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Paying employees

Employees who perform manual work are paid weekly (Federal Labour Law, Art 283). Other employees are usually paid every 15 days. Monthly payments are also possible depending on agreed terms of the contract.

It is common practice to pay an employee who is paid monthly, a proportional advance payment between the 10th and 15th of the month. Advances are paid as gross amounts only, no deductions and taxes are taken. The advance will be deducted from their next payroll cycle. It is a common practice across Latin America and is a legal requirement in some countries to provide advance payments for vacation leave. Advances are paid as regular direct deposits into the employees' bank accounts.

Underpayment of salary by error must be immediately corrected (ie the employer cannot wait for the next pay run).

Employers can withhold amounts to make up for past overpayments. However, this is a labour risk because the employee can file a complaint and the employer can be penalised. Employers should have the employee sign a repayment agreement for collection of erroneous