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Employment Termination in Nicaragua

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Termination process

Any decision to dismiss an employee must be approved by the Nicaraguan labour inspection authorities & the worker in question must be paid any accrued holiday and annual bonuses.

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Notice period

Workers should be notified 15 days in advance before they’re dismissed.

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Severance pay

Employees who’re dismissed without just cause are entitled to severance benefits calculated as one month’s pay for the first three years, plus 20 days wages for each following year.

Under Nicaraguan law, severance payments are capped at five months’ wages.

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Probation periods

Nicaraguan law limits probations to 30 days and either party can end the employment agreement without notice.