Venezuela, officially known as the Bolivarian Republic of Venezuela, is strategically situated in northern South America. The country offers easy access to a huge customer base of 28 million to the companies establishing their business here.
With a growing literacy rate of 99.14% in 2021, Venezuela has to offer highly skilled and talented employees. However, companies need to comply with the national employment act and labor laws while hiring. Read this guide to understand how to hire in Venezuela.
Things to Know Before Hiring in Venezuela
To carry out recruitment and selection in Venezuela, employers must be aware of the following things:
- Although employment contracts are not mandated in Venezuela, employers should have an employment contract signed before hiring in Venezuela.
- The employee and employer should sign two copies when creating a written agreement. One should be handed over to the employee, and the employer should retain the other.
- The agreement should contain certain information, such as the employee’s personal details such as their name, nationality, marital status, address, and Venezuelan Identification Number.
- The contract must also include the employer’s details, such as the corporate and representative’s names and addresses.
- The agreement should also describe the scope and location of the work, the start date and type of employment contract, the working hours and compensation, any collective bargaining agreements that apply, and the duration of the employment contract.
- The employer must record when the contract was signed to avoid disputes.
- It is legal for employers in Venezuela to make employees serve a probationary period if mentioned in the employment contract.
- Probationary periods can only be applied to contracts without a set end date and cannot exceed one month.
- During this period, either party can end the employment without giving any prior notice.
- Employers must follow standard work timings to hire staff in Venezuela.
- The work timing is 8 hours a day or 40 hours a week during daytime shifts between 5 am and 7 pm.
- The work week includes five days a week.
- Employees can work up to 10 hours per day or 100 hours per year, including overtime.
- Employees working overtime must be paid a minimum surcharge of 50% over the regular salary for the equivalent ordinary shift.
- Employees in Venezuela are entitled to three paid sick leaves.
- Employees can take leave due to illnesses or injuries for 12 months.
- The employee must present a medical certificate to the employer as proof of their absence within 48 hours of taking leave to avail of this benefit.
- If an employee needs to take sick leave for four or more days, they can receive compensation from Social Security for up to 52 weeks. The compensation amount will be 66.7% of their salary.
- Pregnant employees can take 26 weeks of maternity leave.
- This leave is divided into two parts which they can take up to 6 weeks before the birth and 20 weeks after the child’s birth.
- Employees on maternity leave can get their salary paid at a reduced rate of 66.6% by the social security administration.
- In Venezuela, fathers are entitled to one week of paid paternity leave after child’s birth.
- The paternity leave can be taken within 30 days after the child’s birth.
- During these days, the employer must pay the father the regular salary.
- Before recruiting in Venezuela, employers must remember that employees are eligible for 15 paid vacation days after completing one year of continuous service.
- Each year of service, they are entitled to one additional vacation, up to 30 working days per year.
- Employees also receive a vacation bonus during their vacation period, equivalent to 15 days of salary.
Following are the public holidays offered to employees in the Bolivarian Republic of Venezuela:
- New Year’s Day
- Monday and Tuesday of Carnival
- Labor Day
- Declaration of Independence Day
- Independence Day
- Battle of Carabobo
- Birth of Simon Bolivar
- Day of Indigenous Resistance
Social security contributions
Employers and employees are liable to make the following social security contributions:
Type of contribution
Contribution of employee
Contribution of employer
Employment Benefit Regime Contribution
Mandatory Social Security Regime Contribution
9.10 to 11%
Workplace Prevention, Conditions, and Environment Contribution (LOPCYMAT)
Employee Training Contribution (INCES)
Housing Regime Contribution
Personal income tax
Here is a table of taxable income ranges and the percentage of taxes levied against each bracket of income in the Bolivarian Republic of Venezuela-
Rate of tax
6000 TU and above
Termination of contracts
- In the Bolivarian Republic of Venezuela, employers cannot dismiss an employee working on indefinite-term contracts from service.
- To do this, the employer must seek prior authorization from the Labor Ministry.
- The Labor Ministry only grants authorization for dismissal in severe cases of misconduct or insubordination.
