HR Software for Chile

Leave Policy

Maternity Leave

Pregnant workers who have made social security contributions for six months are entitled to 126 days of paid leave, divided into two parts. 42 days must be taken before the birth of the child (pre-birth) and 84 days after birth (post-birth).

This leave is paid at 100% of the employee’s regular salary, up to a cap, and Social Security is responsible for this payment.

This leave can be extended through parental leave.

Paternity Leave

Employees are entitled to seven working days of paid paternity leave. The leave begins with the birth of the child and employees must provide the birth certificate. The employee receives 100% of his salary during this period and the employer is responsible for this compensation.

The employee cannot extend the vacation.

Parental Leave

Mothers who have taken maternity leave are entitled to further parental leave. You can choose one of the following options:

  • An additional 84 days of full-time vacation.
  • Another 144 days of half-day vacation. In this case, the employee only works half of the working day and spends the other half with the child.
  • Another 84 days shared with the child’s father. The employee must notify the employer at least 30 days before the end date indicated on the birth certificate.

No medical certificate is required for parental leave. The decision to take parental leave rests solely with the employee and cannot be influenced by the employer.

This leave is paid by the health system at 100% of the employee’s regular salary.

Sick Leave

Employees are entitled to unlimited paid sick leave.

The employer is not responsible for paying for sick days. Payments are made by the employee’s health insurance company (ISAPRE or FONASA). The Chilean health system requires six months of contributions before it subsidizes sick leave.

Sick leave is paid as follows:

  • 1-3 days: 0% of the salary is paid to the employee, the health insurance company only pays the employee’s social security contribution.
  • 4-10 days: The health insurance company pays the employee his normal salary and the employee’s social security contribution, with 3 days being deducted.
  • 11+ days: The health system pays the employee his normal salary and the employee’s social security contribution in full.

The employee’s salary is paid daily, calculated based on the average daily salary for the last 3 months, with a maximum of 86UF monthly.

The doctor submits the medical certificate through iMed, which issues a notice to the employer. The employer has 3 days to process this exemption electronically. If the document could not be submitted via iMed, the employee has 48 hours to submit the document to the employer.

Pay & Tax

Minimum Wage Requirements

The national minimum wage for full-time employees in Chile is CLP 440,000.

The law provides for gradual increases in 2023 and 2024 to raise the minimum wage to CLP 500,000. As part of this change, the minimum wage will increase to CLP 460,000 on September 1, 2023 and finally to CLP 500,000 on July 1, 2024.

Individual Income Tax

Individual income tax ranges from 0% to 40%. Income tax is calculated at progressive rates. An additional flat tax rate of 15% may apply to non-residents.

Gross Annual IncomeTax Rate (%)
Up to CLP 854,050.500%
CLP 854,050.51 to CLP 1,897,890.004%
CLP 1,897,890.01 to CLP 3,163,150.008%
CLP 3,163,150.01 to CLP 4,428,410.0013.5%
CLP 4,428,410.01 to CLP 5,693,670.0023%
CLP 5,693,670.01 to CLP 7,591,560.0030.4%
CLP 7,591,560.01 to CLP 19,611,530.0035.5%
Over CLP 19,611,530.0140%

Payroll Cost

Employer costs are generally estimated at 4.91% of employee salary.

  • Statutory profit sharing – CLP 182,092
  • Work from home allowance – CLP 32,000
  • Life insurance – 1.58%*
  • Workers’ compensation insurance – 0.93% up to a maximum salary for the contribution of CLP 2,941,704.48 including statutory profit sharing
  • Unemployment insurance – 2.4%**

*The maximum salary for life insurance calculation is CLP 2,941,704.48 including statutory profit sharing, and for unemployment insurance calculation is CLP 4,419,766.78 including statutory profit sharing

**up to a maximum salary for the contribution of CLP 4,419,766.78 (including statutory profit sharing)

Overtime Pay & Maximum Hours

The standard working hours are 9 hours per day and 45 hours per week. The normal working week lasts from Monday to Friday.

Termination

Termination Requirements

Dismissals must take into account complex rules and the regulations of the country in which an employee is employed. Off-boarding is always carried out by the employer with the main participants. It may include ad hoc fees as well as required or recommended steps for specific termination cases.

Layoffs in Chile can be complex. In Chile, an employer cannot terminate at will. Employers must justify terminations based on a company-related business need.

Compliant terminations are:

  • Voluntary by the employee
  • By mutual agreement
  • Unilaterally by the employer due to:
    1. Probation period
    2. Objective reasons
    3. Disciplinary dismissal
  • When the contract expires

After the contract period has expired, the employer must confirm to the employee in writing that the contract will not be extended for fixed-term contracts.

Notice Period

The minimum notice period is 30 days. The employer can also pay severance pay.

Severance for Employees

In Chile, all employees who are dismissed for general reasons or without notice are entitled to severance pay. The severance payment is 30 days of salary per year of service up to 330 days.

The monthly severance payment cannot exceed a maximum of 90 UF (US$3,500) unless the employee is dismissed without notice.

Statutory Time Off

Paid Time Off

Both full-time and part-time employees are entitled to 15 workdays of paid time off (PTO) per year. The PTO entitlement grows monthly by 1.25 days per month. Employees are entitled to annual leave, which is accrued by mutual agreement between the employer and the employee

Public Holidays

In Chile there are 15-16 national and 3 regional holidays, depending on the employee’s location.

National holidays in 2022 include:

  • New Year celebration
  • Easter Friday
  • Easter Sunday
  • Labor Day
  • Naval Glory Day
  • National Day of the Indigenous Peoples in Chile
  • Feasts of Saints Peter and Paul
  • The Feast of Our Lady of Mount Carmel
  • Assumption Day
  • Independence Day
  • Army Glory Day
  • Race Day (Discovery of Two Worlds)
  • Reformation Day
  • All Saints Day (All Saints Day)
  • Feast of the Immaculate Conception
  • Christmas Day

Onboarding

Onboarding

Onboarding takes 3 working days after the customer signs the SOW.

Additional Info

Employment Contract Details

The contracts must be written in Spanish and can be bilingual. They must be in writing and signed by both parties. A contract must contain:

  • Surname
  • Start date
  • Length of employment
  • Job description
  • Conditions for remote work
  • Conditions for the right to disconnect
  • Conditions for Termination

Probation Period

There is no probationary period in Chile.