Minimum Wage in Nicaragua - Frequently Asked Questions

Is there a separate legislation relating to minimum wages in Nicaragua?

Yes, it's the Law No. 625: "Minimum Wage Act", approved May 31, 2007.

Do one or more minimum wages exist that is/are determined by law?

Law No. 625 gives the National Minimum Wage Commission the power to determine specific minimum wages across the country for occupational sectors.

At what level is minimum wage rate determined?

The minimum wage as the wage floor refers to a single value with national coverage. In practice it has established a range of differentiated minimum wages, whose justification tends to focus on possible differences in productivity (branches or occupations). The sectors are: Agriculture, Fishing, Mining and Quarrying, Manufacturing, Industries subject to special tax regime; Micro and small cottage industry and national tourism; Electricity, Gas and Water, Trade, restaurants and hotels, transport, storage and communications; Construction , Financial Institutions and Insurance; Community, social, personal and domestic; Central Government and Municipal.

On what basis is minimum wage calculated?

For the 10 occupational sectors fixing the minimum wage per month, per day and per hour.

In case of weekly/monthly minimum age, are they based on any fixed number of hours?

The normal working day is determined by law or by agreement between the parties, whether in the individual employment contract or collective agreement. It is classified as: Day: when the time is fulfilled between 6 am and 8 pm. Maximum hours allowed by law: 8 hours a day, 48 a week. Nocturna: when the day is met between 8 pm and 6 am the following day. Maximum hours allowed by law: 7 hours daily and 42 weekly. Mixed: hours are worked day and night. Maximum hours allowed by law: 7 ½ hours a day, 45 a week. However, if you work more than three hours at night, the day becomes night.

Are governmental bodies, employer and/or trade union representatives involved in minimum wages setting?

The National Minimum Wage Commission consists of a workers' representative appointed jointly by the central and national confederations, a representative of employers jointly appointed by the Chambers of employers and a representative of the Ministry of Labour.

How are upratings (adjustments) of minimum wage/s decided upon?

The minimum wage adjustment as express provision is made automatically, following a meeting of the National Minimum Wage.

Which are the components of minimum wage in Nicaragua?

Minimum wages in Nicaragua have a fixed component. Minimum wages for each sector are agreed basic pay each worker must earn. In no case may practice decreases wages in cases that are paying higher wages stated in the table.

How frequently is the fixed component of minimum wage updated?

Law 625 states that the minimum wage is set every six months attending to the details of each job and the economic sector.

What is/are the yardstick/s on which minimum wage upratings are based?

For reviews of minimum wages are taken into account the semi annual inflation rate plus the real growth of each sector of the economy, according to the National Accounts of the Central Bank of Nicaragua up to a maximum of one hundred percent of the value of the basket.

What is National Poverty line?

Click here to know the national poverty line in context with Minimum Wage, living wages and actual wages. Select the currency (Euro or national currency) to know national poverty line.

What is the incidence of minimum wages(s) in the national labour force (wage earners only)?

In Nicaragua, according to data from 2010, the country's workforce is 2811.8 million of which 2591.7 million are employed.

How is minimum wages compliance regulated?

The Ministry of Labour is responsible Nicaragua. Employers are required to notify the labour inspector on amounts agreed minimum wage, the Inspector must verify such information through the review of the same form and report on the inspection report compliance official minimum wages for the employer inspected, all in accordance with the provisions of the minimum Wages Act itself and lower the guidelines established by Law No. 664 Law Labour Inspectorate and its regulations, when making inspections.

Which legal sanctions can be applied in compliance is lacking?

The fine imposed on employers who do not comply with the minimum wage corresponds to a minimum fine equal to twenty-five percent (25%) of the amount of your return corresponding to the time of the offense. Additionally entitles the worker, who receives less than the minimum wages fixed, to recover the amount owed to him by the courts, and this inalienable right, allowing the worker to claim this amount even after the relationship ended labour.

Are sanctions often being applied?

If inspectors find a violation, the penalties are applied.

Are employer and/or trade union representatives involved in compliance procedures?

The Minimum Wage Act states that the National Minimum Wage Commission (consists of a workers' representative appointed jointly by the central and national confederations, a representative of employers jointly appointed by the Chambers of employers and a representative Ministry of Labour) is to ensure that allocation decisions fixing minimum wages are effectively enforced and complain to the authorities of the Ministry of Labour violations.

To whom/Where can individuals complain, if they think they are earning less than minimum wage?

The Ministry of Labour of Nicaragua is responsible for receiving and managing complaints for failure to pay the minimum wage. It has a job counselling line (505) 2222-3010 or website: http://www.mitrab.gob.ni