Hire employees
and contractors in Chile

Remote’s guide to employing in Chile.

Capital city
Santiago
Currency
Chilean Peso (CLP)
Population size
17,574,003 (2017)
Language spoken
Spanish
01

Facts & stats

The Republic of Chile (República de Chile) is a unitary presidential republic that’s famous for its long, and beautiful coastline, wild llamas, and rich cultural diversity.

With just 4% of South America’s population and landmass, Chile still boasts the fourth largest GDP on the continent, the highest human development index, the second-highest per capita income, comparatively low corruption level, and one of the lowest crime levels in the Americas.

Chile Map
  • Capital city
    Santiago
  • Currency
    Chilean Peso (CLP)
  • Language spoken
    Spanish
  • Population size
    17,574,003 (est. 2017)
  • Ease of doing business
    Easy
  • Cost of living index
    49.33 (2021)
  • Payroll frequency
    Monthly
  • VAT – standard rate
    19%
  • GDP - real growth rate
    1.1% (2019)
02

Grow your team in Chile with Remote

To employ in Chile, companies must own a local legal entity in the country or work with a global employment solution. Managing payroll, benefits, taxes, and compliance in Chile can get complicated, especially without established local relationships.

Remote’s global employment solution makes it easy for your company to employ workers in Chile quickly, efficiently, and in full compliance with all applicable labor laws. We take on the responsibility and legal risks of international employment so you can focus on hiring great talent and growing your business.

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Chile risks illustration

Risks of misclassification

Chile, like many other countries, treats self-employed individuals or contractors and full-time workers differently and there are risks associated with misclassification.

03

Employing in Chile

The Chilean Labour Code spells out provisions for employee protections, workers’ rights, and general employment relations applicable to Chile’s workforce of 8.8 million. Employees in Chile enjoy protections against discrimination based on age, religion, sexual orientation, gender expression, and race.

Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Chile.

Public holidays

Date Holiday Name Extra information
New Year’s Day
Good Friday
Holy Saturday
Labour Day
Battle of Iquique
Feast of Saint Peter and Paul
The Feast of Our Lady of Mount Carmel
Feast of Assumption
Independence Day
Day of the Glories of the Army
Day of the Races
National Day of the Evangelical and Protestant Churches
All Saints’ Day
Feast of the Immaculate Conception
Christmas Day
Minimum
Wage

The Chilean president sets a minimum wage annually and there are generally two rates for working adults on one hand, and for minors and retirees.

  • 18+: 326,500 Chilean pesos ($440)
  • Under 18 and over 65: 243,561 ($318)
Fixed-term
Agreements

Fixed-term agreements are contracts with a start and end date.

A fixed-term contract can only be limited to a one-year term (or two years for certain highly skilled professionals). This will turn into an indefinite duration contract:

  • after its second renewal
  • immediately at the term lapse, if the employer does not expressly terminate the employment on the grounds of completion of the term
  • if the parties have agreed to more than 2 employment contracts during a 12 month period, or more contracts during a 15 months period
  • if the contract exceeds the maximum term allowed (one or two years depending on the employee’s qualifications)
Payroll
Cycle
For customers of Remote, all employee payments will be made in equal monthly instalments on or before the last working day of each calendar month, payable in arrears.
04

Competitive benefits package in Chile

Remote can help you provide a competitive and compliant benefits package for your employees in Chile. If you have questions or would like to offer a custom benefit, let us know and we can help.

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05

Taxes in Chile

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Chile.

  • Employer

    • 27% - corporate tax rate
    • 2.4% - unemployment insurance
    • 0.95% - occupational accidents
  • Employee

    • Up to 40% - personal income tax rate (depends on salary and other variables)
    • 10% - pension contribution
    • 0.6% - unemployment insurance
    • 7% - health insurance
06

Types of leave

Paid
time off

Employees who have worked with an employer for at least one year are entitled to 15 working days of paid vacation annually.

Public
holidays

Employees are entitled to take the 16 national public holidays off as paid time off or receive compensatory days off if they’re required to work.

Sick
leave

Employees are entitled to sickness benefits starting from the fourth day of an illness, paid by Chilean health insurance authorities— provided a medical certificate stating the employee’s condition is stated.

Maternity
leave

Female employees can take 30 weeks of paid maternity leave, starting six weeks before birth and lasting 24 weeks after, paid by the health insurance agency.

Likewise, mothers of children under 18 are entitled to 10 days of leave, in addition to the statutory annual and public holiday entitlements.

Nursing mothers can take an hour-long break to breastfeed a child below the age of two.

Paternity
leave

Fathers can take five days off after delivery and can as well share the mother’s maternity leave of up to six weeks, or 12 half-weeks, paid at 100% of the employee’s normal salary.

Other
leave
  • Carer’s leave: Parents are entitled to paid leave off work to cater to an ailing child under the age of one.
  • Adoption leave: Adoptive parents can enjoy the same leave entitlements as natural parents. If the adopted child is over six months old, the maternity leave entitlement is limited to the six weeks pre-natal leave.
  • Medical Leave of Absence: in case an employee is declared unable to perform their duties by a certified physician, the employee will be subject to a leave of absence for the number of days suggested by the doctor. In general terms, the employer does not pay the employee’s remuneration during this leave (it’s covered by a subsidy paid by the Isapre national healthcare institution).
07

Employment
termination

Termination process

Employees can be terminated with just cause, for reasons such as dishonesty, negligence, fraud, or any other work-related offenses, and although the managerial staff can be dismissed at will, a severance package is mandated by law.

Notice period

An employer must provide at least 30 days’ notice of an employee’s termination.

Severance pay

Employees dismissed for business reasons (e.g., redundancy) are entitled to a severance package equivalent to a month’s wages, while employees guilty of violating their contract or other serious offenses won’t be entitled to severance pay.

Probation periods

Probation periods are not specified under Chilean law but can be agreed upon in a contract.

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