does anyone have the link or written document to the "alleged" new labor law that states even those workers who work only 1 or 2 days a week must be signed up for Social Security?
We were out of town when the talk on this topic was held at the BCP.
thanks
Replies
Susan & Pat
The labor law is mostly pro-worker. This has to do with bad practices commited in Panama in the past by employers that abused and over abused their workers. In 1972 the Military Government ruled by General Torrijos created our Codigo de Trabajo or Labor Code as a way to protect workers from bad employers. So in case of doubts the law will favor the employee.
If you have a person doing a work for you on a weekly basis I would recommend you to write a Profesional Services Contract with that person and that this person give you and invoice every time you pay them for their services.
You are welcome! Miss you guys too.
Hello there,
The claim is usually made because there is no contract in place so they take the word of the worker. The labor dept. rep told me that without a contract in place or having the worker registered with the SS office the employer appears to be trying to take advantage of the worker and the system. The contract I shared is basically a contract for services and in exchange you pay the fee agreed upon. This makes the person you hire self employed, therefore, they are responsible to pay taxes on their income and you are not liable for injuries specially if you are specific about their duties in the contract.
Out of the goodness of your heart you may assist with the medical bills. What also is appreciated with the contracts is that 3 times a year, around the time other workers get DECIMO, you also give them an extra $10. This is usually done on April, August, and December. Get receipts.
All this will show the labor department that you were a good employer.
Just an example here: (names will be omitted to protect the parties involved)
An expat had a worker that did a decent job for a while but the worker started slacking off and becoming abusive towards the employer.The expat wrote up the contract had it signed by the worker and fired the worker after that days work and pay.
No consequences. She had a signed doc.
There are no guarantees that they may not try to take you to the labor dept. but you will have a defense against the claim and most likely win.
If you have any questions call Daisy Ruiz 6675-7019.
Daisy is a certified accountant that handles payroll accounts for many expat business owners. She is up to date with all the labor laws and would be able to advise you best. She is bilingual.
thank you for clarifying why the contract benefits the employer.
miss you, Nancy
Hello guys, you can protect yourselves by having your 1 day employee sign the following contract.
I attached both the Spanish and English version.
Also, keep receipts of all payments and bonus.
Have a copy of their ID if available.
Some folks have shared that they were able to beat a false claim against them from a cleaning lady filed with the labor department.
Nancy.
That is what I was talking about to other people here at Ning. Have a contract for professional services.
Nancy, I have a cleaning lady who works for me 2 half-days/month. Should I change the 3 months in the contract to the number of years she has been working for me? I have no time limit for her. Can I say "indefinite" for the time? I don't want to create problems by having this contract.
You sure can Judy.
I know better than to open up Ning's Box, but I am in a stupid mood, so I will do so anyway.
I live in a place where there are lots of day workers who leave or get fired regularly. I know for a fact that they work at minimum wage without benefits. Their direct employers are Panamanian. If these new labor laws mean anything to these employers, it is not evident, and I suspect it is because Panamanian employers are far more adept at dealing with Panamanian law that most gringos will ever be.
We have decided that it will be a much smaller headache to pay the cost premiums and get our day employees for home services through a Panamanian agency. I suspect that may be the root objective of the law, even if it means nothing for the people who are actually doing the work.
If you live where I think you do, the development's labor practices, though clever, are despicable. They hire employees and then let them go before the probationary period has elapsed. There is constant turnover so the employer isn't obligated to pay benefits.The employees have no medical or disability coverage, not to mention credit toward retirement benefits. This is worker exploitation, and it's morally reprehensible whether practiced by Panamanians or expats.
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