HR Software for Peru

Leave Policy

Maternity Leave

Employees who have worked 90 consecutive days are entitled to 98 days of paid vacation. 49 days must be taken before the birth of the child. The employee receives his full salary during this period and the public health insurance company (Essalud) is responsible for payment.

In special cases, the employee can extend the vacation by a further 30 days with a certificate from the doctor/midwife.

Paternity Leave

Employees are entitled to 10 working days of paid paternity leave, which must begin on the day of the child’s birth. The employee receives 100% of his salary during this period and the employer is responsible for this compensation.

The employee can extend the vacation in certain cases with the approval of the doctor.

Parental Leave

Parental leave is not regulated by law in Peru. However, employees may be entitled to maternity and paternity leave.

Sick Leave

Employees are entitled to up to 20 days of paid sick leave, paid by the employer. After this period, if the illness continues, the employee will be insured by the health insurance company (Essalud) and will receive his full salary for up to one year.

Pay & Tax

Minimum Wage Requirements

The minimum wage is 930 PEN per month.

Individual Income Tax

Individual income tax is between 8% and 30%. Income tax is calculated at progressive rates. Several additional factors can affect overall rates, such as: the household status and the number of children.

In Peru, the income tax rate is calculated on a unit basis. Each taxation unit corresponds to an annual income tax of PEN 4,400.

Tax Unit (UIT)Tax Rate (%)
Up to 5 UIT8%
Up to 20 UIT14%
Up to 35 UIT17%
Up to 45 UIT20%
Over 45 UIT30%

Payroll Cost

The cost to the employer is generally estimated at 13% of the employee’s salary.
Monthly charges

  • Statutory health insurance – 9%
  • Workers’ compensation insurance – 4%
  • Telework allowance – 115 PEN

Note: If the employee is entitled to the family bonus (102.50 PEN), the monthly costs are calculated based on the sum of the employee’s salary and the family bonus.
Annual and semi-annual costs

  • Compensation for length of service – 8.56% (twice a year)
  • 13th month salary – 1 month basic salary 14th month salary – 1 month basic salary Profit sharing – approximately 190 PEN for 2023, but changes every financial year

Overtime Pay & Maximum Hours

Overtime pay is mandatory for employees whose working hours are specified in the employment contract. Hours that go beyond normal working hours are considered overtime. Employees receive compensation for additional hours:

  • 125% of the hourly rate for the first two hours
  • 135% of the hourly rate for the following hours

Employees in management positions may be excluded from overtime pay.

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.

Terminations in Peru can be complex. In Peru, employers cannot terminate at their own discretion [outside of the probationary period] and termination must be for just cause. 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
    4. By expiry of the contract

Notice Period

The standard notice period is 30 days and depends on the reason for termination.

Severance for Employees

In Peru, workers who are dismissed due to arbitrary – unjustified – dismissal are entitled to severance pay. The severance payment is 45 days per year of service up to 12 months’ salary.

To protect you from unforeseen financial risks due to dismissals, IceHrm applies a severance pay provision in all employment contracts in this country. IceHrm has extensive expertise in managing litigation risk globally and our severance provision calculation is based on prevailing common law or statutory requirements and best local practices. If your employee resigns or is not entitled to severance pay, you will receive a refund of any unused amounts.

Statutory Time Off

Paid Time Off

Both full-time employees are entitled to 30 calendar days of paid vacation per year. PTO is credited monthly at 2.5 days per month. Employees are entitled to annual leave after 12 months of work.

Part-time employees are entitled to six calendar days of paid vacation per year.

Public Holidays

In Peru there are 10 national holidays as well as several regional holidays, which depend on the employee’s place of residence.

National holidays include:

  • Good Friday
  • Labor Day
  • Saint Peter and Saint Paul Day
  • National Holidays
  • Santa Rosa de Lima
  • Battle of Angamos
  • All Saints’ Day
  • Day of the Immaculate Conception
  • Battle of Ayacucho- Non-working day public sector
  • Christmas Day

Onboarding

Onboarding

Onboarding takes three working days.

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 descrption
  • Conditions for Termination

Backdating the contract is not permitted.

Probation Period

Probationary periods are not mandatory. The minimum probationary period is 30 days and the maximum probationary period is 90 days (three months). Depending on the employee’s position, the probationary period can be extended by 180 days to one year if both parties agree in advance.