G-P’s Employer of Record (EOR) model allows your company to start hiring talent in minutes via our global entity infrastructure. Unlike a Professional Employer Organization (PEO), G-P allows your company to expand your global footprint without the hassle of entity setup and management.
Our global employment products, including G-P Meridian Prime™ and G-P Meridian Core™, are backed by the largest team of HR and legal experts in the industry. We handle the growing complexities of compliant global expansion — so you can focus on opportunities ahead.
As a global EOR expert, we manage payroll, employment contract best practices, statutory and market norm benefits, employee expenses, as well as severance and termination. You’ll have peace of mind knowing you have a team of dedicated employment experts assisting with every hire. G-P allows you to harness the talent of the brightest people in 180+ countries around the world, quickly and easily.
Hiring in Guatemala
Guatemala is in Central America and borders both the Pacific Ocean and the Caribbean Sea and has the largest population of any Central American country.
When negotiating terms of an employment contract and offer letter with an employee in Guatemala, it may be useful to keep the following in mind.
Employment contracts in Guatemala
Employment contracts may be for fixed or indefinite terms. It’s legally required to put the employment contract in writing and to produce 3 copies. Each party retains 1 copy, and the remaining one must be delivered to the Directorate General of Labor within 15 days.
The employment contract should be in the local language, and spell out the terms of the employee’s compensation, benefits, and termination requirements. An offer letter and employment contract in Guatemala should always state the salary and any compensation amounts in quetzals rather than another currency.
Working hours in Guatemala
The workday in Guatemala may not exceed 8 hours per day, nor exceed a total of 48 hours per week. Overtime should be paid at a rate of 150% the usual wage. Under no circumstances can an employee be required to work more than 12 hours in a day.
Holidays in Guatemala
Guatemala celebrates 13 national holidays:
- New Year’s Day
- New Year’s Eve
- Maundy Thursday
- Good Friday
- Holy Saturday
- Labour Day
- Army Day
- Assumption Day
- Independence Day
- Revolution Day
- All Saints’ Day
- Christmas Eve (half day)
- Christmas
Vacation days in Guatemala
Employees are generally entitled to 15 days of paid annual leave after working for at least 150 days. Vacations should be paid in advance.
Guatemala sick leave
Employees are entitled to 5 days of paid sick leave.
Maternity/paternity leave in Guatemala
Expecting employees are generally entitled to 12 weeks of paid maternity leave.
Fathers are entitled to 2 days of paid paternity leave.
Health insurance in Guatemala
Guatemala has a public/private healthcare system.
Bonuses
Employees are generally eligible for the following bonuses:
- 13-month bonus: Annual bonus that is equal to 1 month of regular salary for Christmas and New Year’s
- 14-month bonus: Annual bonus of 1 month of regular salary paid in July
Termination/severance in Guatemala
The first 2 months of an indefinite contract are considered probationary.
When terminating an employee, employers must pay:
- Any salary owed up to the date of dismissal
- The proportional year-end bonus
- Applicable proportion of annual bonus
- Proportional amount of vacation owed
If the employee was terminated without just cause, severance pay may also be owed equal to 1 month’s salary for each year they worked for the company.
Paying taxes in Guatemala
Employers contribute 12.67% of wages to social security, and employees contribute 4.83%.
Why G-P?
At G-P, we help companies unlock the power of the everywhere workforce through our industry-leading Global Growth Platform™. Let us handle the complex and costly tasks involved in finding, hiring, onboarding, and paying your team members, anywhere in the world, with the speed and guaranteed global compliance your business needs.
Contact us today to learn more.