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República Dominicana - Labor FAQs for Foreign Investors
 

LABOR LAW PRINCIPLES

Which principles of the Labor Law protect employees? Can employees waive the application of said principles?

THE LABOR AGREEMENT

One employee working in my company has incurred a number of faults, what disciplinary measures can I take?

What happens if I do not formalize in writing my labor relationships with my employees?

What is the maximum term in a limited time labor agreement? What happens in said maximum term is exceeded?

WORK DAY

How should I pay employees' time in case of circumstances of over-time? Can I compel my employees to work over-time?

Can I change my employees' work day or work week without their consent? And, what about their work schedule?

What is the minimum rest time within the daily work schedule to which my employees are entitled? Am I to pay the rest time during the work schedule?

HOLIDAYS

Is Sunday a non-working day?

VACATIONS

The salary payment that employee gets during vacation time how is it calculated?

Would I have any responsibilities if by mutual accord with employee, I compensate employee with money for the vacation time for employee to work during that time?

ABOUT THE SALARY

Are commission payments considered as part of the salary?

Must I pay employees the minimum salary even if employees work less time than the law authorized work schedule?

Can I honor my employees' salary in US Dollars? If affirmative, could I pay them the equivalent in local currency?

SUPENSION OF THE EFFECTS OF LABOR AGREEMENTS

What is the rest period I have to grant to my female employee in case of pregnancy? What other benefits must I recognize during the time of her pregnancy and by the time she comes back to work?

Under what circumstances can I suspend the effects of the labor agreements with my employees? What are my obligations in such events?

Must I pay employee the salaries for all the duration of an illness or accident disability?

LABOR AGREEMENT TERMINATION

Can I dismiss a pregnant employee? What procedures should I use for that purpose?

For what justified causes can I dismiss my employee?

What should I pay to the employee that resigns to his work position?

When do I have to pay the Christmas salary to an employee in case of termination of the labor agreement?

Must I pay every year a participation for the benefits to my workers?

Under which conditions must I pay an economic assistance to the worker?

At the end of the contract for determined work and service, or during a certain period of time, should I pay working fringe benefits to the worker?

Dismissal and discharge are the same thing?

WORKING RISKS

Which working risks are covered by the insurance? Which are not covered?

What is considered as a professional disease?

Which consequences can derive in virtue of not ensuring my workers against working risks? Am I always obliged to do it?

SYNDICATION FREEDOM

Which practices forbids me the law to perform, which could be considered as contrary to the purposes of the syndicate?

COLLECTIVE NEGOTIATION

Am I obliged to pact a collective agreement proposed by the syndicate?

Which is the maximum duration of a collective agreement?

COLLECTIVE CONFLICTS

My workers have started a strike, what should I do?

 


LABOR LAW PRINCIPLES

Which principles of the Labor Law protect employees? Can employees waive the application of said principles?

Labor Law principles that protect employees are the following:

In dubio pro employee meaning that in case of doubt employee is favored: any doubts in construing, applying and understanding the scope of the law must be decided in a manner most favorable to the employee.

Application of the most favorable rule means that if a number of legal provisions exist to deal with a same issue, the provision most beneficial to the employee must be applied.

Most beneficial condition: means that it is not possible to subject employees to new laws or legal provisions when they diminish or harm, in any form, their labor conditions - therefore - the previous provisions or laws applicable to those employees must be maintained.


THE LABOR AGREEMENT

One employee working in my company has incurred a number of faults, what disciplinary measures can I take?

You may verbally reprimand your employee and warn employee not to incur that fault again. This is known as an admonition but always staying away from offending employee's dignity or morality. Likewise, you can assess the seriousness of the employee's fault in order to determine if the fault is comprehended within the causes provided for in Article 88 of the Labor Code that imply dismissal. If that is not the case, you can always write down entries describing the fault in the employee's record so as to collect and keep evidences that will allow you to evaluate the employee's performance.


What happens if I do not formalize in writing my labor relationships with my employees?

Nothing happens; the existence of a written labor agreement between you and your employees is not required since such labor relationships are ruled by the labor laws. It is important to always keep in mind that regarding labor relationships, what is important is the reality of the performance of the services, that is to say, the way the labor relationship is effectively developed within its specific conditions such as the work schedule, the work day, salary, etc.



What is the maximum term in a limited time labor agreement? What happens in said maximum term is exceeded?

