Are you a US or Canadian employer looking to hire talent in Chile? If so, you may want to consider working with an Employer of Record (EOR) to make the process easier and more efficient.
Let’s discuss the advantages of hiring an employee in Chile through an EOR, the legal requirements, the contracts and documentation, employee insurance and benefits, vacation and public holidays, taxes, and your responsibilities.
Why Hire Talent in Chile?
When it comes to hiring, Chile is an attractive option for employers in the US and Canada. With a highly educated workforce, ideal time zone, and competitive labor costs, recruiting Chilean employees offers a viable alternative to traditional hiring practices.
The country has experienced strong economic growth over the past decade, and its investment-friendly policies make it an ideal destination for businesses looking to outsource or hire employees remotely. In addition, the Chilean government has established an Expatriate Orientation Program (EOR) that enables organizations from other parts of the world to recruit qualified personnel from Chile without having to go through a lengthy visa process.
Another major advantage of hiring talent in Chile is its abundant pool of bilingual professionals. While Spanish is the official language of the country, English is widely spoken, especially among professionals. This makes it easy for foreign companies to communicate effectively with their employees in their native language while also providing them with access to a well-educated labor pool that can help grow their business.
Chile's robust educational system also means that employers can find skilled workers in a variety of fields, including engineering, finance, IT, healthcare and more. As such, businesses in the US and Canada can take advantage of these resources when they seek out new talent outside their own countries’ boundaries.
Chile boasts a relatively low cost of living compared to other countries like the United States or Canada, meaning employers can benefit from lower salaries while still being able to attract highly qualified personnel who will add value to their organization.
How Can I Legally Hire an Employee in Chile?
Hiring an employee in Chile is different from hiring within the US or Canada. It requires more planning and research to ensure all laws are followed and the process is handled legally. An EOR can be beneficial for those looking to hire an employee from Chile as they are able to handle the complexities of managing payroll, taxes, employment contracts, and other compliance tasks.
In order to legally hire an employee from Chile there are certain steps one must take. Firstly, employers must obtain permission from the Chilean government before recruiting any foreign workers unless they recruit via an EOR. This will depend on the type of job being offered by the employer as some jobs are restricted to local workers only.
Once permission is granted, employers should research Chilean labor laws and create employment contracts which adhere to these regulations. It’s also important for companies to understand their obligations when it comes to wages, working hours and benefits, like vacation, types of leave, and health insurance.
What Does an EOR Do?
By using an EOR, companies can significantly reduce the paperwork of hiring new employees from abroad. An EOR provides an efficient and compliant solution for companies looking to employ staff in Chile. It helps businesses manage the complexity of local labor laws, as well as handle all the associated administration. Specifically, an EOR can help employers with contracts, insurance, benefits, paid time off, and taxes.
Contracts and Documentation
An EOR will provide employers with compliant contracts and any other necessary documents to make sure they are in compliance with Chilean labor laws. This includes employment agreements, non-compete clauses, and confidentiality agreements. They also offer support throughout the duration of a contract if necessary.
Employee Insurance and Benefits
An EOR will advise on employee insurance and benefits required by Chilean law, such as social security contributions and health insurance coverage. By using an EOR service, businesses can ensure that their employees are adequately protected in case of illness or injury while working for them.
Vacation and Public Holidays
The EOR will help employers understand their obligations when it comes to providing vacation time as well as complying with public holidays specific to Chile. They will also be able to advise on how these days should be handled from a payroll perspective. Here is a compact list of public holidays in Chile:
- January 1: New Year's Day (Año Nuevo)
- May 1: Labor Day (Día del Trabajo)
- May 21: Navy Day (Día de las Glorias Navales)
- June 26: St. Peter and Paul (San Pedro y San Pablo)
- July 16: Virgo Carmen (Día de la Virgen del Carmen)
- August 15: Assumption Day
- September 18: Fiestas Patrias (Independencia Nacional)
- September 19: Army Day (Día de las Glorias del Ejército)
- October 9: Discovery of America (Día del Descubrimiento de Dos Mundos)
- October 27: Reformation's Day
- November 1: All Saints' Day
- December 8: Immaculate Conception (Inmaculada Concepción)
- December 25: Christmas
Taxes
The EOR is responsible for ensuring compliance with local tax laws when it comes to withholding taxes from employees' salaries as well as filing reports required by the government on behalf of employers. This includes preparing annual tax returns so that companies can remain fully compliant with Chilean regulations at all times.
