Employer Of Record in Peru

We make it easy and painless to expand your business into Peru. Forget about dealing with local regulations, confusing tax laws and international payroll management. We take care of all that so you don't have to.

Accelerate your growth into Peru Compliantly and hassle-free

At Serviap Global we handle all employee onboarding, payroll, compliance, risk, mitigation and benefits, so you can focus on what matters most – your business.

How we can help you expand in Peru

As your EOR in Peru, we’d help you expand by hiring employees and running their payroll without establishing a local branch office or subsidiary. 

Your candidate is hired by a PEO in Peru provider in accordance with local labor laws and can be onboarded in days instead of the months it typically takes. Shortly after, your new employee will be working for you, just like any other member of your team. 

Expand to Peru with Serviap Global

Through our PEO and EOR services, you can hire qualified talent in your industry without the trouble of opening your own legal entity. 

In just a few days, you can easily and safely build a presence in Peru, being sure that your staff will be hired in compliance with labor and tax regulations

Table of Contents

Quick Facts

Currency:
Peruvian Sol (PEN)

Capital:
Lima

Payroll Cycle:
Monthly

Languages:
Spanish, Quechua, Aymara

Peru Country Facts

Peru has a rich history of architecture and engineering, and its heritage is a great mix of Hispanic and native traditions. It also has a diverse landscape (including mountains, deserts, beaches, and jungle). A fascinating overlap of civilizations gives Peruvian culture its very essence. Thanks to technological advancements, modernization, and development, Peru has become a lucrative country in which to do business. Not only is it a fast-growing economy in South America, but it has also created a favorable and friendly environment for foreign investments. This is reflected in the fact that Peru ranks 85th in the World Bank Ease of Doing Business Survey, giving investors the confidence to expand their business to Peru.

Facts to Consider Before Expanding Your Business

To expand to a new business environment, you need both experience as well as a nuanced understanding of the culture. At SERVIAP we are leveraging our understanding of Peru to help our clients expand their business in the region. Here are some high-level facts to understand the risks and opportunities of doing business in Peru.

The Economy

1. According to the IMF, Peru is one of the fastest-growing economies of Latin America. 2. Despite reduced growth in 2019, Peru has taken initiatives to invest in infrastructure, particularly in transportation, sanitation, health, telecommunications, and water. 3. Peru experienced a sharp growth in employment and income in the 1980s-90s, bringing a steep decline in poverty. 4. Peru is undergoing a high agriculture export boom, with an increasing demand for high-value seasonal fruits and vegetables in the northern hemisphere. 5. With leading mineral industries, diverse resources, Peru has also successfully managed its skilled labor. In fact, Peru has absorbed its migrant populations to create a profitable workforce.

The Main Sectors to Run a Successful Business

1. The Service Sector in Peru is the highest contributor to GDP, at nearly 60%. Within the sector, some of the promising industries are: • Retail and wholesale trade, accounting for 13.7% of GDP • Financial and business services at 8.5% of GDP • Peru’s telecom sector is also a promising arena for investors. Broadband penetration is still only 56%, which means the sector will see high growth in the coming years. 2. The Industrial Sector is the second largest contributor to the GDP at 32.7%, with the main industries being: • Manufacturing at 23% of the total GDP • Mining, which constitutes 57% of Peru’s exports

Characteristics of the Peruvian population

Demographics 1. Peru is the fourth-most populous country in South America and the 43rd in the world. 2. The population density in Peru is only 25 people per square kilometer, much below the world average of 50. 3. The growth rate of the population is around 1.42% annually. 4. Peru has a young population, with around 30% of people between the ages of 15 and 29. This is why the percentage of people entering the workforce increases by nearly 2% (or 300,000 people) every year. 5. The median age in Peru is 28 years. Geography 1. Peru is the third-largest country in South America and the 20th largest in the world. 2. Peru is bounded by the Pacific Ocean to the west and the Andes mountains to the east. 3. It is bordered by some of the strongest economies of Latin America – Ecuador and Colombia to the north, Brazil to the east, and Chile to the south.

Heritage & Culture of Peru

Peru is most popularly known for Macchu Picchu, an architectural-engineering marvel and a Wonder of the World. But there’s more to Peru’s heritage: 1. Peru became the World’s Leading Culinary Destination 2019. With mixed Spanish-Andean identity, Peru’s cuisine incorporates influences from various migrations and local produce to make innovative dishes. Peru’s national dish — Ceviche (citrus cured fish) — is simple, delectable, and popular worldwide. 2. The monuments of Peru make it a hotspot for tourism. From ruins like Caral to an architectural beauty like Qorikancha to the unexplained designs of Nazca Lines in the desert, Peru has something for every explorer. 3. Part of Peru is covered with the Amazonian Basin, which is a biodiversity and conservation hotspot. The rainforest is an important part of the ecology of Peru, providing a home to wildlife and the Amazon tribes.