The maximum term of a limited time labor agreement is that agreed upon by the employer and the employee. If a limited time labor agreement exceeds three months then you must be aware that once the term becomes definitively over you must pay employee the amounts applicable to pre-notice, severance pay, as provided for in Section 80 of the Labor Code, the corresponding amounts are figured out since day one of the labor relationship and until the effective date that is terminated, and Christmas bonus as well. If the term of the agreement is agreed upon for a term of five months or for a larger term, you must pay your employee at termination, in addition to pre-notice, severance pay and Christmas bonus, the vacation time not enjoyed by employee.

Now, however, it is very important for you be aware that if employee continues working for you beyond the original agreed upon term, the labor agreement is not construed as a limited time agreement anymore. It will be considered as an indefinite-term labor agreement for all legal effects applicable thereof and the agreement shall be construed as such indefinite agreement as of day one of the labor relationship. For your better understanding, following we offer you a brief description of each type of labor contract:

Agreements for indefinite terms: the employee is hired to perform work of a permanent nature with the purpose of satisfying normal, constant and uniform needs of employer, uninterruptedly.

Limited term agreements: the employee is hired for a term previously established, be it to increase production, for accidental circumstances of the company, to satisfy a need of the employer that will be over in a specific period of time, provisional substitution of an employee for a temporary reason, for instances vacation time, leave licenses, or when this kind of hiring is convenient to the interests of employee.


WORK DAY


How should I pay employees' time in case of circumstances of over-time? Can I compel my employees to work over-time?

According with the law, the weekly work hours cannot exceed 44 hours. For said reason, if your employees work in excess of that weekly limit, they must be entitled to a larger remuneration as a result of worked over-time.

In the event that over 44 hours are worked and up to 68 weekly hours, a 35% over the regular salary must be recognized for each hour of over-time. If more than 68 hours are worked per week, the applicable percentage per extra hours worked shall be 100%. Besides, if your employee works during the night shift - between 9:00 p.m. 7:00 a.m. - you must recognize an increase of 15% per each hour worked, in addition to the percentages above stated.

In the event that your employee works during the rest period or on a non-working day, you must pay employee the hours worked increased in a 100% over the regular pay. Additionally, if the work performed during those days exceeds the eight-hour daily limit, then you will have to add 35% over these hours and pay the resulting amount accordingly.

Your employee is required to work over-time solely in cases of accidents in the company or if it is imminent they will occur, to perform works to the machines or tools that cannot be halted; to carry out works which by being interrupted could damage the raw materials; in events of Acts of God, or to face extraordinary work increases. In the case of these exceptional needs, you must notice the labor authority of the need and cause for prolonging the applicable work day or work week for the authority to analyze whether said extension is provided for in the law. Nevertheless, in the event of the existence of a valid cause for exceptional extension of the work day or the work week, you will have to honor payment to your employees for the hours worked in accordance with the foregoing increases.



Can I change my employees' work day or work week without their consent? And, what about their work schedule?

You cannot change your employees' work day or week day without their consent. The work schedule may be modified by you provide that such modification does not harm the employee and as long as the change is based on real and justified reasons of your company and not on actions based on bad faith against the employee.


What is the minimum rest time within the daily work schedule to which my employees are entitled? Am I to pay the rest time during the work schedule?

The minimum rest time during the daily work hours of your employees is one hour, after four hours of continuous work, and of one and a half hour after five hours of continuous work. These rest periods are not remunerated. Now, however, if you require your employee to remain at work or in the event that employee is not able to take the daily rest time given the nature of the work performed, then the rest break during the work schedule must be remunerated.

When your employee works a continuous work schedule meaning that upon the nature of employee's work to your company employee must remain at your disposal permanently within the work schedule including those breaks for rest and lunch; the rest break is considered as work effective time and therefore is remunerated.

 

HOLIDAYS


Is Sunday a non-working day?

Sundays are non-workable days if you and your employees have agreed accordingly. If the work schedule agreed upon by the parties includes Sundays, this day is a working day. In this case the employee is entitled to the right to enjoy the weekly rest time during any other day of the week. As a general rule, companies do not work during Sundays.

 

VACATIONS


The salary payment that employee gets during vacation time how is it calculated?

If your employee has worked for you for a period of one to five years, you must pay employee the day prior to starting the vacation period fourteen days of ordinary salary.

If the employee has worked for more than five years, then you must pay employee eighteen days of ordinary salary.

In addition, you have to pay employee the accrued salary until the moment employee starts vacations.

In all cases, the period of time to enjoy vacations by employees is of 14 workable days.



