Employer of Record Guide in 

Bolivia

Vacation Leave

• Standard Entitlement: 15 working days after one year of continuous service
• Increased Entitlement:
  • 20 days after 5 years
  • 30 days after 10 years
• Vacation Pay: Full salary during vacation period
• Payout Rules: Unused vacation must be paid out upon termination

Sick Leave

• Duration: Up to 26 weeks per year for the same illness
• Payment:
  • First 3 days: Employer pays 100%
  • Days 4-26: Social Security pays 75%
  • After 26 weeks: Disability pension may apply
• Medical Certification: Required after 3 consecutive days

Maternity Leave

• Duration: 90 days total (45 days before birth, 45 days after)
• Payment: 100% of salary paid by Social Security
• Job Protection: Position must be held open during leave
• Nursing Breaks: 1 hour daily for nursing mothers up to 1 year

Paternity Leave

Note: Research shows conflicting information (3 days vs 10 business days). Please verify current regulations as this may reflect recent 2024 law changes.

• Duration: 10 business days (recent legislation)
• Payment: 100% of salary
• Timing: Must be taken within 30 days of birth

Other Statutory Leave

• Bereavement: 3 days for immediate family members
• Marriage: 3 days for employee's wedding
• Study Leave: Time off for educational purposes (unpaid)
• Civic Duties: Time off for voting, jury duty, military service

Summary

Termination Types

Termination With Cause (Despido Justificado):

• No compensation required
• Must be based on serious misconduct defined in labour code
• Examples: theft, insubordination, abandonment of work

Termination Without Cause (Despido Injustificado):

• Requires payment of compensation
• Must follow proper procedures
• Employee may challenge termination

Notice Period Requirements

Bolivia does not require advance notice for termination. Instead, the system relies on compensation payments:

• Immediate termination is permitted
• Compensation replaces notice requirements
• Proper documentation must be provided

Severance Pay

Compensation Calculation:

• 1 month's salary for each year of service
• Proportional payment for partial years
• Minimum 3 months compensation regardless of tenure
• Maximum 12 months compensation cap

Additional Payments:

• Unused vacation days
• Prorated aguinaldo (Christmas bonus)
• Any outstanding salary or benefits

Probationary Periods

• Duration: Up to 90 days for most positions
• Specialized Roles: Up to 6 months for technical positions
• During Probation: Either party may terminate without compensation
• After Probation: Full labour protections apply

Final Pay Requirements

Employers must provide final settlement within 48 hours of termination, including:

• Final salary payment
• Compensation for termination
• Unused vacation pay
• Prorated bonuses

Anti-Discrimination & Retaliation Laws

Employees cannot be terminated for:

• Pregnancy or maternity leave
• Union activities or membership
• Filing labour complaints
• Race, gender, religion, or political beliefs

Violations can result in reinstatement orders and additional compensation.

National Public Holidays

Regional Holidays

Each department (state) may have additional local holidays:

• La Paz: July 16 (La Paz Day)
• Santa Cruz: September 24 (Santa Cruz Day)
• Cochabamba: September 14 (Cochabamba Day)

Holiday Pay Rules

• Working on Holidays: Double pay rate
• Holiday Falling on Weekend: Substitute day off provided
• Eligibility: All employees entitled regardless of tenure

Required Documents for Employment

Employment Contract:

• Must be in Spanish
• Include job description, salary, working hours
• Specify probationary period if applicable
• Define termination conditions

Government Registration:

• Tax ID (NIT): Required for all employees
• Social Security Registration: Mandatory within 30 days
• Labour Ministry Registration: Required for contract validation

Employee Documentation:

• National ID card (Cédula de Identidad)
• Birth certificate
• Educational certificates
• Previous employment certificates

Work Authorization

Bolivian Citizens:

• No additional authorization required
• Must provide valid national ID

Foreign Workers:

• Work visa required before employment
• Temporary residence permit
• Professional qualification recognition (if applicable)

Background Checks & References

• Criminal Background Check: Commonly requested
• Employment References: Standard practice
• Educational Verification: Required for professional positions
• Medical Examination: May be required for certain roles

Data Protection & Privacy

Bolivia has basic data protection requirements:

• Employee consent required for personal data collection
• Secure storage of employee information
• Limited sharing of personal data
• Right to access and correct personal information

Onboarding Timeline

What the EOR Handles

Borderless AI will handle:

• Spanish-language employment contracts
• Government registrations and compliance
• Social Security and tax registrations
• Payroll setup and processing
• Local labour law compliance
• Document collection and filing

Worker Classification: Employee vs Contractor

Bolivia has strict rules distinguishing employees from independent contractors:

Employees:

• Work under employer control and supervision
• Use employer-provided tools and equipment
• Receive regular salary and benefits
• Subject to disciplinary measures
• Covered by labour law protections

Independent Contractors:

• Provide services autonomously
• Use own tools and equipment
• Invoice for services rendered
• Not subject to employer discipline
• Not covered by labour protections

Note: Misclassification can result in significant penalties and retroactive payments of benefits and contributions.

Unionization & Collective Agreements

Bolivia has strong union traditions:

• Right to Organize: Protected by constitution
• Collective Bargaining: Common in larger companies
• Strike Rights: Legally protected with proper procedures
• Union Dues: May be automatically deducted from payroll

Cultural Norms & Workplace Expectations

Communication Style:

• Formal address (usted) is common in professional settings
• Personal relationships are important in business
• Punctuality expectations may be more flexible than North American standards

Work-Life Balance:

• Family obligations are highly respected
• Extended lunch breaks are common (1-2 hours)
• Religious observances are accommodated

Diversity & Inclusion:

• Indigenous languages (Quechua, Aymara) are official languages
• Cultural diversity is constitutionally protected
• Gender equality in workplace is legally mandated

Remote Work Considerations

Remote work regulations in Bolivia are still developing:

• Legal Framework: Limited specific remote work legislation
• Equipment: Employer typically provides necessary tools
• Working Hours: Standard labour laws still apply
• Taxation: Remote workers remain subject to Bolivian tax if resident

Cross-Border Considerations:

• Foreign companies employing Bolivian remote workers need local presence
• Tax obligations apply regardless of work location
• Social Security contributions required for Bolivian residents