Work and Wages

Minimum Wage

The Chilean Constitution allows the President to legislate on determining the minimum wage and its increases for the private sector workers. In accordance with the labour code, minimum wage is the lowest monthly amount a worker may receive for his/her work. For part time workers, their wages must be proportional to the minimum wage. Wages may be determined per unit of time (hour, day, week, fortnight or a month) or by piece or work. Wages can also be determined through collective bargaining agreements but they cannot be less than the national minimum wage rates. Minimum wage is set by the Chilean government through a Decree. However, in practice, the government decision is based on the recommendations of a Committee composed of worker, employer and government representatives. The minimum wage in Chile differs on the basis of age and paid or unpaid remunerative activity. There is no sectoral, occupational or regional minimum wage in Chile. Labour code or Constitution does not specify the criteria that should be taken into account while determining minimum wage rates.

Remuneration for apprentices is freely organized by the parties and may be fixed as an amount under the minimum wage rate.

Compliance with minimum wage along with other provisions of Labour Code is ensured by the Labour Inspectorate, part of the Labour Directorate, which works under the Ministry of Labour and Social Welfare. A labour inspector may impose fines on infringement of labour code provisions including minimum wages.  

Source: §65(4) of the Constitution of Chile 1980 with amendments through 2014; §41-44 & 81 of the Labour Code 2002; §1 of the Law No. 20.689 on Resetting the Monthly Minimum Wage

Regular Pay

Wages means the consideration in cash and in kind to be paid to the employee by the employer according to the employment contract, excluding meal, transportation and travel allowances, family benefits, etc. It may constitute the following:

a)      Salary, or basic salary;

b)      bonus, which consists of the remuneration of overtime work;

c)      commission, which is the percentage of the sales or purchase price , or the amount for other operations, the employer conducted in collaboration with the worker;

d)      participation, which is the share in the profits of a particular business or enterprise or just the one or more sections or branches thereof; and

e)      gratification, paid by the employer to the worker for good work

The remuneration may be fixed per unit of time, day, week, fortnight or month or by the piece, measure or work. In any case, the unit of time may not exceed one month (payment interval). The monthly amount of the salary may not be lower than the minimum wage rate established by the law. For part time workers, their wages must not be less than the minimum when calculated proportionally.

Salaries must be paid in legal tender either by cheque or bank deposit. However, expatriate employees may be paid in foreign currency. The employer must provide payment slip to the worker which states the amount paid in the manner as determined and deductions made. Remuneration must be paid on a working day, from Monday to Friday, in the place where the worker provides services and within one hour of completion of the work. The parties may agree on other days or hours of payment.

In kind allowances are permitted but only as an increase of the remuneration in cash.

Source: §41-45, 54-56 & 151 of the Labour Code 2002

Regulations on Work and Wages

  • Código Laboral, 2013 (Código de Trabajo 2013) / Labour Code, 2013
  • Ley N º 20.689 sobre cómo restablecer el Salario Mínimo Mensual / Law No. 20.689 on Resetting the Monthly Minimum Wage
  • Constitución Política de 1980 (Ultima actualización de la Constitución: Ley Nº 20.748, del 3 de mayo de 2014) / Political Constitution of Chile of 1980 (last amended in 2014)

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