Would I have any responsibilities if by mutual accord with employee, I compensate employee with money for the vacation time for employee to work during that time?

Vacation time for employees is mandatory since their purpose is to provide rest time. You cannot reach an agreement with the employee for a cash money compensation nor for any other vehicle that substitutes vacation time. In an event such as agreeing with the employee on compensating vacations, you would be limiting the rights of the employee and employee would be entitled to sue you in labor courts.



ABOUT THE SALARY

Are commission payments considered as part of the salary?

Yes, commissions you pay employee are part of the salary since they are paid as compensation for a service rendered to you, be it commissions for sales, client winning or any other method.



Must I pay employees the minimum salary even if employees work less time than the law authorized work schedule?

The work schedule provided by law is the maximum time the employee must work for you, but the salary provided by law is the minimum that employee is entitled to receive. In industrial, commercial or services provider companies and in the case of those companies that provide guard services, partial time work is allowed; this means that you and your employee may agree on a work schedule under or equal to 29 weekly hours and, consequently, shall be paid for the time effectively worked. The calculation is done by dividing the national minimum salary by 23.83 and the result is divided by eight, this shows the value of the work hour. In the event your employee works on a work schedule above 29 hours, you must pay employee the legally established minimum salary, in full.



Can I honor my employees' salary in US Dollars? If affirmative, could I pay them the equivalent in local currency?

According with the law, you must pay salaries in local currency, the Dominican peso. However, there are no provisions in the Labor Law about a fine being imposed for paying salaries in a different currency other than the peso.



SUPENSION OF THE EFFECTS OF LABOR AGREEMENTS

What is the rest period I have to grant to my female employee in case of pregnancy? What other benefits must I recognize during the time of her pregnancy and by the time she comes back to work?

You must grant your pregnant female employee a rest period of six weeks prior to the delivery date and six weeks thereafter. The pregnant employee may accumulate her pre-birth rest period to enjoy it together with her post-birth rest period. During pregnancy you must pay your employee her ordinary salary as well as during her pre-birth and post-birth periods when she is not protected by the Social Security laws. In the event she is protected therein, you must pay her 50% of her ordinary salary and the Social Securities Institute assumes the remaining 50%.

When employee returns to her work after delivery, you must grant her three rest periods of 20 minutes each, at least, so that she can nurse her child or, at the preference of the employee, to accumulate these rest periods for the end of the daily work schedule. These rest periods are granted for a term of twelve months.


Under what circumstances can I suspend the effects of the labor agreements with my employees? What are my obligations in such events?

You may suspend the labor agreements with you employees for lack or insufficiency of raw material, lack of funding to continue the regular works, production excess, impossibility to provide funds toward financing the company’s costs, and due to labor strikes. For the suspension to be legal you must request the corresponding authorization from the State Labor Secretary's Office within the following three days from the date of the start of the suspension and that it gets approval therein. During a legal suspension of the effects of labor agreements you are free from paying salaries to your employees.



Must I pay employee the salaries for all the duration of an illness or accident disability?

When your employee is disabled for illness or has a labor-related accident, the Managing Office or Labor Risks pays the employee a daily or weekly subsidy as of the fourth day of the occurrence of the disability and for a period of time up to fifty two weeks which is considered as a temporary disability. If within the thirty days prior to the end of this temporary disability employee has not yet recovered, an Assessment Body recommended by the Managing Office of Labor Risks shall certify the degree of disability of the employee and consequently, it will establish in favor of employee, an indemnification or monthly pension and the Managing Office of Labor Risks will be responsible for the payment thereof.

In the event you did not insure your employee accordingly, you will have to pay employee an amount corresponding to the full salary during a term of one year and, in addition, to assume all medical expenses incurred due to the illness or accident suffered.



LABOR AGREEMENT TERMINATION


Can I dismiss a pregnant employee? What procedures should I use for that purpose?

You cannot dismiss a pregnant employee nor can you dismiss her for a period of six months following birth without previously having submitted the issue to the State Secretary Office of Labor, who will determine whether there is justified cause for the dismissal. If you dismiss this employee without complying with this prior requirement or, if the State Secretary Office of Labor determines that this dismissal was carried out due to employee's pregnancy or delivery, you are obligated to maintain employee in her work position.


For what justified causes can I dismiss my employee?

You may dismiss your employee for justified cause upon a fault incurred by employee of those provided for in Section 88 of the Labor Code.


What should I pay to the employee that resigns to his work position?

