Reduction of Working Hours Allowed in Costa Rica

The Executive Branch endorsed the new law that allows companies to temporarily reduce the working hours agreed with their employees, in the context of the crisis generated by the covid-19 virus.

Monday, March 23, 2020

On the morning of March 21, the deputies gave the second debate with 47 votes and unanimous approval to file 21854, the law authorizing the reduction of working hours prior to the declaration of a national emergency, reported the Assembly.

See "Project to Reduce Working Hours Progresses" and "Coronavirus: How Will It Affect Business?"

The project seeks to guarantee that workers in the private employment regime keep their jobs. This will be done through the possibility of reducing working hours when the gross income of companies is affected by a declaration of national emergency.

The law became firm after President Carlos Alvarado endorsed the Legislative Assembly's action on the afternoon of 21 March.

Coronavirus: How do the outlook for companies in Costa Rica change?

We prepared for our clients the report "Information System: Impact Analysis of Covid-19 on Business" which helps companies to measure the impact that the crisis will have on their activity in the coming months.

More on this topic

Guatemala: Labor Contracts Suspended

April 2020

Following the state of calamity in the country, the Ministry of Labor created an electronic procedure, through which companies can temporarily suspend the contracts of their workers.

Ministerial Agreement 140-2020, published on April 7 in the Official Journal, explains that the government measure is temporary and exclusively applicable as long as the circumstances and effects of the covid-19 pandemic, which has been declared worldwide, and its effects on employment contracts persist.

Proposal to Ban the Dismissal of Workers

March 2020

After a home quarantine was decreed in El Salvador, the government intends to prohibit the dismissal of employees who do not attend work.

In the context of the crisis generated by the spread of covid-19, a proposal is being discussed that establishes that the employees of companies that are not allowed to continue their activities should be sent home with their salaries and benefits, and that they cannot be subject to dismissal, salary discounts or suspension of contract, nor be forced to take their vacation in advance.

Project to Reduce Working Hours Progresses

March 2020

In order to preserve jobs in the context of the covid-19 crisis, the Costa Rican Legislative Assembly approved in first debate a bill authorizing the temporary reduction of the working hours agreed upon by the parties.

On March 19, the bill authorizing the reduction of working hours in view of the declaration of a national emergency was approved in the first debate.

How to Maintain the Employment Level?

March 2020

The partial suspension of employment contracts and social security payments are some of the proposals made by employers in Costa Rica to maintain employment levels in the face of the spread of the Covid-19.

Representatives of the Costa Rican Union of Chambers and Associations of the Private Business Sector (UCCAEP), predict that if urgent actions are delayed, unemployment could rise from 12% to 19%.

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