What are the Advantages of Going through an EOR in Chile?
By using an EOR, US and Canadian companies can outsource many of the administrative tasks involved in employing staff in Chile, allowing them to focus on finding qualified talent for their company instead.
An EOR will provide guidance throughout the recruitment process and help businesses navigate local laws. This guarantees all aspects of hiring an employee in Chile comply with local regulations and provide a safe workplace environment for employees. Additionally, outsourcing payroll services such as salaries and tax payments through an EOR service can help prevent any potential financial liability issues that may arise due to incorrect withholding or late payments of wages or taxes.
Using an EOR helps companies protect themselves against potential legal action if they fail to meet local labor laws or obligations. The EOR should ensure that all necessary documents are filed correctly and that employees receive the wages and benefits required by Chilean law. With everything taken care of by a professional service provider, employers can rest assured that they are compliant with Chilean regulations.
With this service handling the paperwork associated with hiring staff abroad, employers can rest assured that they have taken all necessary steps required when it comes to legally hiring an employee in Chile.
What Are Your Responsibilities?
When looking to hire an employee through an EOR in Chile, US and Canadian employers must take on certain responsibilities. This ensures that the employment is compliant with Chilean law. The most important responsibilities are:
- Ensure wages offered for a given role comply with Chilean labor laws. This includes a minimum wage, overtime pay and any other bonuses or benefits that may be legally required.
- Be aware of working hours. Employees in Chile are typically entitled to at least one day off per week and must not work more than 8 hours per day or 44 hours per week.
- Provide any mandatory benefits that employees are entitled to under Chilean law i.e. social insurance contributions, health insurance or retirement programs (check with EOR because this varies from region to region)
- Ensure compliance with all local tax requirements when hiring an employee through an EOR in Chile. Documents will be filed correctly and all taxes will be paid on time.
Once all legal requirements have been met it’s time to start searching for the right candidate! Companies should consider posting roles on job boards that cater specifically to their needs or use recruitment agencies that specialize in connecting international talent with employment opportunities abroad. With sufficient planning and preparation before recruiting staff from Chile, companies can rest assured they have taken all necessary steps required when it comes to legally hiring an employee in Chile.
How Do I Choose the Right EOR for Me in Chile?
When it comes to finding an EOR in Chile, US and Canadian employers must do their due diligence to ensure they choose the right partner. Things companies should look for when considering an EOR:
- A good reputation and experience in the Chilean market.
- Local experience, proper licenses and authorization from the Chilean government.
- References from previous clients and make sure that the EOR is up-to-date with local labor laws as well as any changes or updates to regulations that may affect their operations.
- Services offered by potential EORs related to hiring staff in Chile, including payroll processing, benefits administration, tax filing, compliance monitoring, and legal advice.
- Any additional services offered by potential partners such as visa applications or language courses for employees.
- Pricing structures among different providers so businesses can get the best value for their money.
- Comprehensive support with knowledgeable representatives who are available to answer questions or address concerns regarding employee contracts or compliance issues.
- Multilingual capabilities so they can better serve international employees located in Chile who speak different languages other than English or Spanish.
Borderless: A Solution for Your Human Capital Needs in Chile
Borderless is your Employer of Record (EOR) of choice in Chile. With Borderless, US and Canadian employers can be sure that they have chosen a reliable partner who understands their needs and provides them with all of the necessary support needed to successfully hire staff from this jurisdiction legally and effectively manage payroll services going forward.
Book a demo today! We can help you quickly and easily hire, onboard, pay, and retain the Chilean talent your organization needs to grow and expand your business worldwide.
Disclaimer
Borderless does not provide legal services or legal advice to anyone. This includes customers, contractors, employees, partners, and the general public. We are not lawyers or paralegals. Please read our full disclaimer here.
