Dominican Republic Employer of Record

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in the Dominican Republic, an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in the Dominican Republic―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in the Dominican Republic and how our employer of record service, EOR, and local HR experts can help you manage your international employment needs.

Employment in the Dominican Republic is governed largely by the Código de Trabajo (Labor Code), which applies to both Dominicans and foreign workers. All provisions in employment contracts must conform to the Labor Code, which is known for its strong protection of the rights of employees. It is unlawful for employees to waive any rights that would lessen their benefits under the Labor Code.

The Labor Code does not require the parties to enter a formal employment contract, but the existence of an employment contract is presumed in any work relationship unless there is proof to the contrary.

An employment contract is not required to be in writing, but a party to an oral employment agreement has the right to require the contract to be formalized in writing. If an employment contract is in writing, any modifications must also be in writing.

As you look to hire employees in the Dominican Republic, here are some standard regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs.

Normal working hours may not exceed eight a day and 44 a week.

Employees are entitled to a one-hour break after four consecutive hours of work and a 1.5-hour break after five consecutive hours of work.

The weekly work shifts generally end on Saturdays at noon, providing employees with 36 hours of uninterrupted rest. Any other arrangement should give the same rest period of 36 hours.

Any hours worked beyond the normal workweek and up to 68 hours per week are considered overtime.

Overtime work cannot exceed 80 hours in a calendar quarter.

Night shift work is performed between 9 p.m. and 7 a.m.

As you consider the appropriate salary to offer new employees, keep in mind:

As your employer of record in the Dominican Republic, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.

The employer must pay the employee, no later than December 20, a Christmas bonus consisting of one-twelfth of the ordinary salary earned by the employee in that calendar year excluding overtime and profit sharing.

By statute, the Christmas bonus is limited to five times the applicable minimum wage. An employee who has worked less than an entire year is entitled to a pro-rata Christmas bonus. The Christmas bonus is nontaxable.

The Labor Code does not explicitly state a probationary period. However, it does mention that employees are not entitled to prior notice or severance unless they have worked for at least 3 months. Inability or inefficiency as just cause for dismissal expires after 3 months of employment.

Each party to an employment contract has the right to terminate the contract without cause by giving the requisite amount of notice to the other party. An employer that terminates employment without cause is also required to provide the requisite amount of severance pay.

A party that terminates the employment contract without cause must give the following amounts of notice:

A party that fails to give the requisite notice must pay the other party one day’s salary for every day of required notice that was not provided. An employer also must provide written notice to the Ministry of Labor or appropriate local authority within 48 hours.

An employee may resign and must provide the notice may be oral or in writing.

An employer that exercises its right to terminate an employee without cause is required to pay severance pay in an amount determined by the length of the employee’s service:

Severance pay is required even if the employee immediately begins working for a new employer.

When the employment contract terminates because an employee dies, becomes too physically or mentally disabled to work, or suffers an illness that impedes job performance for at least one year, the employer must pay the employee or the employee’s heirs:

The same payments are required if the business is terminated due to the death or incapacity of the employer.

When negotiating terms of an employment contract with a candidate in the Dominican Republic, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

A pregnant employee is entitled to paid maternity leave for the seven weeks before her scheduled due date and for seven weeks after giving birth. If the employee does not use the entire seven weeks of prenatal maternity leave, she may use the remainder of that leave after birth.

If the employee is covered by social security, her maternity leave pay will be paid half by the employer and half by social security. Employers contribute 7.09% of covered payroll and employees contribute 3.04% of covered earnings to finance social security maternity leave, sick leave, and employee medical benefits.

An allowance is paid for up to 12 months after the child’s birth if the insured’s salary is less than three times the legal national minimum wage.

If the employee is unable to return to work after exhausting her maternity leave, she must provide notification to the employer and the Ministry of Labor supported by a medical certificate and may then take additional leave without pay for the time that medical treatment is necessary.

Employees are entitled to annual leave after 1 year of employment with an employer. Employees with:

Annual leave may be taken as agreed by the parties, but the employee must be allowed to take at least 1 continuous week of vacation.

Vacation pay should be paid before the employee takes leave. The employer is not allowed to provide compensation instead of annual leave. All accrued but unused annual leave should be paid when the employee leaves the employer’s service. During vacation, the employee may not provide services to the employer.

Employees are entitled to the following paid public holidays:

All holidays except religious and national holidays are celebrated on the previous Monday if they fall on a Tuesday or a Wednesday and are celebrated on the following Monday in all other cases.

The Labor Code contains no limit on the number of days of sick leave that may be taken. After a three-day waiting period, social security pays 60% of the employee’s earnings in the past six months (40% if hospitalized) for up to 26 weeks to employees who have at least 12 months of social security contributions. Employers contribute 7.09% of covered payroll and employees contribute 3.04% of covered earnings to finance social security, maternity leave, sick leave, and employee medical benefits.

In case of accident or illness, employees are entitled only to receive medical care and compensation specified by the laws on social security and workers’ compensation. If the employee is not covered under social security due to the fault of the employer, however, the employer must pay the employee’s medical expenses and the appropriate compensation.

Disability, old age and survivors’ pensions are paid through mandatory individual social security accounts financed by employer and employee contributions. Employees contribute 2.87% of covered earnings, while employers contribute 7.1% of covered payroll. An employee’s maximum wage for calculating social security contributions is 20 times the legal monthly minimum wage, while health contributions are imposed on salary up to a maximum 10 times the minimum wage.

An employee can claim an early old age pension at age 55 if the employee’s individual account balance is sufficient to finance a pension at least equal to 150% of the minimum old age pension or at ages 57 to 59 if the worker is unemployed and has at least 25 years of social security contributions. A guaranteed minimum pension is available if the employee is 65 years of age and has a low income, at least 25 years of contributions and an account balance insufficient to finance the minimum old age pension established by law. The minimum old age pension equals the lowest legal monthly minimum wage for private sector workers. The pension is not payable abroad.

In addition to healthcare benefits, employees in the Dominican Republic are entitled to pension, which is funded by government tax revenues, as well as workers compensation, which is covered through mandated employer insurance.

Employer social costs will cover a large portion of employee benefits in the Dominican Republic, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance if needed.

Updated: June 05, 2024

We write and validate all local employment contracts, streamlining the onboarding process for you and your Dominican employees—all you have to do is provide relevant information and review and approve the employment agreement. As your employer of record in the Dominican Republic, we will:

The entire onboarding process for the employee is often completed in as little as two weeks.

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on EOR, our employer of record solution, to expand and hire in over 170+ countries around the world, quickly and compliantly.

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in the Dominican Republic. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations— all around the world and can accommodate the payroll outsourcing needs of any size organization.

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.