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If you are planning to hire in Chile, it’s important to understand how employment relationships are regulated under the country’s Labour Code. Employment contracts must be agreed upon and signed by both the employer and the employee, and they must clearly outline job duties, salary, benefits, working hours, and contract duration.
Chile has a regulated minimum wage, which employers must comply with, along with strict payroll, tax, and social security obligations. Employers are required to withhold income tax and make contributions to pension funds, health insurance, and unemployment insurance.
Chile offers access to a skilled workforce and a stable business environment, but employment laws are detailed and strictly enforced. Before hiring, companies should familiarise themselves with local compliance requirements, contract registration rules, and employee protections to avoid penalties.
Chile is one of the most developed economies in Latin America, making it an attractive destination for hiring remote talent.
The country has a highly educated workforce, particularly in sectors like technology, finance, and engineering. Many professionals are experienced in working with international companies and are comfortable operating in remote environments.
Chile also benefits from strong infrastructure, reliable internet connectivity, and a growing remote work culture. Time zone alignment with North America makes collaboration easier for global teams.
Additionally, Chile’s legal framework supports flexible working arrangements, including remote work, while ensuring employees receive full labour protections. Combined with government support for business and foreign investment, Chile is a strong option for building distributed teams.
As global hiring becomes more complex, managing employment, payroll, and compliance in Chile can be time-consuming and risky without local expertise.
With Native Teams’ Employer of Record (EOR) services, you can hire employees in Chile without setting up a local entity. We handle employment contracts, payroll processing, tax compliance, and benefits administration on your behalf.
We provide guidance through Chile’s legal system, ensure compliance with local labour laws, and reduce administrative burden so you can focus on growing your business.
Hire your first Chilean employee with Native Teams.
Here are the most important legal aspects to consider when hiring employees in Chile:
Employment in Chile is governed by the Labour Code (Código del Trabajo), which defines the rights and obligations of both employers and employees.
The law recognises an employment relationship when an individual provides services under subordination and receives remuneration. Even if no written contract exists, the relationship may still be legally recognised based on actual working conditions.
Employers are required to register employment contracts with the Labour Authority within a specific timeframe and comply with all statutory employment regulations.
Chilean law recognises several types of employment contracts.
Individual employment contracts are the most common and are signed directly between the employer and employee. These can be indefinite (permanent), fixed-term, or project-based contracts.
Collective agreements are negotiated between employers and employee unions and define working conditions, wages, and benefits for a group of employees.
Special contracts also exist for specific industries or roles, such as temporary or outsourced workers.
Employment contracts in Chile must be in writing and include key details such as:
Employers must formalise the contract within 15 days of the employee starting work (or within 5 days for short-term contracts).
Download a free employment contract for Chile through Native Teams.
Although employment relationships can legally exist without a written contract, Chilean law requires employers to formalise contracts in writing.
Electronic contracts are also valid, provided they meet legal requirements and include proper electronic signatures. Employers must store and register contracts with the Labour Authority. Failure to document contracts properly may result in penalties and legal assumptions in favour of the employee.
Chile is gradually reducing its working week under the 40-hour law. As of 2026, the maximum working week is 42 hours, with a plan to reduce it to 40 hours by 2028. Employers and employees may agree to distribute hours under a fixed weekly schedule, or as an average over cycles of up to four weeks, provided that the weekly average does not exceed the legal limit, no week exceeds 45 hours, and extended weeks cannot occur for more than two consecutive weeks in the cycle.
Meal breaks are not considered working time unless agreed otherwise. Employees must also benefit from daily and weekly rest periods in accordance with the Labour Code, with Sunday generally serving as the weekly rest day unless a legal exception applies.
In addition, employers must keep a reliable attendance and time-record system (book, clock, or electronic system) to track ordinary and overtime hours.
Chilean law does not impose a universal night shift premium, but it includes protections for employees working during night hours. Night work restrictions apply especially to minors and pregnant employees. Additional compensation for night work is usually agreed through contracts or collective agreements, unless it qualifies as overtime.
Employees in Chile are entitled to rest breaks and leave benefits regulated by the Labour Code. A minimum 30-minute unpaid meal break is required during the workday. Employees must also receive at least 12 hours of rest between shifts and one full day of rest per week, typically Sunday. Additional leave types include bereavement leave, marriage leave, and other statutory absences.
