Panama Labor Laws
Understanding Panama’s labor laws is crucial for any business or investor looking to operate in the country. Panama has a comprehensive legal framework that governs employer-employee relationships, including labor rights, contracts, and workplace regulations. At Wolff & Bauer, we specialize in guiding businesses through Panama’s labor law requirements, ensuring compliance while protecting your business interests.
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About Us
Overview of Panama’s Labor Laws
Panama’s labor laws are designed to balance the rights and responsibilities of both employers and employees. These laws apply to both local and foreign workers and cover a wide range of issues such as employment contracts, wages, working hours, and social security contributions. Key areas to consider include:
Employment in Panama requires written contracts by law
Employers must pay minimum wage and a 13th-month bonus
The standard workweek in Panama is 48 hours with overtime
Employers must register staff with Panama's Social Security.
Employer Responsibilities and Workers’ Rights
Panama’s labor laws emphasize the protection of workers’ rights while ensuring that employers adhere to fair labor practices. All employees must be registered with Panama’s Social Security Fund, and employers are required to make contributions for healthcare, pensions, and other benefits. Employers must also maintain worker safety by ensuring a safe and healthy work environment, which includes compliance with occupational safety regulations and providing necessary safety equipment.
Termination of employment must follow legal procedures, and employees are entitled to severance pay if dismissed without just cause, with the amount varying based on the employee’s length of service and contract type. Companies in Panama may hire foreign workers; however, foreign employees must not exceed 10% of the total workforce. For technical specialists, this limit can increase to 15%. Work permits and visas are mandatory for all foreign workers.
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Personalized Support. Legal Expertise. Proven Success.
Immigration Experts You Can Trust
We specialize in guiding clients through Panama’s immigration processes, offering clear advice and personalized solutions for visas, residency, and citizenship programs.
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Whether you’re starting, buying, or expanding a business, we provide strategic guidance and practical support to help you succeed in Panama’s dynamic economy.
An Experienced Firm Committed to Your Success
With years of experience and a proven track record, Wolff & Bauer combines deep local knowledge with a client-focused approach to deliver exceptional results.
Employment Contracts and Compliance For Panama Labor Laws
Drafting and reviewing employment contracts to ensure compliance with labor laws.
Guidance on Wages, Benefits, and Conditions
Providing legal guidance on wages, benefits, and working conditions.
Employee Registration and Social Security Support
Advising on employee registration, social security contributions, and workers’ compensation.
Work Permits and Visas for Foreign Employees
Assisting with work permits and visas for foreign employees.
Why Wolff & Bauer?
Why Choose Wolff & Bauer To Help With Your Panama Labor Law Issues?
Navigating Panama’s labor laws can be complex, especially for foreign businesses or investors. At Wolff & Bauer, we provide expert legal advice to ensure your business remains compliant with Panama’s employment regulations.
Whether you’re starting a new business in Panama or expanding your operations, Wolff & Bauer can help you navigate the complexities of Panama’s labor laws, allowing you to focus on growing your business with confidence.
WHAT IS THE PROCESS?
Our 6-Step Process for Mastering Panama Labor Laws
From expert consultations to ongoing support, Wolff & Bauer is your trusted partner in Panama.
Comprehensive Consultation
We start by assessing your specific needs and answering your questions about Panama’s labor laws and compliance requirements.
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Tailored Labor Law Education
We provide easy-to-understand guidance on wages, benefits, contracts, and employee rights, customized to your business needs.
Employment Contract Review and Drafting
Our experts draft or review contracts to ensure they meet Panama's labor law standards, protecting your business and employees.
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Compliance Strategy Development
We create a personalized plan to help you adhere to wage, benefit, and working condition regulations with minimal hassle.
Support with Employee Registration
We assist with Social Security Fund registration, workers’ compensation requirements, and related legal obligations.
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Ongoing Legal and Compliance Support
Our team remains available to address your questions and ensure your business stays compliant as laws evolve.
How Can We Help You?
Frequently Asked Questions About Panama Labor Laws
From contract requirements and minimum wage regulations to employee benefits and compliance, our FAQ section provides clear and concise information to help your business stay on track.
What is the minimum wage in Panama?
The minimum wage in Panama varies depending on the industry and region. Employers must ensure they meet the legal wage requirements specific to their sector.
How many hours can employees legally work in Panama?
The standard workweek in Panama is 48 hours, spread over six days. Any hours worked beyond this limit are considered overtime and must be compensated at a higher rate.
What are the rules for terminating an employee in Panama?
Employers must follow specific procedures when terminating an employee. Employees dismissed without just cause are entitled to severance pay, which is calculated based on the duration of their employment and contract type.
Can foreign workers be hired in Panama?
Yes, foreign workers can be hired, but the number of foreign employees must not exceed 10% of the total workforce. For technical specialists, this percentage can go up to 15%. Work permits are required for foreign employees.
Are employers required to provide social security benefits?
Yes, all employers in Panama must register their employees with the Social Security Fund (CSS) and make contributions toward healthcare, pensions, and other benefits.
Yes, employees are entitled to 30 days of paid leave after completing 11 months of continuous work. They are also entitled to paid national holidays.
Yes, Panama’s tax free zones offer relaxed immigration policies, which may make it easier for foreign employees and investors to obtain residency or special visas.
Panama’s labor laws provide a balanced framework for employers and employees. Contact Wolff & Bauer for expert legal advice on ensuring your business remains compliant with Panama’s employment regulations.
DONT WAIT
Ready to Navigate Panama Labor Laws with Confidence?
Let Wolff & Bauer guide you through the complexities of Panama labor laws with expert advice and tailored solutions. Whether you need help drafting contracts, understanding compliance, or managing employee registrations, our team is here to support your success.
Contact us today to ensure your business operates smoothly and stays compliant in Panama.