In case of resignation of the employee, understood as the termination of the labor relationship by the personal will of employee, as long as employee does not allege a cause inherent to you, you will only have to pay employee's vested rights, meaning the Christmas proportional salary according with the number of months worked and the compensation vacations not enjoyed. Similarly you will to recognize employee's participation on the profits of the company, in case this form of remuneration was agreed upon between employer and employee.

In case that the resignation of employee is due to any one justifiable cause for resignation provided for in Section 97 of the Labor Code, you will have to pay employee the following: omission of pre-notice, severance pay, Christmas proportional salary, vacations not enjoyed and employee's participation of salaries and profits of the company.


When do I have to pay the Christmas salary to an employee in case of termination of the labor agreement?

In conformity with the law, you must pay the christmas salary to the worker on December the 20th., of the correspondent year. Nevertheless, in case that the working relationship ends up, if you prefer, you can make the payment of above fringe benefit immediately.


Must I pay every year a participation for the benefits to my workers?

Yes, you must pay annually the participation for the benefits of the interprise to your workers for an indefinite time, in the 90 to 120 days of the fiscal year of your enterprise. If you have not obtained benefits in your commercial operations, you do not have the obligation to pay the participation in the benefits of the enterprise to your workers.



Under which conditions must I pay an economic assistance to the worker?

After three months of service, you must pay an economic assistance to your worker when the contract finishes, due to the impossibility of execution, fortuitious case, or force majeure. The economic assistance is the compensation provided by the law for the termination of the working contract, for the impossibility of the execution of the contract, due to causes foreign to the will of the worker and the employer.

It proceeds the payment of the economic assistance when the working contract ends up:

  • For the death of the employer or his physical or mental disability, always when it has as a consequence the termination of the business.
  • In virtue of the workers death, or his physical or mental disability, to perform the services he is obliged to render.
  • Due to the worker’s disease or absence, accomplishment of legal obligations which avoid him to render services, or any other justified cause which has obstruct him to concur to his tasks, for a total period of one year, since the day of his first absence.
  • Due to exhaustion of raw material, object of an extractive industry.
  • Due to bankruptcy of the enterprise, always when it totally ceases the exploitation of the business, or due to its closing, or definitive reduction of its personnel, resulting from the lack of elements to continue the exploitation, high cost of same, or any other similar cause, with the approval of the Department of Work.

The amount of the economic assistance is equivalent to:

  • Five days of salary, when the working salary has had a duration of not less than three months nor more than six months.
  • Ten days of salary, when the working contract has had a duration of not less than six months nor more than one year.
  • Fifteen days of ordinary salary, for every year of service rendered, when the duration of the working contract is equal or higher than one year.


At the end of the contract for determined work and service, or during a certain period of time, should I pay working fringe benefits to the worker?

No, in the contract for a determined work and service, you do not have to pay working fringe benefits to your workers, only acquired rights (vacations and christmas salary). In the case of contracts for a certain time, if the duration of this is of not more than three months, at the end you must pay him an amount for severance payment. In case the contract would reach to five months, you must pay him for the non-enjoyed vacations. In all the cases, you must pay the worker a christmas salary.


Dismissal and discharge are the same thing?

No, dismissal and discharge are different.

The dismissal is the termination of the working contract by the employer’s will, as a consequence of a failure committed by the worker of the ones mentioned in article 88 of the Code of Work.

The dismissal is justified when is verified the existence of its fair cause, this is, the failure committed by the worker. In this case, it corresponds only the payment on behalf of the worker of the non-enjoyed vacations, if the contract has five months or more, christmas salary and participation in the benefits.

The dismissal is not justified when it is not verified the failure committed by the worker, or when the employer, even when he verifies the failure, do not accomplish with the formality to communicate to the working authority in the following 48 hours, the justified dismissal. In this case it corresponds the payment on behalf of the worker of the indemnification, due to omission of notice of termination of employment, severance payment, non-enjoyed vacation, if the contract has five months or more, christmas salary and participation in the benefits of the enterprise.

Discharge is the right you and also the worker have, to end up the working contract, without any cause, in conformity to article 75 of the Code of Work. In this case, it corresponds the payment on behalf on the worker of an indemnification due to omission of notice of termination of employment, it the contract has three months or more, non-enjoyed vacations if the contract has five months or more, christmas salary and participation in the benefits of the enterprise, as well as the equivalent to one day of ordinary salary. The payments due to omission of notice of termination of employment and severance payment, must be payed by the employer to the worker in a maximum term of ten days, counted as of the date in which the employer finished the contract by discharge to the worker. In case of not doing it within this term, he must pay the worker, further than the fringe benefit and rights corresponding him, the equivalent to one day of ordinary salary for every day of delay in the payment. If in the case of the discharge, the employer has given a previous advise to the worker with the advance established by the law, the payment of the indemnification due to omission of notice of termination of employment is excluded.