Consumer preferences

1. Peruvian consumers are more interested in foreign-branded products than ever before. 2. The higher-income buyers in Peru also recognize the need to buy locally made products to sustain the local businesses. 3. Peruvian consumers are aware of the environment and its sustainability. 4. When buying, Peruvian consumers are rational and expect high-quality products. 5. A great surge in e-commerce means Peruvian consumers are actively seeking discounts and promotions.

Economic opportunities

Workforce and laws The rights of Peru’s workers are safeguarded by Peru’s labor laws. People who are looking to create business opportunities in Peru need to be aware of the regulations applicable to Peruvians, but also the ones applicable to foreign employees. These are better handled by experts. Some of the things to look out for: 1. The minimum wage in Peru is PEN930 or 242.4 € per month 2. A maximum work-week of 6 days and 48 hours is allowed. 3. For overtime, the employer must pay a minimum surcharge of 25% over the regular rate for the first two hours, and a minimum surcharge of 35% thereafter. 4. Employers can hire regular staff on a three-month trial, which can then be extended for another three months. This doesn’t entitle the employer to arbitrary dismissal of course. Human Talent 1. Peru’s labor laws have given a push to women’s employment in all sectors. 2. Peru’s strong tourism sector means that a large percentage of the population speaks English. 3. Peru is keenly interested in promoting start-ups and is trying to create a Silicon Valley in the capital city, Lima. 4. 33% of Peruvian software developers are looking for work. Peru is one of those rare economies where the supply of tech talent outstrips demand, making it the perfect outsourcing destination. 5. The quality of tech talent in Peru is quite exceptional as well. Peru ranks 26th on the TopCoder rankings. Technological ecosystem The major areas where Peru is witnessing technological advancements are: 7 1. The e-commerce industry is a relatively untapped market for Peru and the retail brands are speedily investing in it. Only 21% of the Peruvian population currently shops online so there’s a lot of scope for growth. Mercado Libre and Sagafallabella are popular home-grown e-commerce companies. 2. Peru is interested in technological developments that will align with its mining industries and natural resources. Both national companies like ZINSA and MNCs like Rio Tinto dominate this space. 3. Recognizing that Peru is lagging in innovative advancement, the government has also focused on bringing investments through StartupPeru and InnovatePeru. Facilities for foreign investment Peru has a relatively open and favorable environment for foreign investors, as compared to its neighbors. Key reasons: 1. Freedom of Establishment- one of the basic principles in the Peruvian economy is the equal treatment of national and foreign capital, accorded by the law on the promotion of foreign investments and its decree: Law number 662 of 1991. 2. Foreign investors can have a major stake in the capital of a local company. 3. With a few exceptions, foreign capital can be invested in all economic sectors without prior authorization.

Peru Visa Requirements

If you’re looking to expand your business to Peru, you may require work visas for your expat employees. Visa waivers are provided for citizens of a select few countries – Brazil, Colombia, and the Schengen Area countries. Since Peru is a member of the Asia-Pacific Economic Cooperation agreement, some nationals with APEC Business Travel Cards can avail of visa waivers.

General Highlights

Year 2022
Country Republic of Peru (PE,PER)
Capital Lima
Num. States / Province 24 states
Principal Cities Lima, Arequipa, Trujillo
Language Spanish (84%), Quechua (13%) Aymara (1%)
Local Currency Peruvian Sol; PEN; S/
Major Religion Catholic
Date Format DD-MM-YYYY
Thousands Separator Format 999.999.999,99
Country Dial Code +51
Time Zone Peru Time (PET) GMT -5
Population 32.13 Million
  Border Countries It borders the Pacific Ocean in the west and borders five countries: Ecuador and Colombia in the north, Brazil in the east and Bolivia and Chile in the southeast.
Continental surface 1,285,216 km2
Tax Year January 1st- December 31st
VAT % 18%
Minimum Wage S/ 930 or 281 USD (as of Feb 2021)
Tax Payer Identification Num- ber Name in the country RUC – Unique Registry of Taxpayers (Registro Único de Contribuyentes)
Current President Pedro Castillo
What you need to know about employing personal in Peru

Laws That Regulate Labor Relationships

Laws Brief Description
  General Labor Law (LGT) This Law regulates personal, subordinate and remunerated services, arising from a verbal or written contract.

