Area of law
At AG Legal, our dedicated team of Labor Law specialists provides comprehensive legal support to businesses operating in Costa Rica.
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We assist with employment contracts, compliance with Costa Rican labor laws, and effective resolution of labor disputes. Our experts work closely with your company, offering day-to-day guidance to support your decisions and ensure a harmonious workplace.
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Employees in Costa Rica have legal rights to: A minimum wage, adjusted annually and based on job type or skills. A maximum of 48 work hours per week (8 per day), with special limits for night or mixed shifts. Paid vacation of at least two weeks per year after 50 consecutive weeks. Social security (Caja) coverage, provided by the employer. Benefits including a Christmas bonus (13th-month salary), paid public holidays, and paid sick, maternity, and paternity leave. Discrimination and unjust dismissal are prohibited by law, and employees are protected by the “Reality Contract” principle—even verbal agreements form a binding employment relationship
All employment relationships are subject to Costa Rican law, regardless of nationality. While verbal contracts are valid, written contracts are strongly recommended and must specify: Salary and payment terms (at least minimum wage). Working hours and location. Role description and duration (indefinite or fixed-term). Fixed-term contracts are for specific tasks/projects and must not exceed one year, except for special cases. Employers must clearly distinguish between employees and independent contractors to avoid legal disputes under the “Reality Contract” doctrine
Standard work hours: 8 hours/day, 48 hours/week (day shift). Night shifts: maximum of 6 hours/day, 36 hours/week. Mixed shifts: up to 7 hours per day. Overtime is compensated at 1.5 of the regular hourly rate. Work exceeding four extra hours per day is generally not allowed, except in emergencies
Employers must provide: Social Security (CCSS) and labor risk insurance (INS). Paid annual vacation (minimum 14 days after 50 weeks). Christmas bonus (aguinaldo): a full month’s salary, payable in December. Paid public holidays (including Labor Day, Christmas, Independence Day). Maternity and paternity leave: 4 months for maternity (100% salary), 8 days of paternity leave. Paid sick leave, in accordance with social security guidelines
Employers must register with Costa Rica’s Social Security Fund within 8 days of starting operations and report all employees. Dismissals must comply strictly with the Labor Code—unjust or arbitrary termination may result in mandatory severance and penalties. There are specific notice periods, indemnities, and procedures for both employer- and employee-initiated terminations. Firing without legal cause (and proper documentation) is penalized. Records of payroll, contracts, and payments must be precise and up to date. Government fines for violations can reach up to 12 times the minimum wage or business suspension