 

WORKING RISKS


Which working risks are covered by the insurance? Which are not covered?

The Insurance against working risks covers the following risks:

• Corporal injured and morbid status suffered by the worker or learner as a consequence of the work he performs.

• Injures of the worker during the time and in the place of work, except a proof on the contrary.

• Working accident occurred to the worker, in connection or as a consequence of the tasks requested him by you, even when these work might be different from the professional category of the worker.

• Accident occurred in acts of salvage and in other acts of similar nature, when ones and others have a connection with the work.

• Accident of transit within the route and normal working journey.

• Diseases which direct cause comes from the practice of the profession or the work, performed by the worker and which occasions him a disability or death.


The insurance against working risks does not cover the following risks:

• The state of drunkenness in which the worker might be or under the action of any psychotropic, narcotic or enervanting drug, except by a medical prescription.

• The result of an intentional damage of the same worker, or in accordance with you or any other person.

• Force majeure foreign to the work.

• Accident of transit outside the route and the normal working journey.

• Damages due to deceit or a temerarious imprudence of the injured worker.


What is considered as a professional disease?

It is considered as a professional or occasional dosease, the one contracted by the worker and which occasions him disability or death, as a consequence of the work he performs on the account on the employer, and resulting as a consequence of risk factors and conditions existing in his office and occupation.


Which consequences can derive in virtue of not ensuring my workers against working risks? Am I always obliged to do it?

You are obliged to inscribe your workers in the insurance against working risks, and in case of not doing it, you must cover all the medical expenses incurred by the worker in case of an accident or disease, as well as to civilly indemnify him for the damages and prejudice caused him by the lack of inscription in the insurance against working risks.

 

SYNDICATION FREEDOM


Which practices forbids me the law to perform, which could be considered as contrary to the purposes of the syndicate?

The law forbids you to perform the following activities in virtue to consider them contrary to the syndical freedom:

• Demand your workers or persons to abstain of forming part of a syndicate.

• Exercise retaliations against your workers in virtue of their syndical activities.

• Dismiss or suspend your worker for belonging to a syndicate.

• Deny yourself to establish, without a justified cause, negotiations for the celebration of collective agreements of working conditions.

• Intervene in any manner in the creation or administration of a syndicate of workers, or support it through financial means or means of any other nature.

• Deny yourself to treat with the legitimate representatives of the workers.

• To use the force, violence, intimidation or menace or any other form of coercion against your workers or syndicates of workers, with the objective to avoid or obstaculize the exercise of the rights consacrated by the laws on behalf of same.


COLLECTIVE NEGOTIATION

Am I obliged to pact a collective agreement proposed by the syndicate?

You cannot deny yourself to pact a collective agreement of working conditions with the syndicate of workers of your enterprise; in case to do it, your negative will be considered as a practice contrary to the syndicate activity. Now, you can request the Working Secretariat of State, the suspension of the negotiations due to a fortuitious case or force majeure, high cost or another economic cause, in order that the Department of Work dictates a resolution.


Which is the maximum duration of a collective agreement?

The maximum duration of a collective agreement is of three years. If the agreement does not express the time of its duration, it is considered as pacted for one year.

 

COLLECTIVE CONFLICTS



My workers have started a strike, what should I do?

You must verify that the strike your workers have initiated accomplishes with the following requirements:

• That its object is the solution of a conflict which affects the collective interest.

• That the conflict has been previously submitted to the procedure of administrative conciliation without having reached to an agreement.

• That you or your worker have not designed referees in the following three days to have finished the intention of administrative conciliation.

• That it does not affects essential services.

• That it does not violate the provisions of the Constitution of the Republic, nor it affects the national security, the public order, rights and freedom.

• That it does not bear act of physical or moral violence over persons or things, sequestration of persons or goods, undue use of equipments and facilities of your enterprise.

• That it has been approved for more than 51% of the workers of your enterprise.

• That it has been previously notified in written to the Working Secretariat of State.

In case that the syndicate does not accomplish with the requirements before indicated, you can submit the matter to the Court of Work of your place to decide about the legality or illegality of the strike.

 
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