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Chilean Senate Approves Law Regulating Work Contracts

By the Auxadi Global Payroll Team

After years of deliberation, the Chilean Senate has decided to approve a bill that modifies the legislation on labor contracts. These contracts are considered “work contracts,” which recognize workers employed as contractors.

The initiative incorporates a legal definition of the term “work contract.”

Previously, there was no systematic regulation in the labor law. It is also important to note that any worker who is employed under one or more contracts for more than one year or more than 240 days will be entitled to compensation for their service. Employees would receive 2.5 days of compensation for each month worked.

The approval of this initiative will allow employees to remain affiliated to the public health system of Chile when the worker has been paid through contract employment for at least four months of the year. Workers under contract also have the right to annual holiday time off (vacation).

These rules went into effect January 1.

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Auxadi provides International expansion services under a single IT platform as One-Stop-Shop solution in accounting, tax compliance and payroll. From its HUBS in Chicago & Madrid, with over 40 years of experience, 250 employees, 10 intl offices, its Intl Desks and its cloud platform, Auxadi helps more than 1000 US & European corporations expanding abroad.