ExpatriatE Law in LatiN america 6 KEy QuEstioNs to CoNsidEr
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1 Expatriate Law IN LATIN AMERICA 6 Key Questions to Consider
2 What are the main laws or regulations in your jurisdiction relating to foreign workers In your jurisdiction, do foreign workers have to enter into an employment contract in the host country or can their services be governed by an employment contract executed in another country LAWS & REGULATIONS HOST COUNTRY OTHER COUNTRY Immigration Law & Decree number 616/2010 create the main legal framework for foreign workers. Other important regulations include: DNM Regulation 1170/2010 and 1171/2011. Law No. 6,815/1980, Brazilian Labor Code Decree No. 5, 452/1943, and National Immigration Council s Normative Resolutions establishing rules for different visa categories. Decree Law (July 19, 1975), Supreme Decree 597 (June 14, 1984) and Article 19 of the Labor Code. The n Labor Code ( Código Sustantivo de Trabajo ), and amendements (Law 50 of 1990 and Law 789 of 2002). Employer employee relations are also governed by Law 100 of 1993 (which consequently also regulates the Social Security System), as subsequently amended by Law 797 of 2003 and Law 1122 of Foreign workers are subject to the same regulations provided for local employees, with the sole exception of the immigration obligations that must be complied with in any case. The Mexican Federal Labor Law, Chapter III (Art ); the Social Security Law, Chapter II (Art ). Likewise, there are accessory administrative-law regulations that are applicable to immigration proceedings and which govern rules of procedure. The Labor Code, Executive Decrees 17 (1999), 107A (2011), 140 (2012) and (2013). The Foreigners Law, approved by Legislative Decree N. 703, and the Regulations approved by Supreme Decree N TR. For migratory purposes the Unique Text of Administrative Procedures of the Migratory Authority is applicable. The general rule is that the foreigners have to be employed by a local legal entity. In some extraordinary circumstances (professional or technical visas and personnel transferred by an international company to an Argentinean branch) and for fixed term periods, foreigners can work through a non- Argentinean company. Depends on the visa type: A temporary visa requires a local contract. A technical assistance visa, under Resolutions 61/2004 and 100/2013, requires an employee to remain under a foreign employment contract or possess dual contracts (local and foreign). n labor laws are ruled by a principle of territoriality in virtue of which every employment relationship developed in n territory will be subject to n labor laws. Therefore, every foreign employer rendering services should enter into an employment contract in. If a foreigner will not receive any salary or benefits in Mexico then there is no need to sign a local employment agreement. The labor relationship is governed by the offer or assignment letter provided by the country or origin. Pursuant to the Labor Code all foreign workers have to enter into an employment contract in Panama. Foreign workers that enter Peru with the purpose of rendering services to a Peruvian Company must have a labor agreement previously approved by the Peruvian Labor Ministry. It is important to note that the labor agreement could be signed in Peru or in the foreign country, but it must contain all the dispositions established by Peruvian labor law. Workers of foreign companies that enter Peru without a residence intention and for a specific period of time do not need a Peruvian labor agreement. Depends on the visa type: An Employment Contract Visa requires foreigners to enter into an employment contract with an employer, who must be a natural or juridical person with legal domicile in Chile. A Temporary Visa is a residence visa that can be given those who are going to perform activities in a Chilean company but will be paid abroad.
