English, Miskito, Sumo, and Rama

UTC -06:00

Undoubtedly, payroll is a critical process for any organization. The pay cycle in Nicaragua 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.

Weekly payments are normally made to manual laborers, and monthly payments are made on the fifteenth day of the cycle.

Employers are required to make 13th-month payments, and they must do so within the first ten days of December.

Every worker has the right to be paid an additional month's salary by his employer after one year of continuous work, or the proportional part that corresponds to the period of time worked, greater than one month and less than one year.

The thirteenth month must be paid within the first ten days of the month of December of each year or within the first ten days after the employment contract ends. In case of not doing so, the employer will pay the worker an indemnity equivalent to the value of one day of work for each day of delay. 

The industry in which an individual works determines the country's minimum salary. For the industries of agriculture, forestry, and fishing, the national minimum wage is 4,723.95 NIO per month, whereas it is 10,571.78 NIO per month for the industries of construction, financial institutions, and insurance.

With effect from March 1, 2023, the monthly minimum wage of employees in Nicaragua has increased by 10%.

All work performed after regular business hours is compensated as overtime and subject to labor contracts or collective bargaining agreements. There is a cap of 9 hours per week when an employee is asked to work extra or on holidays.

Every hour of overtime in excess of 48 hours per week is compensated at 200 % of the employee's base pay.

Employees are entitled to a 24-hour rest break in place of payment for work completed on the weekends or on holidays.

The number of overtime hours may not exceed three hours per day or nine hours per week, except as the following:

1. To prevent or eliminate without delay the consequences of catastrophes or accidents that may harm production or services.
2. To carry out urgent repair work on machinery, equipment, or buildings, when their poor condition endangers the health or life of the workers or the population;
3. To carry out urgent tasks aimed at reestablishing public services or repairing the consequences of disasters that affect said services;
4. To carry out seasonal or intense seasonal work, when it is impossible to increase the number of workers for technical or climatic reasons or due to a labor force shortage.

Overtime hours and those worked by the worker on his day of rest or compensation for any reason will be paid one hundred percent more than what is stipulated for the respective normal day.

Any personal data shall be kept for five years, or for the term that the parties agree upon, even in the event of the personal data no longer being adequate, proportional, or necessary for the purposes which it was created

The law provides for gender equality. Nevertheless, women often experienced discrimination in employment, credit, and pay equity for similar work, as well as in owning and managing businesses.

The Nicaraguan constitution states that working is a social responsibility and the right of all citizens. Under the law, citizens are entitled to equal pay for equal work and freedom from discrimination based on the following traits:

• Religion
• Political views
• Race
• Gender

Discrimination against persons with physical, sensory, intellectual, and mental disabilities was widespread despite being prohibited by law.

There was lethal and increasing societal violence against women; violent attacks against lesbian, gay, bisexual, transgender, and intersex (LGBTI) persons, to which police failed to respond; trafficking in persons; discrimination against ethnic minorities and indigenous persons and communities; societal Country Reports on Human Rights Practices for 2017 United States Department of State • Bureau of Democracy, Human Rights and Labor discrimination against persons with disabilities; and discrimination against persons with HIV/AIDS.

The following information is required during onboarding:

• Personal information: Name, Surname, address, DOB
• Identity Card
• Residence proof

To evaluate an employee's performance and eligibility for the position, Nicaraguan employment law specifies a standard probationary term of one month (30 days). Within the trial period, either party may terminate the agreement for valid reasons.

There are 11 public holidays identified in Nicaragua: 

• January 1: New Year's Day
• April 14: Maundy Thursday
• April 15: Good Friday
• May 2: Labour Day
• May 30: Mother's Day
• July 19: Sandinista Revolution Anniversary
• September 14: San Jacinto Day
• September 15: Independence Day of Nicaragua
• November 2: All Souls Day
• December 8: Feast of the Immaculate Conception
• December 26: Christmas

Employees are entitled to up to 26 weeks of paid sick time, which begins on the fourth day of illness and is reimbursed by Social Security at 60 % of the regular pay.

Sick leave's initial three days are unpaid (unless the company has established a practice of paying for those days, and it is stipulated within the employment contract).

However, the 3-day waiting time and unpaid leave are removed if the employee is hospitalized if the illness or injury is related to their job.

In Nicaragua, maternity leave is 12 weeks long and is compensated; an employee must take four weeks off prior to the birth of the child and eight weeks off afterward.

An employee is entitled to 14 weeks of paid leave in the event of multiple births, with four weeks of such leave to be used prior to the baby's birth and 10 weeks following it.

