How to hire remote employees in

Chile

Home to big rivers, bigger mountains, and some of the best remote talent in the world, Chile is a great place to hire. But it can also be confusing, if you’ve never hired in Chile. By the end of this page, you’ll know how to hire remotely in Chile without getting hit by legal fines or lengthy paperwork.

Country snapshot

CURRENCY
Chilean Peso (CLP)
EMPLOYER TAXES
4.39%
PAYROLL FREQUENCY
Monthly
OFFICIAL LANGUAGE
Spanish

What to know before you hire in 

Chile

Found some great remote talent in Chile, but slightly more confused about how to hire that talent? Well, you’ve got two options: Hiring talent as employees, or hiring talent as contractors. Here are the big differences between the two.

If you want to successfully hire in 

Chile

, you have two options:

Hire talent as contractors

Laws about hiring contractors are significantly more simple in 

Chile

. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Panther for.

Hire talent as employees

This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in 

Chile

 is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.

Why hire independent contractors in 

Chile

Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in 

Chile

.

It’s the fastest way to hire globally

Hiring employees takes months, at the minimum. When you hire with Panther’s locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.

It’s a lot cheaper

It costs just $0 to sign up for Panther, then $49 per month to hire your contractors with Panther. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.

It’s more flexible for you & your team

Hiring contractors in 

Chile

 means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.

It’s less risky than hiring employees

Hiring employees is a bigger commitment, and generally puts you at a bigger risk for legal fees. When you hire contractors overseas, your biggest risk is misclassification—but even then, misclassification penalties are often minimal and just require you to pay off any compensation that the person would have been owed as an employee.

Some people want to be employees

The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.

You might not have as much control over your talent

Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.

How can I pay people in 

Chile

?

If you’re hiring contractors in 

Chile

, you can pay them with Panther in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.

Hiring and paying your team in 

Chile

Hire and pay with Panther

Pay everyone with a single click
Get great currency conversion rates
Pay $0 in platform fees
Run payroll in seconds
Let Panther automatically create & store invoices
Let Panther automatically write locally-compliant contracts
Let Panther automatically file local tax documents

Hire and pay without Panther

Pay all your contractors individually
Do all currency conversions yourself
Shoulder the burden of platform fees
Spend hours each month making payments
Manually track & store invoices
Manually write & sign contracts
Manually file relevant tax documents

Let Panther save you from hiring headaches.

Sign up today for $0

If you want to hire employees in 

Chile

If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Chile than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Chile.

Taxes in 

Chile

Employer tax

Unemployment

Disability and Survival Insurance (SIS)

Individual tax

Leave

Paid Time Off (PTO)

PTO is calculated by the:

  • Employees who have been employed for at least 1 year are entitled to 15 working days paid leave.   

Public Holidays

There are 16 public holidays in Chile.

Sick Days

The duration of sick leave entitlement provided to workers is dependent on how long they have been employed by their employer:

In Chile, employees are entitled to sick leave if they can provide a medical certificate within 2 days from the beginning of the leave.  The employer must then forward the certificate to the health insurance within 3 days.  

  • For the first 3 days of sick leave, the employee is not entitled to pay  
  • From the 4th day on, employees are entitled to sick pay, however, it may be subject to a cap.

Maternity Leave

In Chile, the woman is entitled to 30 weeks of paid maternity leave, divided by 6 weeks before the birth and 24 weeks after, and is paid by health insurance.

During the pregnancy, the woman is not required to participate in activities that would endanger her health (i.e. heavy lifting). If this is a requirement of the job, the employer must reassign her to a different position during her pregnancy without pay reduction. 

Paternity Leave

Fathers are entitled to 5 days of paid paternity leave.

After the 7th week of birth, the mother can opt to transfer some or all of her maternity leave to the father.

Parental Leave

Female employees are entitled to 10 days of parental leave for a child under the age of 18. While the employee is entitled to be paid, they must make up the time taken off at a later date.

Other Leave

None.

Marriage Leave

None.

Bereavement Leave

If a member of the employee’s immediate family passes away, the employee is entitled to 3 days of paid leave.

Termination

Termination Process

In order to terminate an employee, the cause must first be decided.  By law, the following reasons are valid reasons for termination:

  • Mutual agreement, resignation, or expiration of a contract
  • Breach of contract (employer must be able to provide proof)
  • Company needs or reorganization (the most common reason for the dismissal of an employee)

The employer must prepare a letter for the employee stating the cause for termination as well as the effective date and it must be signed in person by the employee or sent by certified mail to their home address.  In addition, the same letter must be filed with the Chilean Labor Ministry.  It is common that the employee to be notified on the last day of work.

After the termination letter is given, the employer must prepare a severance agreement which must include the cause for termination as well as the amount that will be paid out to the employee.  The severance agreement must be signed within 10 days of the termination.

In the case of a mutual agreement, both parties must sign a document acknowledging that both parties have agreed that the employment contract is terminated.  A severance agreement must also be signed within the first 1-2 weeks following the termination date.

Notice Period

The notice period in Chile is:

The notice period is 1 month by law.  It is common that the notice period is waived and payment is made in lieu. 

Severance Pay

The Severance Pay in Chile depends:

If the employee has completed at least 1 year of employment, they are entitled to severance pay.  For every year of service up to 11 years, the employee is entitled to 1 month’s salary. In addition, after one year of employment, the employee accumulates an additional month of severance pay if they have worked for at least half of the following year. 

Probation Period

Probation period is 12 months.

Employee requirements in 

Chile

Working Hours

A full workweek in Chile is 45 hours. The employer has the right to extend the day by no more than 2 hours a day, or 10 hours a week.

Overtime

Overtime is paid at a rate of 150% of the regular pay.

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