3

Onboarding & Admin

Sit back and relax as we onboard your new team member and take care of all the local compliances and admin work.

Same-day onboarding
Best Pricing
Available in 150+ countries
How Remofirst employs in Honduras

It can be prohibitively expensive to establish an entity in every country you want to hire talent in, so Remofirst will hire and pay your employee on your behalf while you manage their daily duties. Remofirst will handle formal HR procedures and employment contracts that adhere to local laws, so that you can simply approve invoices via our platform. When you work with an Employer of Record (EOR) you can compliantly hire the best employees around the world.

How employees in Honduras get paid
Your employee's hours, time off, holidays, bonuses, and commissions are automatically calculated into payroll. Remofirst will invoice you in either US Dollars (USD), Euros (EUR), British Pounds (GBP), Canadian Dollars (CAD), or Singapore Dollars (SGD) around the 15th of each month to make sure your employees in Honduras are paid on time in Honduran Lempira (HNL). To make it even easier, you can summarize your entire global team's salaries to aggregate them into one payment (instead of many individual payments).
Full-time Employees vs Global Contractors

Unlike full-time employees, contractors work on projects with multiple companies at a given time and are technically self-employed. Full-time employees are solely focused on their employer and usually receive benefits (such as health insurance, equity or stock options, and time off) as an additional form of compensation. While it can be cheaper to work with international contractors instead of paying benefits to a full-time employee, you run the risk of misclassification. It's recommended to work with an EOR for contractor onboarding and payments, so you can know that your international contractors are paid compliantly and on time.

Dependable support for employees
Whenever the employee or employer has a question about benefits, Visas, or anything else related to international employment in Honduras, they can use our platform's chat function to get answers from our team of experts. Every client of Remofirst also receives a dedicated account manager that will serve as a point of contact for global HR support.