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Employer of Record Chile
Hire staff and expand your business in Chile with our fully-managed EOR Service
How we can help
Unrivalled Employer of Record Service in Chile designed to expand your business seamlessly
Agility EOR delivers services for business’s looking for an Employer of Record in Chile. We help clients hire new employees or transfer existing employees into a fully-managed EOR service.
We appreciate that each situation and business is different. That is why our personal approach to Employer of Record Services in Chile takes care of all HR, payroll, recruitment and compliance head aches, and allows you to do what you love best – driving your business forward.
Employer of Record in Chile
A Brief Guide to Chile
Chile, recognized for its diverse landscapes, vibrant culture, and bustling metropolises, truly has something for everyone. From the dry Atacama Desert in the north to the icy glaciers of Patagonia in the south, and everything in between, this country is a blend of natural beauty and urban sophistication. Chile operates under a presidential republic, a member of various international platforms like the United Nations and the Organisation for Economic Co-operation and Development (OECD).
Category | Information |
Geographical Position | South America |
Capital City | Santiago |
National Language | Spanish |
Land Size | 756,102 square kilometers |
Population | Around 19 million |
Currency | Chilean Peso (CLP) |
Major Cities | Santiago, Valparaíso, Concepción, La Serena |
GDP (2023) | $500 billion USD |
Major Industries | Mining, agriculture, manufacturing, services |
Business Culture
Business Culture in Chile
When it comes to business interactions in Chile, a comfortable, yet professional atmosphere is appreciated. Building relationships is key, and it’s usual to chat about personal topics before diving into business matters. Chileans appreciate respectfulness and while being on time matters, a slight delay is generally tolerated. Business cards are typically exchanged at meetings and a solid handshake is the usual way to greet each other.
Payroll and Taxes
Payroll and Taxes in Chile
Collective agreements provide for the payment by employers of a fixed Christmas bonus payable in December and a Holiday bonus payable from 1 May to 15 August.
Employee Taxation
In Chile, income tax rates are progressive, with higher income levels subject to higher tax rates. Taxes are calculated based on the Monthly Taxable Unit (MTU), the value of which is adjusted in line with inflation. The current MTU is approximately equivalent to $70 USD.
Gross Annual Income (MTU) | Approx equivalent (USD) | Tax Rate (%) |
0 – 13.5 | $0 – $945 | 0% |
13.5 – 30 | $945 – $2,100 | 4% |
30 – 50 | $2,100 – $3,500 | 8% |
50 – 70 | $3,500 – $4,900 | 13.5% |
70 – 90 | $4,900 – $6,300 | 23% |
90 – 120 | $6,300 – $8,400 | 30.4% |
120 – 310 | $8,400 – $21,700 | 35% |
310 + | $21,700 + | 40% |
Employer Taxation
Employers in Chile are also responsible for various employer costs, which may include:
Cost Type | Percentage |
Unemployment Insurance | 2.4% |
Occupational Accident Insurance | 0.93% |
Disability Insurance | 1.99% |
Risk related contributions (dependent on the industry and nature of the employee’s work related activities) | 0 – 3.4% |
Pension and Healthcare
Chile Pensions
The retirement system in Chile is managed by private pension fund administrators (AFP), with contributions made by both employees (10% of taxable income) and employers (depending on the salary).
Healthcare in Chile
Chile’s healthcare system offers a broad array of services, including primary care, hospital services, emergency care, and maternal care. Funding comes from tax contributions and social security contributions.
Employment Law
Employment Law in Chile
Relevant Legislation: The Chilean Labor Code (Código del Trabajo) primarily governs the labour and employment sector in Chile. The Labor Code includes clauses about work contracts, work hours, time off, overtime, and job termination, among others.
Employment Contracts: As per the Labor Code, work contracts should be penned down, listing essential aspects like job terms, work hours, pay scale, and conditions for job termination. While not every job requires a formal contract, it’s typically standard for professional and permanent roles.
Working Hours: The typical work week in Chile spans 45 hours, generally distributed over six days. For the majority of jobs, the maximum daily work hours shouldn’t go beyond nine hours, with certain exceptions like mining industries.
Overtime: Any work done over and above the normal 45 hours weekly is classified as overtime. Overtime pay should be at least 1.5 times the regular wage for the first two hours and 2 times the regular wage for any additional hours.
Leave: Employees in Chile have the right to various kinds of leave. These include annual leave (beginning from 15 days after one year of uninterrupted employment), maternity leave of 18 weeks (with a minimum of 180 days of employment in the previous year), and sick leave. Chile also offers paid paternity leave of 5 days. Some firms may offer additional benefits.
Termination: The notice period before ending a work contract is determined by the duration of service. For employees who have served for less than one year, one month’s notice is required; for one year or more, two months’ notice is required. If an employee is dismissed for reasons like poor performance or misconduct, it should be justifiable, or else it could result in legal consequences.
Severance Pay: If an employee is terminated without a valid reason, they may be eligible for a severance package, depending on their tenure. For those with at least one year of uninterrupted service, the employer is obligated to provide severance.
IMMIGRATION
Work Permits in Chile
The Department of Immigration and Migration in Chile oversees the country’s immigration system. The country offers various visa categories, tailored to individual needs such as employment, education, or family reunification. Some examples include:
Work Visa: Non-citizens hoping to work in Chile need a work visa. This involves a confirmed job offer from a Chilean employer who will handle the necessary paperwork, including filing an employment contract with the immigration authorities.
Permanent Residence Visa: After a period of continuous legal residency, individuals can apply for permanent residence. They must provide proof of financial stability, either through employment, pension funds, or other financial resources.
Family Reunification Visa: Foreign nationals with immediate family members (spouse, minor children, or parents) who are Chilean residents or citizens can apply for this visa. The Chilean family member must provide proof of their relationship and their ability to support the applicant.
Student Visa: International students accepted into a Chilean educational institution can apply for a student visa. The duration of the visa usually aligns with the length of the study program. Student visas don’t automatically grant the holder permission to work in Chile, but part-time work permissions can be requested.
Public Holidays
Chile Public Holidays
Holiday Name | Date |
New Year’s Day | 1st January |
Good Friday | Varies |
Labour Day | 1st May |
National Holidays | 18th-19th September |
Reformation Day | 31st October |
Immaculate Conception | 8th December |
Christmas Day | 25th December |
Chile has additional public holidays that can change each year, such as Easter Monday, among others.
Wondering if expanding
in Chile is right for you?
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The Benefits
Chile Employer of Record Benefits
When you choose Agility EOR to expand in Chile, we guarantee an Employer of Record Service tailored to the needs of your business
Compliance
We are on top of regulatory changes in Chile so you can relax.
Cost reduction
Allow our economies of scale to work in your favour.
High Service Levels
You and your employees have a dedicated account manager.
Fixed Cost Pricing
We will agree our professional fees up front based on your needs - no nasty surprises!
Consolidated Invoicing & Payments
Make one monthly payment to cover all your tax, social and wages costs from one to one thousand employees.
Fast delivery
You can have 'boots on the ground' within days on our infrastructure.
Reduced Risk
All wage taxes are remitted in full to the Chilean authorities by professionals ensuring liabilities are met, giving you peace of mind.
Supply Chain Transparency
We only pay employees through local full employed solutions meaning Chilean payroll tax is paid on all funds.
Save Time and Money
Our expertise is at your disposal. The need for you to have internal HR, Payroll and admin staff is eliminated.