All maternity leave is paid for by Social Security at a rate of 60% of the employee's regular wage and 40% from the employer, making it a fully compensated leave.

A maternity leave benefit of 12 weeks is provided to workers who are paid into Social Security for at least 16 weeks before giving birth, at a rate equal to 100 % of the employee's average weekly wage. If an employee hasn't made social security contributions, the employer is responsible for paying the compensation.

After the kid is born, the father or partner is entitled to 5 days of paid paternity leave.

There are no provisions in the law regarding parental leave.

Workers have the right to leave or leave with pay in the following cases: a) Due to the death of the father, mother, children, or spouse, a partner in a stable de facto union according to the law, up to three consecutive business days; b) For marriage, up to five consecutive business days.

Right to nursing breaks or a daily reduction of hours of work:

Fifteen minutes every three hours. Time spent nursing shall be counted as time worked. Time spent by female workers for breastfeeding breaks will be paid as time worked.

When the contract is for an indefinite period of time, the worker may terminate it by notifying the employer in writing fifteen days in advance.

The termination of the individual contract or employment relationship puts an end to the generation of the rights and obligations that emanate from them.

The individual contract or employment relationship ends:

1. Due to expiration of the agreed term or completion of the work or service that gave rise to the contract;
2. Due to the death or permanent incapacity of the employer that brings as a precise consequence the termination of the company; or due to death or permanent disability of the worker;
3. By conviction or sentence of deprivation of liberty of the worker;
4. By the definitive cessation of the industry, commerce, or service based on legally substantiated economic reasons and duly verified by the Ministry of Labor;
5. By firm judicial resolution whose consequence is the definitive disappearance of the company;
6. By the termination of the contract in accordance with the law;
7. Due to the retirement of the worker;
8. Due to force majeure or fortuitous event when they bring the closure of the company as a precise consequence.

Whatever the cause of termination of the employment contract, the employer is obliged, according to the Law, to pay the worker, or whoever corresponds in the case of literal b), the proportional part of the benefits such as vacations and thirteenth month.

The termination of the labor relationship by mutual agreement or resignation does not affect the acquired right of the worker due to seniority. When the employer terminates the employment contract for an indefinite period of time and without just cause, it will pay the worker compensation equivalent to:

1. One month's salary for each of the first three years of work;
2. Twenty days of salary for each year of work from the fourth year.

In no case will the indemnity be less than one month nor more than five months. The fractions between the years worked will be settled proportionally.

A work permit can be obtained by foreign nationals who plan to work or engage in remunerated activities in Nicaragua for a period of less than a year. The period that the foreign national will carry out employment-related activities in Nicaragua normally corresponds to the duration of the Work Permit. Foreign people who will work or engage in remunerated activities in Nicaragua for more than a year must apply for temporary residence, whether they are independent contractors or employees of Nicaraguan businesses. Temporary residence permits are available for up to a year and are renewed for the same amount of time. The foreign national may petition for permanent resident status, which may be granted for up to five years, after three years in Nicaragua.

To live and work in Nicaragua, foreigners must obtain a one-year Temporary Residence Visa, which is issued based on valid employment in the country. An applicant can apply for it at the Nicaraguan embassy in their home country and or through their employers in Nicaragua.

For work commitments of more than one year, the employees need to apply for visa renewal every year or appeal for a Permanent Residence Visa that allows them to stay and work for five years in Nicaragua.

To live and work in Nicaragua, foreigners must obtain a one-year Temporary Residence Visa, which is issued based on valid employment in the country. An applicant can apply for it at the Nicaraguan embassy in their home country and or through their employers in Nicaragua.

For work commitments of more than one year, the employees need to apply for visa renewal every year or appeal for a Permanent Residence Visa that allows them to stay and work for five years in Nicaragua.

Steps required to get a work visa in Nicaragua:

1. A Temporary Residence Visa is sufficient for foreigners to work in Nicaragua.
2. The employer has to apply for a work visa on behalf of the workers.
3. The employer has to provide a valid reason to the authorities to justify hiring foreign nationals; since the local citizens get priority in employment.
4. Once a temporary visa is approved, workers can stay and work in Nicaragua.
5. The visa needs renewal after 12 months. Three consecutive renewals make workers eligible for a Permanent Residence Visa for five years.

1. Contrary to its name, a Permanent Residence Visa is valid only for five periods and needs renewals every five years.
2. If ex-pats marry a Nicaraguan citizen, they can apply for a Permanent Residence Visa by producing their marriage certificate.

There are no mandatory legal provisions for criminal background checks nor legislation prohibiting convicted sex offenders from holding positions involving or facilitating contact with children.