Guatemala Time Zone UTC-6

Undoubtedly, payroll is a critical process for any organization. The pay cycle in Guatemala refers to the period for which an organization pays its employees, and this can vary depending on the pay frequency that the organization chooses to adopt.

In Guatemala, salaries are paid on a monthly, bi-monthly, weekly, daily, or hourly basis, depending on the type of work and what is agreed upon in the employment contract.

Salaried employees should receive two bonuses a year, equivalent to 1 months’ salary each as a 13th and 14th-month payment. The Bonus 14 (“Bono 14”) is payable in July of each year, and a Christmas bonus is payable in December.

The Ministry of Labor and Social Security has issued Government Agreement 307-2023 and officially published the minimum wage in the Official Gazette, effective January 1, 2024.

Below are the minimum wages in force for the period 2024 applicable by Economic District:

Economic Constituency One (CE1):

Per Day:

Per Month:

Economic Constituency Two (CE2):

Per Day:

Per Month

Anything over 44 hours in a work week is considered overtime and is paid at a rate of 150% of the regular pay.

In both cases (electronic and physical documents), it is important to emphasize that all employees’ personal documents and those unrelated to Social Security must be kept physically during the employment relationship and at least two years after its termination.

There are 12 public holidays in Guatemala:

• January 01: New Year's Day
• March 20: March Equinox
• April 06: Maundy Thursday
• April 07: Good Friday
• April 08: Easter Saturday
• May 01: Labour Day
• June 21: June Solstice
• June 30: Army Day
• August 15: Assumption of Mary
• September 15: Independence Day
• September 23: September Equinox
• October 12: Dia de la raza
• October 20: Revolution Day
• November 01: All Saints' Day
• December 21: December Solstice
• December 24: Christmas Eve
• December 25: Christmas Day
• December 31: New Year's Eve

Sick pay is either paid by the employer or social security, depending on the reason for the sickness. 50% of the regular pay rate is what applies to a regular employee.

The length of sick pay depends on the length of employment:

• 1 month of paid sick leave: 2–6 months of employment

• 2 months of paid sick leave: 6-9 months of employment

• 3 months of paid sick leave: 9+ months of employment

If the employee has not recovered by the time that the sick leave is over, the employment agreement is automatically suspended (“total suspension”) and all employer and employee obligations are put on hold. In this case, the employee may terminate the employment agreement, however, the employer may not unless under just cause.

In addition, the employer may seek to fill the employee’s duties on a temporary basis which can be terminated upon the return of the employee.

Mothers are entitled to take maternity leave starting 30 days before the expected due date for an overall period of 84 days. In the event of a miscarriage or stillbirth, the mother is entitled to 42 days of paid leave.

There are no provisions in the law for paternity leave.

Bereavement leave – 3 days of paid leave in the event of the death of a spouse or child.

Wedding – 5 days of paid leave for the employee to participate in his/her wedding

Labor union leader – up to 6 days of paid leave for a member of a union’s executive committee in order to carry out union duties. Such a person may also be entitled to additional unpaid leave.

Judicial summons – half a day of paid leave

When the periods of notice are determined in accordance with the Employment Contracts Act, the employer, and the employee may agree on the periods of notice (no longer than six months). Collective agreements may contain provisions on periods of notice. If the periods of notice in the collective agreement differ from the statutory periods of notice, the employer and the employee must observe the periods of notice laid down in the collective agreement.

The amount of notice is dependent on the length of service and reason for termination. If the employer terminates the contract, the notice period is as follows:

• For employees with employment service of up to 6 months- 1 weeks’ notice

• For employees with between 6 months and 1 year employment service- at least 10 days’ notice

• For employees with between 1- and 5-years employment service – at least 2 weeks’ notice

• For employees with more than five years employment service- 1 months’ notice

The law requires that all salaries, bonuses and other applicable employee benefits must be paid to the employee up to the date of their dismissal, whether or not the dismissal is for a just cause. However, if the dismissal occurs without a just cause, the law additionally requires the payment of a severance amount for damages, equivalent to one month's salary for each year of continuous service (or in proportion to the period of continuous service where this is less than one year). The monthly salary is not limited to basic or nominal salary alone and is calculated on the basis of the employee's last six months of salary, including all payments received (for example, bonuses and other applicable employee benefits).

In addition, Guatemalan labor law also has a specific legal concept known as "economic advantages" (ventajas económicas), which comprises all non-cash benefits granted by the employer to the employee (such as health or life insurance, company vehicles and mobile phones, cafeteria or other food services, and so on). These benefits are calculated as comprising 30% of the total salary for the purposes of calculating the severance payment, and so where these non-cash benefits have been provided by the employer, this additional payment of 30% of salary will be added to the total amount payable as part of the severance payment.

If the severance payment is not paid following dismissal without just cause, the former employee has the right to sue the former employer before a labor court to demand payment of:

1. The severance payment.
2. Any other outstanding salary, bonus, or benefit which is still due.
3. The payment of additional salary (up to 12 months of salary) to cover the employee's loss of earnings during litigation.
4. Litigation costs.

A foreign national willing to work in Guatemala should obtain a residence permit once inside Guatemalan territory on a tourist visa. The person must submit all the necessary documents to the Institute of Immigration.

In Guatemala, the residence permit is granted for between one and five years; a work permit is for one year, and it is extendable; a temporary visa is two months from the date of filing, and its validity is for a maximum period of five years. Once the visa expires, the person can apply for a permanent residence visa to live in the country.

Once the migrant worker's residence permit is obtained, the person must file an application for a work permit with the Labour Ministry. The work permit is granted for three months from the date of filing and it can be renewed 15 days before it expires. It is usually valid for one year.

There is no specific restriction or prohibition on a potential employer carrying out background checks in relation to applicants. However, the Guatemalan Constitution states that police records and criminal records cannot be used as a reason to restrict any constitutional right (including the right to work), and the Guatemalan Labour Code also prohibits any form of discrimination that affects access to work.