- Employers usually arrive at a mutual agreement with employees to end the employment contract.
- Employers in the Bolivarian Republic of Venezuela have to give employees severance pay upon termination of their employment, regardless of the reason for termination.
- To ensure severance pay, employers must make quarterly deposits into a bank trust or their accounting, equivalent to 15 days of pay per quarter.
- This will amount to 60 days of pay per year based on the employee’s salary at the time of each deposit, plus an additional two days per year of seniority, up to 90 days.
- Severance pay will be paid within five days of the contract’s termination date.
The Cost of Hiring an Employee in Venezuela
The cost of hiring in Venezuela can vary depending on the industry, salary, and benefits. Here are the costs associated with hiring in Venezuela:
- Employers might have to run ads on different social media platforms, which may cost them money. However, this cost is variable.
- Companies can also conduct background checks in the country while hiring to avoid faulty and unsuitable candidates.
- After hiring in the Bolivarian Republic of Venezuela, employers must contribute to the social security system, which covers health care, pensions, and other benefits.
- Employers also have to pay their employees the minimum wages as prescribed by law. The minimum wage in Venezuela is 130 VES per month, but it can increase depending on the position held by the employee.
- Employers must consider other expenses, such as overtime pay while hiring employees.
- There are also various kinds of taxes like VAT, income tax, and corporate tax employers must pay in Venezuela.
What Does a Company Need to Hire Employees in Venezuela?
To be able to make recruitments in the Bolivarian Republic of Venezuela, companies must have the following prerequisites:
- Employers first need to have a company and register it with the concerned authorities.
- Understand the prevailing labor laws and norms.
- The company must also contribute to social security and maintain all safety standards before hiring employees.
- Get an employment contract signed by the employee before the appointment to avoid many legal risks and liabilities.
Various Options for Hiring Employees in Venezuela
There are several ways of hiring in Venezuela, which is as follows:
- Job portals & social media: Companies can post job openings on their company pages or join local groups and communities to connect with potential candidates or run ads. You can also hire people in Venezuela via job portals. There are also many national job portals where companies will find job candidates. They can directly connect to them via such portals and hire.
- Referrals: Companies can leverage their networks to find qualified candidates through employee referrals or by contacting industry contacts.
- EOR platforms: An EOR (Employer of Record) platform is a type of service that enables companies to hire and manage remote workers or contractors through a third-party provider. With an EOR platform, the provider becomes the legal employer of the worker, handling tasks such as payroll, taxes, and benefits administration. With an EOR platform like Multiplier, businesses easily hire employees compliantly.
The Steps to Hiring in Venezuela
The recruitment process in Venezuela involves a lot of hard work. Here is an account of the hiring process in the Bolivarian Republic of Venezuela in a few steps:
- Step 1: Develop a job description: As a company, to hire people in Venezuela, you should create a job description that outlines the job roles and qualifications necessary for bagging the job.
- Step 2: Post the job opening: The job opening can be posted on local job portals or social media portals like LinkedIn.
- Step 3: Interview candidates: Once applications have been received, the company can conduct interviews to assess the candidates’ qualifications and fit for the role.
- Step 4: Make a job offer: Filter out the candidates suitable for your company and make a job offer via email or letters.
- Step 5: Sign the employment contract: Once the candidate accepts the job offer, the company should sign an employment contract with the employee. The contract should include details such as compensation, benefits, working hours, and termination clauses, along with the name of the company and its details.
- Step 6: Enroll with social security: The company must register the employee with the Venezuelan social security system of the Bolivarian Republic of Venezuela within the first three days of employment. This system is the “Instituto Venezolano de los Seguros Sociales” (IVSS).
Let Multiplier Be Your EOR Platform in Venezuela
Meeting the compliance requirements of another country takes time and effort. This is where a competent EOR platform like Multiplier can solve business problems. If you are a company aiming to establish your business in a foreign land smoothly, Multiplier can be your ultimate solution!
We are a pioneer with local business activities spread across 150 countries. Our seamless employee onboarding facilities and compliant employment contracts give your employees a hassle-free recruitment experience.