RICO’s Digest – For North Americans, the concept of a mandatory Christmas bonus is foreign to them. In Costa Rica, the “aguinaldo”, waht the Christmas bonus, is its mandatory. That is, every salaried employee in the private and public sector is entitled to receive it.
In turn, every employer, be it the government, the big corporation or the corner shop, is obliged to pay it. And pay it in full before December 20 or face sanctions.
The Aguinaldo in Costa Rica, for simplicity’s sake, is equal to one month’s salary received for the past 12 months between December and November. That is, if an employee has received one million colones a month in salary, without any additional remuneration such as bonuses or pay for extra hours, they are entitled to a payment of one million colones on or before December 20, in addition to their regular salary for the month.
This payment is obligatory to even the individual who hires a housekeeper, handyman or gardener, for example, that may even be seen as an employee. But in the eyes of the law, they are, and as such, they are entitled to the Aguinaldo. Even if they work for only a few hours a week or month.
While businesses and government keep records of expenses such as salaries and bonuses, you and I employing a housekeeper of a caretaker most likely don’t. So, unless this person is on a fixed monthly salary, come December it can be a time consuming task of figuring out the Aguinaldo.
Then, there are those who, as I have heard often, I pay my maid or gardener well, give them coffee in the morning, lunch and even a snack, but then skimp on the Aguinaldo, which in the eyes of the employee and the Labor laws of Costa Rica, makes them a bad employer.
On that, while you may have to spend some time to figure out what you paid out in salaries during the past 12 months, the easiest is probably to ask your employee (maid, housekeeper, gardner, etc) what you paid them. I can bet donuts to dollars they have it all recorded. And their Aguinaldo figured out.
Once you have the tally of all payments, divide by 12 and that is the Aguinaldo, which I said before, the “pay by” date is December 20.
What happens if you don’t or refuse to pay?
The answer depends on the employee. Most likely they will ask for it and if you decide not to pay or refuse to pay, their right is to approach the Ministry of Labor for an “official” calculation that then can be used to file a formal complaint.
The sanction for failing or refusing to pay is between 7 and 23 basic salaries. That is, if for argument’s sake you paid your maid an average of ¢100,000 colones a month, the fine is between ¢700,000 and ¢2,300,000 colones.
What is your maid or gardener is illegal in the country?
By law, you cannot hire illegals, that is a person without legal residency in the country, that includes a person without a cedula (national ID) or a DIMEX, the immigration card stating residency and permit to work.
This does not mean you shouldn’t pay the Aguinaldo or think that you would get away with it because they’re illegal, you might, but it will most likely come back to bite you in the tuchus, in one way or another.
And firing your employee before December won’t matter because, as stated before, the employee is entitled. In fact, the Aguinaldo is included in the “liquidación” (payment settlement) when an employee is fired or quits at any time.