The complete guide to offering employee benefits in Costa Rica

When hiring employees in Costa Rica, benefits are a crucial piece of the puzzle. You want to offer employees a benefits package that's attractive to them and meets their needs—and, most importantly, it needs to meet the minimum requirements for mandatory employee benefits in Costa Rica. Running afoul of labor laws by failing to offer statutory benefits could mean government penalties and fines, the risk of costly legal action, and more.

Here's everything you need to know to offer a benefits plan that meets statutory requirements under Costa Rican labor laws—and how to go above and beyond for your employees in Costa Rica.

What employee benefits are mandatory in Costa Rica?

Mandatory benefits programs are required by Costa Rican law. Below, you'll find an overview of all the benefits that employers must provide to stay compliant with labor laws in Costa Rica.

It's always important to keep in mind, though, that the benefits required by the government of Costa Rica are statutory minimums. Employers can always offer more than the mandatory benefits—and many do, to attract and retain the best employees. Also, note that these benefits are mandatory for employees—independent contractors in Costa Rica aren't entitled to any benefits.

Social security

All Costa Rican employers are required to contribute to social security, known as Caja Costarricense de Seguro Social, CCSS, or just Caja, for all of their employees. The typical employer contribution is 26.67% of the employee's salary.

Social security in Costa Rica covers national healthcare, parental leave, pension, disability, and employment insurance.

Unlike in many countries, many statutory benefits are split between employers and social security. For example, paid sick leave is a mandatory benefit for all employees in Costa Rica, but instead of paying a sick employee's full salary, employers share that cost with the social security system (more on that below).

Worker's compensation

Employers are also required to pay into labor risk insurance (seguro de riesgos del trabajo) for all their employees. This is the equivalent of worker's compensation insurance, meant to cover employees in case of work-related accidents or injuries. Employers pay into the Instituto Nacional de Seguros (INS), which handles labor risk insurance claims and payouts.

Overtime pay

The standard work week in Costa Rica is 48 hours at eight hours per day. Any work over 48 hours in one week is considered overtime. Employees can work overtime, but no more than four hours per day (for a total of 12 hours of work per day).

Under Costa Rican labor laws, overtime is paid at 150% of the employee's regular wages. If they're working overtime on holidays or their weekly rest days, they're paid 300% of their regular wages.

Notice periods and severance pay

Notice periods and severance pay both have minimum statutory requirements based on the length of the employee's service.

The legally required notice periods are below:

Minimum severance pay amounts are below:

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