Key Tax and Labor Authorities

Authorities Brief Description
Ministry of Labor and Employ- ment Promotion It is responsible for promoting decent and productive employment, as well as to be in compliance with the labor rights.
National       Superintendency        of Labor Inspection It is the public entity through which has the commitment to guarantee respect for the rights of the workers, as well as to generate adequate conditions for the development of the economic activities of companies, promoting their formality and productivity.
National Superintendence of Customs and Tax Administration (SUNAT) The primary purpose of SUNAT is to administer the taxes of the national government and the tax and non-tax concepts that are entrusted to it by Law or in accordance with the inter-institutional agreements that are signed.

Labor Contracts

By the employment contract, the worker undertakes to personally provide services to an employer, under his subordination, in exchange for renumeration. (Art. 1) All kinds of material services may be the object of the employment contract or intellectuals, provided they are not contrary to public order and good custom. For most employees, there may be a trial period is three months, during which time the employer may dismiss the employee without paying a severance package. The trial period max be extended to six months for executive-level employees. Types of Contracts The labor relations may be for a fixed or indefinite period, a specific project, and/or may be subject to a part-time apprenticeship contract. In the absence of express stipulations to the contrary, labor contracts are assumed to be for an indeterminate period.
Indefinite contract The employment contract is presumed to be for an indeterminate time unless otherwise stated.
Indefinite contract Employment contracts of indefinite duration are considered: –  The seasonal contract, concluded in order to meet the needs of the company’s business, which are met only at certain times of the year and which are subject to repetition in cyclical periods depending on the nature of the productive activity. The following must be included in this contract: a)  the duration of the season b)  the nature of the company’s activity c)  the nature of the worker’s duties. In both cases, the period in which the worker does not provide effective services is considered a de facto suspension of the employment contract. The service time and the rights derived from it will be determined based on the period actually worked. (Art.17 ) Work contracts concluded at a specified time may be retroactively considered indefinite if: 1)  The worker continues working after the expiration date of the stipulated period, or the extensions agreed in accordance with the Law; 2)   The worker continues to provide effective services, after the completion of the specific work or service subject to the contract 3)   The holder of the replaced   position does not return to work or is given a different position and the worker continues to work 4)   When the termination of the contract has not been stipulated in writing
Fixed-term contract Fixed-term contracts are permitted under certain circumstances, described in Art. 16 of the LGT. Fixed-term employment contracts can be concluded as required by the temporary or accidental nature of the service to be provided or the work to be performed. They must be in written in triplicate, the objective causes must be expressly stated determinants of the contract, its duration, as well as the others conditions of the employment relationship. A copy of the contracts will be presented to the Administrative Authority of Work within thirty (30) calendar days after your celebration, for the purposes of registration and verification of data consigned therein. The other copies are given one to the worker and another to the employer.
Intermittent and seasonal contracts Employment contracts of intermittent duration are considered: 1)  The intermittent contract, to cover the needs of the activity of the company that by their nature are ongoing but periodic, e.g. manufacturing equipment that requires periodic maintenance several times a year 2)  The seasonal contract, signed in order to attend needs specific to
Intermittent and seasonal contracts the company’s business, which are met only in certain times of the year and which are subject to repetition in cyclical periods depending on the nature of the productive activity. This contract must include the following: a)  the duration of the season b)  the nature of the company’s activity c)  the nature of the worker’s duties In either case, the completion of a given stage of a project is considered a suspension of the work contract. The time of service, for purposes of seniority and benefits, will be determined based on the period actually worked
Part-time Contract The worker is obliged to provide services in a work day of less than four hours a day or twenty-four hours a week (Art.30)
Home work contract The worker is obliged to execute his benefit at his home or in the place he freely designates, without direct and immediate supervision of one or more employers. This has the power to establish the regulations of the methodology and technique of the work to be carried out. (Art.33)
Remote work contract Regulates the subordinate performance of tasks without the physical presence of the worker at one of the company’s offices or work sites. The employee stays connected through a computer, telecommunications, or similar means, through which the control and supervision of the tasks are exercised. (Art.40)
Foreign employment contract Employers may only hire foreign personnel in a proportion that cannot exceed twenty percent (20%) of the total number of workers that provide services to them. The employment contract with foreigners must be in writing and by a predetermined duration. It cannot exceed three years, extendable successively. The extension cannot be agreed for longer periods. The contract must stipulate the worker’s obligation to train national personnel in the same occupation. The competent authority, when granting the corresponding visa, takes into account the term of the contract.

