Uruguay
Knowledge Base
Frequently asked question, important data and information on EOR.
General information
$ 21,106 UYU monthly
Labor Law
Laws that regulate Labor Relationship
Uruguayan Labor Law
Onboarding guide
Requirements for a labor contract
• Salary
• Complementary benefits
• Working hours
It is obligatory to register the employee for social security purposes (BPS) and in the list of employees, which is open to inspection by the Ministry of Labor (MTSS) at any time. Employees must also be insured at the State Insurance Bank (Banco de Seguros del Estado -BSE) to cover any illness or workplace accident.
Pre-hire Medical exam
No
Types of contracts
• Indefinite
• Fixed-term contract
• For specific work
Probation Period
3 months
Are offer letters mandatory in the country?
Yes
Are digital signatures in labor contracts valid?
Yes
Mandatory onboarding documents
•Identity documents
• Health card
• CV
• Documents of dependent minor children (if applicable)
• Marriage certificate (if applicable)
Statutory benefits
Annual Bonus
One month’s salary, divided equally between June and December
Additional bonus
No
Leaves (medical, maternity, paternity, etc.)
• Marriage leave: 3 days
• Paternity leave: Under Law 19,161, 3-10 days beginning on day of birth.
• Study leaves: Regulated by Article 2 of Law 18,458 which establishes:
A) For up to 36 hours of study per week, 6 days per year minimum.
B) Between 36 and 48 hours per week, a minimum of 9 days per year.
C) Over 48 hours per week, a minimum of 12 days per year.
• Bereavement leave: 3 days.
Annual Leave (days per year)
20 days, plus one day more for every four years served.
How do vacation days expire?
Proportional compensation.
Official Holidays
• 1 Jan, New Year’s Day
• 6 Jan, Epiphany
• 20 Feb, Carnival
• 21 Feb, Carnival
• 6 Apr, Maundy Thursday
• 7 Apr, Good Friday
• 17 Apr, Landing of the Patriots
• 1 May, Labour Day
• 22 May, Battle of Las Piedras Holiday
• 19 Jun, Birth of Artigas
• 18 Jul, Constitution Day
• 25 Aug, Independence Day
• 16 Oct, Day of the Race
• 2 Nov, All Souls’ Day
• 25 Dec, Christmas Day
Working on holidays and Sundays
Double time, and double time and half for overtime hours on holidays.
Number of Working hours
8 hours a day, 48 hours a week.
Overtime
Double time.
Social Security (what does it cover)
• Retirement and pensions
• Benefits for unemployment and health insurance benefits for workers
• Parental care allowance
• Disability and survivors’ benefits
Payroll
Salary payment currency
Uruguayan peso (UYU)
Can salary be paid in a different currency other than the local currency?
No
Payment frequency
•Monthly
• Bi-weekly
• Weekly
VAT percentage
22% standard
Income Tax
Individual income tax is levied on income obtained by resident and non-resident individuals. The progressive income tax rates ranges from 5% to 36.00%. For more information see https://taxsummaries.pwc.com/uruguay/individual/taxes-on-personal-income
Tax Payer Identification Number
Tax General Direction – DGI (Dirección General Impositiva)
Offboarding
Voluntary resignation
Resignation is always free and voluntary; if there is any breach by the employer or his conduct that forces the employee to resign, this is not a resignation but an indirect dismissal.
Contract termination
• Resignation
• Termination of contract by employer
• Mutual agreement to terminate the agreement
• Expiration of the agreed term in the contract
• Conclusion of the work or service that gave rise to the contract
Justified Dismissal
Dismissal is allowed without justifying any cause, provided that severance indemnity is paid. Inclusively there is no obligation of a notice prior to dismissal.
Unjustified Dismissal
In Uruguay, there is no legal definition of unfair dismissal. Doctrine and jurisprudence (although not a source of law in Uruguay) have created the figure of “abusive dismissal” for those cases of notorious abuse by the employer when dismissing (for example dismissal of offending worker´s dignity – shouting or insults-, dismissal as a consequence of testifying against the employer at a labor court). In these cases, apart from the regular severance indemnity, if the employee proves the case in Court, the employer is obliged to pay pain and damages (which amount from 1 to 3 times the ordinary severance pays, plus regular severance indemnity).
3 month’s salary for each year or fraction thereof worked, plus outstanding leave, the vacation salary and untaken bonus.
Minimum Notice Period
The Law do not specify an specific notice period, however, although not mandatory, consultation with worker ´s representative is recommended and a common practice in Uruguay.
Immigration
Visa process
1. Residence permit must be applied for in the country.
2. Upon arrival, acquire the vaccination card and request the migration appointment, together with the lawyer.
3. Lead time for approval is 1-3 months.
Visa documents
• Two passport photos
• Date of entry to the country duly accredited and the document presented at the entry.
• Birth certificate and apostilled criminal record certificate
• Health Card issued in Uruguay and Current Vaccination Scheme Certificate.
• One white background photo with 4×3 cm. Digital image must be .jpg with a size less than 300Kb.
• Possess the Desire to Stay in the Country. (A lawyer will process it directly)
• Proof of funds. Employment contract required.
Any foreign document that is presented to be added to the file must necessarily be apostilled or legalized by the corresponding Uruguayan Consulate and the Ministry of Foreign Affairs in Uruguay (according to the provisions of Law No. 15441).
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