3 Can foreign workers receive their salary in foreign currency and/or in another country In your jurisdiction, are there any specific laws or regulations regarding pensions, healthcare and social security obligations for foreign workers PENSION SOCIAL SECURITY YES The general rule is that foreigners employed in have to receive their salary in and in local currency. However, if the Argentinean employer has foreign currency in reserve, that currency can be freely disposed of and therefore the salary can be paid in that currency. A A If the employee has been transferred to an Argentinean branch of the same company, his salary can be paid in his home country for a period of one year. Any worker under an employment agreement in Brazil can only be paid in local currency. However, dual employment agreements allow for split payroll. The salary can be agreed in foreign currency, but it must be paid in Chilean Pesos in the equivalent amount of the foreign currency at the payment date. The remunerations can be paid abroad if such payment it is expressly requested by the employee and such agreement is reflected in the employment contract. In any case, the employer will have to fulfill all the social security and tax obligations in connection with the employee s salary. A company would be able to pay in foreign currency to the foreign worker as long as he is not considered a foreign exchange resident (no more than 180 days of stay in within one year). Once the worker is considered a n resident, all payments must be made in n pesos. It can be agreed by the parties that salary will be paid in local, foreign currency or even in a bank account outside of Mexico. Foreign workers must receive their salary in Balboas. Given the absence of Balboa bills, US dollar bills are used as legal currency. Technically, the worker must receive their salary in Panama. Nevertheless, it is customary to pay part of the salary in Panama and part outside of Panama. If a foreign worker gives his authorization, he can receive his salary in foreign currency or in a foreign bank account. Foreign workers in Brazil must register with the National Social Security Institute (INSS) (for public health services and pension). An employee contributes 8-11% of his salary up to a maximum, and an employer pays 20% of payroll and fringe benefits. Employers must guarantee medical costs of foreign worker during their stay in Brazil. Although regulations for health and professional risk systems are the same for foreign employees and local employees, there are special regulations for foreign employees regarding pensions. Foreign employees that are registered and covered by a pension system in another country are not obliged to pay contributions to the pension system in. YES YES Law N , exempts employers from fulfilling the social security laws with respect to foreign technical personnel that enter into employment contracts, provided they meet the following requirements: a) The foreign employee must be a technician, or professional ; b) The employee has to be affiliated to a social security regime outside Chile that provides benefits, at least, in case of sickness, disability, old age and death; c) In the employment contract the foreign employee must mention his will to maintain the respective affiliation to the social security regime in his country of origin. The laws and regulations regarding pensions, healthcare and social security obligations are equal for foreigners and locals employees. There are some bilateral social security agreements that credit or compensate social security payments made in different countries. There is also a multilateral social security agreement between Mercosur partners. Any person under a local Mexican Employment Agreement regardless of their nationality is entitled to enjoy the minimum labor and employment benefits granted by Mexican Labor law, which includes the right to enjoy the benefits of Mexican Social Security. Mexican Social Security benefits include old age retirement pension, healthcare and medical insurance. There are no specific laws or regulations for foreign workers regarding pensions, healthcare or social security obligations. In the case of foreign workers, general labor law will be applicable. Foreign workers must become affiliated with the Social Security Institute through their employer. Moreover, the Social Security Institute manages the social security system of Panama, which covers health, maternity leave, disability, retirement pensions and deaths (not originating on the job).
4 In your jurisdiction what type of permit does a foreign employee need to obtain to render services Is there a possibility to ask for a work visa once a person is in the host country or does it have to be obtained before the person arrives HOME ADMIN HOST fter A Before fter A Before A working visa is required for any foreign national to work in. There is a simplified procedure for citizens from Mercosur countries. Business Visas (Section 24 Clause H Law and NDM Regulation 1171/2010) and Professional and technical visas (Section 24 Clause H Law and NDM Regulation 1170/2010) are two specific types of work visas issued to foreigners. Temporary visas and permanent visas can be issued to foreigner workers. Temporary visas can be issued for the transfer of technical knowledge and provision of technical services for a short or long period; for working on ships and maritime platforms; for foreigners employed by Brazilian