Basic Requirements

The information that the contract must contain is established in the Article 10 of Work Code:
•          Place and date of the contract
•          Nationality, date of birth, and worker income
•          The nature of the services and the place or city in which they are to be provided
•          • Term of the contract
•          Other agreements agreed by the parties.

Payroll

Payroll is one of the most important processes of a company. From this operation, the final amount that a worker will receive and the amount that the company will invest in a given period is obtained. Legally-Mandated Benefits in Peru The main benefits that the employer is obliged to provide to its workers are indicated in the Work Code, without prejudice to all those granted and agreed according to the employment contract. The labor benefits are always aimed at improving the living conditions of workers, reducing their expenses, and granting them incentives that foster their cultural and social development.
Salary The “salary” is the entire amount the worker receives for his services, in money or in kind, whatever the form or denomination given to him, provided that it is freely available to him. This definition applies for all legal purposes, and as the basis for the calculation and payment of the benefits provided for in this Law, as well as for taxes, contributions and contributions to social security and the like. The only cash renumeration with separate rules is the Tax on Rent, which has its own standards. (Art.191) •          Remuneration can be established per unit of time, per unit of work or a mix of the two. The remuneration per unit of time can be established as monthly, biweekly, weekly, daily, or hourly. […] (Art.193) •          Remuneration must be paid in legal tender, while a portion not exceeding twenty percent (20%) may be paid, by agreement of the parties, in kind or in any way that does not imply the delivery of money as long as they are useful goods for the worker or his family. Its fair price is determined in a reasonable way by the parties or, in the absence of an agreement, by its manufactured or fair market value. (Art.198)
Gratifications (National Holidays and Christmas Bonus) The worker is entitled to two bonuses per year, which are paid in July and December, respectively. These bonuses are each equal one month’s salary. […] (Art.206) The bonus is paid within the first two weeks of July and December each year. In the case of not having been fully employed for the entire accrual period, the bonus is paid in an amount proportional to the months and days worked. (Art.)
Vacations The worker is entitled to thirty (30) calendar days of paid vacation for each full year of services in which he meets the vacation record. (Art.285)

Employers Contribution or Labor Cost

The employer contributions are the sums of money that the employer will be obliged to contribute to the state for having employees
Social Security Social Health Insurance EsSalud Social Health Insurance, also known as EsSalud, is the institution that is responsible for the social security of workers. Through this entity, an employee can receive medications, consultations, and treatments in case of illness or accident. To do this,  once hired,  the employer  must register  and pay  a contribution equivalent to 9% of the employee’s salary. In addition, the Law says that the contribution to EsSalud may in no case be less than 9% of the minimum vital remuneration in force. Currently, it corresponds to S/ 930 or $281 USD (as of Feb, 2021). Therefore, even if you earn less, the minimum contribution will be 9% of that amount. That is, S / 83.70 The contribution to social security in Peru is an obligation on the part of the employer. No amount is deducted from the employee’s salary.
Social Security This is in charge of the pension funds for retirement. Within the pension system, there are two options for workers: the SNP, or national pension system, and the SPP, or private pension system. SNP Regulated by the Office of Pension Normalization (ONP). If you are affiliated with the national pension system, the corresponding contribution is 13% of your salary. This amount is withheld from your salary and the employer only acts as an intermediary, withholding and paying the corresponding contribution to the ONP.
Social Security Social Security SPP The private pension system is operated by Pension Fund Administrators or AFPs. The contribution made is 10% for the pension fund, with an additional percentage as an insurance premium plus a commission that varies depending on the AFP to which you are affiliated. Below is a detail of the existing AFPs and fees: To calculate the discount that you receive, an employee must add the corresponding percentages of their AFP and multiply their salary by the total percentage.
Service Time Compensation (CTS) (CTS) is a social benefit that is granted to the worker in order to constitute a kind of forced savings that allows them to face future contingencies that may occur after the termination of the employment relationship and / or meet their or their family’s needs while they rejoin the job market.
Social Security In this way, the worker who leaves their job for any reason (dismissal, resignation, end of contract, etc.), will receive money accumulated in their CTS fund. Workers subject to the labor regime of private activity who have worked at least one month (30 calendar days) in the service of the same employer and who comply with a minimum working day of four (4)  hours a day or twenty (20) hours a week are entitled to receive this benefit. To this end, this requirement shall be considered fulfilled when: •          The worker’s weekly working day, divided between six (06) or five (05) days, as appropriate, results in an average of not less than four (4) hours per day. •          If the work week is less than five (5) days, the requirement is considered fulfilled when the worker works at least twenty (20) hours a week.
Social Security Social Security Employers are required to make the CTS deposit within the first fifteen (15)   calendar days of the months of May and November of each year. For this purpose, two (02) computable semesters are considered: •          From November 1 to April 30 for the purposes of the May deposit. •          From May 1 to October 31 for the purposes of the November deposit.

