Labor Code in Bolivia
The labor code of Bolivia consists of lots of rules, some of which are fairly complicated. Hence, companies must consider professional legal advice and adapt to the regularly updated labor laws. Bolivia’s labor laws are overseen by their Ministry of Labor. Here are the latest changes to the labor code in Bolivia.
The National Minimum Wage has been raised to US $305 in 2020.
Companies must pay a total of thirteen salaries each year to their employees. This includes a Christmas bonus in December.
Working hours per day cannot exceed eight hours.
Every employee is, by law, allowed fifteen days of vacation during the year.
Prerequisites of a Labor Relationship in Bolivia
Labor contracts in Bolivia are mostly written or oral. Here are some of the prerequisites for a labor relationship in Bolivia:
- Provision of service according to a unique schedule
- Dependency and discipline
- Receiving compensation in the form of salary
If all these conditions apply, it may be designated as a labor relationship.
The indefinite labor contract is the most common contract type in Bolivia. All contracts, written or oral, are indefinite in Bolivia. According to such a contract, an employee enters a trial period of 90 days at the start of employment.
While employees can use this time to get to know the company and decide if they would fit in there, employers can also use the same time to terminate the contract without any compensation if the employee does not meet the company’s expectations.
Fixed Period Contract
According to Bolivian law, a fixed contract needs to be in written form and must clearly state the duration of the employment. This contract can be used in the following instances:
- Worked who have a fixed period contract are not allowed to undertake direct company activities. Instead, workers with this contract can only support activities that are not integral to the company.
- In case a permanent employee is unable to show up to work due to a family emergency or sickness, the company may employ a temporary employee under this contract for the time being. However, the same temporary employee cannot be employed more than once.Fixed-term workers can be hired if a company has extra workload and needs more workers to meet orders.
- Additional human resources needed for a longer period can only be hired using the indefinite labor contract.
- A fixed period contract only applies for a one-year duration.
- When employing someone using this contract, the Ministry of Labor needs to be informed.
Even though salaries can be mutually decided between the employer and employee, they cannot fall below the Bolivian minimum wage. In 2006, the minimum wage was adjusted, and terms were set for a compulsory minimum increase that employees must receive on the basis of the previous year’s payroll.
Below are the rules that apply to wages and salaries:
- Certain contributions and withholdings will be applied to all salaries
- Salaries need to be paid by the end of every month
- The Bolivian law does not make any method of payment mandatory
- This depends on the employee and can range between checks, cash, deposits, or wire transfers
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