multi-nationals or by a foreign entity for professional training at a Brazilian branch, subsidiary or headquarters of an entity belonging to the same economic group Permanent Visas can be issued for foreign administrators, managers, directors, and executives; for foreigners who represent financial institutions based abroad; for foreigners appointed to manage non-profit organizations; for individual foreign investors. The work documents allowing foreigners to perform a labor activity in Chile are: Permission to Work with a Tourist Visa; an Employment Contract Visa; a Temporary Visa. Under n laws, a foreign employee needs 2 permits to render services in : a Work Visa and a Professional Permit from a Professional Council (depending on the profession and services provided). There are three kinds of documents that the Immigration Office has authority to issue to a foreigner in order to render services in Mexico: Temporary Resident card with permission to participate in gainful activities; Temporary Resident card with no permission to participate in gainful activities; Permanent Resident Card. All foreigners who wish to work in Panama must obtain a work permit form the Ministry of Labor and Work Development. The Labor Code stipulates that each employer can hire ordinary foreign personnel in a proportion of no more than 10% of his regular labor force. The employer can, however, employ foreign specialized or technical personnel that do not exceed 15% of the position in the total labor force. If a foreigner wishes to start rendering services for a Peruvian company and receiving remuneration, he needs to obtain a work visa from the Migratory Authority. Once the work visa is obtained, the migratory authority will grant a foreign card. If a foreigner enters to Peru as an employee of a foreign company assigned by their foreign employer for a specific term of time, a temporary visa will be granted. The migratory authority usually grants this kind of visa for a period of six (6) months, which can be extended. The visa is stamped on the passport. No foreign card is granted. The future employee could enter the country with a tourist visa and apply for a working visa at the National Direction of Migration during his stay in. Citizens from, Uruguay or Paraguay, Chile, Bolivia, Peru and, (Mercosur or Associated States to the Mercosur) are allowed to request a temporary residency up to two years upon arrival in Brazil. Citizens from other nationalities may have the Brazilian entity sponsor a visa application while they are in Brazil, as tourists or as business visitors, however are prohibited to work during the process. They will be required to collect the visa at a Brazilian Consulate outside of Brazil once approved. Either the Employment Contract Visa or the Temporary Visa application can be filed in: abroad, in the Chilean Consulate from the country of the person who requests the visa; or in the Foreigners Department of the Chilean Home Office ( Departamento de Extranjería del Ministerio del Interior ) in Chile (after the applicant s arrival as a Tourist). fter A Before fter A Before fter A Before Employees who are nationals from countries that belong to the Andean Community (CAN) (Peru, Ecuador, Bolivia and ) need a Work Visa, but they can apply for it once they are in. All other foreigners must obtain the Work Visa at a n Consulate before arriving in. Regardless of the type of document needed, proceedings should be initiated prior to the foreigner s arrival in the country, as the Consular interview constitutes a crucial step for the obtaining of the Resident Card. In the event that the foreigner already has a Temporary Resident status with no permission to participate in gainful activities, he would be entitled to request a work permit and modify the non-gainful status for a gainful one. This procedure can be initiated while the foreigner is in Mexico. A foreigner may enter the country under a tourist visa, which grants a stay of six months. During this period of time, a work permit can be requested. fter A Before fter A Before A foreigner can request a work visa in his home country, or once he arrives in Peru. However, a foreigner will only be able to begin working once he obtains the work visa.
5 GLOBAL REACH LATIN AMERICA ARGENTINA Funes de Rioja & Asociados Av. Eduardo Madero 942 C1106ACW Ciudad Autónoma de Buenos Aires, T E estudio@funes.com.ar COLOMBIA Brigard & Urrutia Calle 70A N Bogotá - T F E servicioalcliente@bu.com.co csantos@bu.com.co Veirano Advogados Av. Presidente Wilson, º floor Rio de Janeiro RJ Brazil T F E luiz.migliora@veirano.com.br Philippi, Yrarrázaval, Pulido & Brunner El Golf 40 piso 20 Las Condes Santiago C.P Chile T F E philippi@philippi.cl Basham, Ringe y Correa S.C. Paseo de los Tamarindos N. 400 Floor 9 Bosques de las Lomas México, D.F. Mexico T F E basham@basham.com.mx jorgedepresno@basham.com.mx Arosemena Noriega & Contreras Tower Financial Center, 16th Floor 50th Street and Elvira Mendez P.O. Box Panama, Republic of Panama T F E anc@anorco.com.pa Estudio Olaechea Bernardo Monteagudo 201, San Isidro Lima 27, Peru T F E postmaster@esola.com.pe
6 Ius Laboris Knowledge Base Visit our innovative online platform providing international employers with a single point of reference for global HR law. Ius Laboris Knowledge Base Boulevard du Souverain, 1160 Brussels - Belgium Tel: Fax: info@iuslaboris.com Copyright Ius Laboris 2013
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