Employees are entitled to at least 15 working days of paid annual leave after completing one year of service. Leave must generally be taken continuously, although part of it can be split by agreement. Unused leave can be carried forward under certain conditions or paid out upon termination.
According to the Chilean Labour Code, "remuneración" encompasses all amounts that an employer must pay an employee for work performed, whether in cash or in kind. This includes basic wages, bonuses, allowances, and performance pay, except for pure expense reimbursements.
Salaries must be paid in legal currency (Chilean pesos), unless collective agreements stipulate otherwise and the alternative currency has equivalent legal value. Employers must provide employees with a detailed pay stub that specifies the base salary, allowances, hours worked, overtime, and any deductions.
Chile has a statutory minimum wage, set by government decree and adjusted over time. This minimum wage applies to all employees except those with certain exemptions (e.g., minors between 15 and 18 years old with parental consent).
As of January 2026, the minimum monthly salary is:
The Labour Code provides flexibility regarding pay intervals; many companies pay monthly, but fortnightly or weekly arrangements are permitted if stipulated in the contract or collective agreement.
To calculate the salary and taxes in Chile, click here.
Employees are entitled to paid sick leave with a valid medical certificate. Sick leave is funded by the health insurance system, not the employer. Payment conditions depend on the duration of absence, with full pay typically provided for longer sick leaves. Employees are protected from dismissal while on certified sick leave.
Chile provides strong parental leave benefits supported by the social security system. After maternity leave, employees can take additional parental leave, either as full-time leave or part-time arrangements. Part of this leave can be transferred to the other parent.
Maternity leave lasts 18 weeks (6 weeks before birth and 12 weeks after), paid through social security. Fathers are entitled to 5 days of paid paternity leave, which can be taken within the first month after birth.
Employment can be terminated in Chile through several methods, including mutual agreement, resignation, contract expiration, or dismissal due to business needs or misconduct. Employers must follow strict legal procedures and provide written notice with clear reasons for termination.
Employers may terminate employment due to business needs, such as restructuring or economic reasons. Employees with at least one year of service are entitled to severance pay and notice, unless dismissed for serious misconduct.
Employers must provide 30 days’ notice or compensation in lieu of notice. Employees have the right to challenge unfair dismissals in labour courts. If the dismissal is deemed unjustified, employers may be required to pay additional compensation.
Chile provides unemployment protection through a system based on individual savings accounts and a solidarity fund. Employees can access funds accumulated during employment and may receive additional support if they meet eligibility criteria.
Severance pay is mandatory in certain cases, particularly when employees are dismissed due to business needs. Employees are entitled to one month’s salary per year of service, capped at 11 months. Additional compensation may apply in cases of unfair dismissal.
Chilean labour law generally does not recognise probationary periods. Instead, employers often use fixed-term contracts to evaluate employees before offering permanent positions.
Intellectual property created during employment typically belongs to the employer if it is related to the employee’s job duties. However, creations outside the scope of employment may remain the property of the employee unless otherwise agreed.
Employers may collect, access, use, and process employees' personal data only to the extent necessary for the establishment, management, and performance of the employment relationship, compliance with legal obligations, or the legitimate execution of work-related activities.
They must protect the confidentiality, integrity, and security of employee data, physical and electronic, and prevent unauthorised access, disclosure, or misuse. Employees must be informed how their data is collected, used, and stored.
Employment contracts should include a data privacy clause under which employees authorise processing of their personal data for employment purposes (payroll, compliance, HR management, security, benefits), identifying the data categories, purposes, and employee rights involved.
Employees are generally restricted from engaging in competing activities during employment. Post-employment non-compete clauses are enforceable only if they are reasonable in scope, duration, and geography, and may require compensation.
Remote work is legally recognised in Chile and must be agreed upon in the employment contract. Employers must register remote work arrangements and ensure employees have the necessary tools and working conditions.
Remote employees are entitled to the same rights as on-site workers, including salary, benefits, and social security. Employers must provide equipment, ensure health and safety compliance, and respect employees’ right to disconnect.
Hiring employees from Chile provides access to a highly skilled, educated workforce with strong international experience.
Compared to North America or Western Europe, labour costs can be more competitive while maintaining high-quality output. Chile’s stable economy, strong legal system, and business-friendly environment also make it a reliable hiring destination.
Additionally, Chile’s time zone alignment with the US and growing remote work ecosystem make it ideal for global teams.
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