Chile is a South American country that borders the South Pacific Ocean, and is located between Argentina and Peru. Chile has a market-oriented economy with high levels of foreign trade, boosted by the country’s strong sovereignty and sound policies. Chile’s economy relies agriculture, industries, and numerous natural resources such as copper that have resulted in strong economic success recently.
Chile’s population, comprised of whites, the non-indigenous and the Mapuche, all enjoy high living standards in one of South America’s most economically prosperous and socially stable nations. Most Chileans speak Spanish and are Roman Catholics by faith. The country’s culture is influenced by a mix of both Spanish and Mapuche traditions.
As one of the longest north-south countries in the world, Chile’s climate is varied with the world’s driest desert, the Atacama, to its north, a Mediterranean climate in its center, a humid sub-tropical one on Easter Island, to alpine and tundra regions in the east and south.
Employees hired for an indefinite term are regarded as permanent employees. In case of fixed-term contracts, if an employee has continued working after contract expiration without renewal, he/she is considered to have been hired for an indefinite time. In addition, an employee who has provided discontinuous services by virtue of more than 2 term contracts, for 12 months or more in a period of 15 months, counted from the first contract, will be legally presumed to have been hired for an indefinite duration.
A written employment contract is mandatory, and must include several details such as identity of parties, job particulars, holidays, remuneration, etc. Employment contract must be concluded in writing within 15 days of joining.
A temporary employment contract can be concluded, only for certain cases, such as leave substitution, special events, expansion of facilities, etc.
An employer (user) can hire temporary workers from temporary services agencies by concluding a written contract. This contract must include the rights and duties of hired employees, along with reasons for hiring temporary workers, jobs for which they are hired, their duration and agreed fee.
The duration of the probationary period in Chile without prior agreement is 2 weeks by default. During this time, either party to the employment contract may terminate the relationship with 3 days' notice.
Per Chilean labor law, the standard workweek is 42 hours from April 26, 2026, and the ordinary workday cannot exceed 10 hours. This is a transitional period, and in 2028, the workweek will decrease to 40 hours. Employees working longer are eligible for overtime. The maximum weekly hours cannot be distributed in more than 6 or fewer than 4 days.
Overtime work can be required in extraordinary situations to avoid damage in the ordinary course of work, to prevent accidents, or to make urgent repairs to machinery.
Employees and employers are required to include the modalities of remote work in their employment contracts. All remote work contracts must be registered with the Labor Department within 15 days. Remote work is subject to the regulations related to general working hours.
The Labor Code of Chile entitles employees to an annual leave of 15 working days with full salary after a full year of service with their employer. The leave time adds up to 21 consecutive days (including weekends) or a total of three weeks. Fixed-term employees who provide continuous services to the same employer by virtue of 2 or more contracts that exceed one year are also entitled to the same annual leave.
Employees with over ten years of experience receive one extra day of annual leave for every three years of service beyond ten years. The annual leave can be broken into segments, with one of the parts being at least ten days. If an employee has two consecutive periods of vacations lined up, the employer must instruct the employee to take a minimum of 15 days off from work before the end of the year.
The Chilean Labor Code establishes that, in the event of an employee's illness, the employer must immediately notify the relevant social security agency and maintain the employee’s position for a specified period, without entitlement to remuneration, depending on the employee’s length of service with the company – 8 days for less than 6 months of work, and 15 days for less than 12 months, and 30 days for more than 12 months of work.
Employees are eligible to take sick leave after a medical professional (physician, surgeon, dental surgeon, or midwife) issues a medical certificate stating that the employee is temporarily unable to work. The certificate must be authorized by the relevant health institution. The employee must submit the certificate to their employer within 2 working days of starting the sick leave.
Employees are entitled to payment of the Subsidy for Work Disability (SIL), or remuneration, if they have been affiliated with a health insurance for at least 6 months and have paid at least 3 months of contributions within the 6 months prior to the start of the sick leave. SIL covers sick leave from the first day if it is more than 10 days, or from the fourth day if it is equal to or less than 10 days. The amount of benefit is equal to the average daily wage of the employee over the last 6 months. Employees cannot be dismissed during medical leave unless a legally established cause for termination exists.
The labor code of Chile entitles female employees to a maternity leave of 6 weeks before delivery and 12 weeks after delivery. The leave is extended, as prescribed by the doctor, in case of any complications during the pregnancy or childbirth. If the birth occurs before the 33rd week of gestation or if the birth weight is less than 1,500 grams, the leave after childbirth is extended to 18 weeks. For multiple births, the maternity leave is increased by 7 calendar days for each child born after the second one.
The benefits for this leave is paid by social insurance. To qualify for maternity benefits from social insurance or mandatory private insurance, employees must have at least 6 months of contributions, including at least 3 months of contributions in the last 6 months.
There is a maternal subsidy for women without a valid employment contract, paid by the Social Security Superintendence.
The Chilean Labor Code provides employees with paid paternity leave of 5 days, which can be used within the first month from the date of birth. The leave must be used continuously, excluding weekly rest days. The leave is to be paid by the employer. Employees who adopt a child are also entitled to paternity leave.
If the mother died during childbirth or during the period of maternity leave, the remaining leave and allowance is transferred to the father or to whomever custody of the minor was granted.
The Labor Code of Chile requires a notice period of 30 working days to an employee for dismissal due to business reasons. The notice must be in writing and clearly indicate the reason for dismissal. A copy is to be sent to the Labor Inspector. The notice period can be waived off by paying salary in lieu of notice.
The Chilean Labor Code entitles dismissed employees who have completed at least 1 year of service to severance pay equal to 30 days' salary for each year of work, limited to 330 days’ salary. Any partial year of work exceeding 6 months is counted as a full year. Employees with fixed-term contracts are also eligible for severance pay at the end of their contract, if the contract has been in effect for at least a month. The amount is 2.5 days' pay for each month worked and any fraction thereof exceeding 15 days.
Employees dismissed by their employer for business reasons or wrongful reasons are eligible for severance. Severance pay is not paid to those who are dismissed for gross misconduct or just cause.