Workday, Holidays, Disabilities and Sick Days

The workday is the time during which the worker must effectively lend their services in accordance with the contract and will also be considered the time in which the worker is at the employer´s disposition. Working hours shall not exceed 48 hours weekly.
The work shifts that include working hours at night, rotate among different staff members, whenever possible. Renumeration for nighttime hours will include a bonus of 35% over normal hourly wages. The night shift covers the time worked between 10:00 p.m. and the 6:00 am.
The ordinary day may be exceeded, but to the extent necessary to avoid damages in the normal operation of the establishment or work, of a force majeure, or when accidents must be prevented or arrangements or repairs cannot be carried out in the machinery or facilities. Hours worked in excess of the 48 weekly hours will be paid as overtime.
The time worked that exceeds the daily or weekly work day is considered overtime, and is compensated with a minimum surcharge of twenty-five percent (25%) on the hourly value for the first two (2) hours and thirty-five percent (35%) for additional hours that exceed the daily workday.
The worker is entitled to at least twenty-four (24) hours consecutive paid rest in each week, which will be granted preferably on Sunday.
Workers have the right to paid rest for the holidays indicated in this Law, as well as for those determined by specific legal norm.
 
Type of Work Day Working hours per Day Over Time Sundays
Day shift 6:00 AM – 08:00 PM 8 hours per day (48 hours per Week First 2 hours: additional 25%, 3 hours and on: additional 35% Entitled to an additional bonus of 25% on the salary of the ordinary days of work (even if within the 48-hour weekly limit)
Night Shift 10:00 PM – 06:00 AM 7 hours per day
Mixed Shift 07:00 AM – 01:00 PM 7 hour 30 minutes per day

Public Holidays

Date Holiday Name
January 1st New Years
** Holy Thursday and Friday
May 1st Labor Day
June 29th Saint Peter and Saint Paul
July 28th and 29th National Holidays
August 30th Saint Rosa De Lima
October 8th Battle of Angamos
November 1st All Saint´s Day
December 8th Day of the Immaculate Conception
December 25th Christmas

Migration Process

Temporary Worker
All documents that are in a foreign language must be translated into Spanish by a Certified Translator or a Sworn Public Translator (Article 12, numeral 12.2 of Supreme Decree No. 007-2017-IN, which approves the Regulations of DL 1350).
Requirements:
•   Form F-007
•   Payment receipt from the Banco de la Nación for processing rights.
•   Legible copy of the valid passport or travel document. The visa beneficiary must be in-status, with no outstanding immigration violations.
•   Notarized power of attorney.
•   A photostatic copy notarized or authenticated by the MIGRATIONS notary of the contract for the provision of services, technical cooperation or other similar signed between the foreign company and the natural or legal person receiving the service, duly notarized by the Peruvian Consulate and the Ministry of Relations Foreign or apostilled, if it was signed abroad.
•   Designation document issued by the company abroad, individually by each worker legalized by the Peruvian Consulate and the Ministry of Foreign Affairs or apostilled, indicating names and surnames,
18  passport number, and specialty of the beneficiary, as well as the duration time of service in the country.  19
•   The document must expressly state that both the remuneration and per diem or any type of payment will be paid by the foreign company and that the beneficiary will not have any dependency relationship with a local company.
•   Letter from the Peruvian company that receives the service, indicating the type of activity and place where the service will be received, that the work that the beneficiary will perform is highly specialized and that they could not easily be performed by a Peruvian citizen or citizens.
Note:
In case of a contract signed in the country, the user must meet the qualifying immigration status or have special permission to sign contracts. If the contract was signed abroad, it must be legalized at the Peruvian Consulate and the Ministry of Foreign Affairs or apostilled. The contract must be presented to the foreign employee within thirty (30) days of being approved by the Labor Authority.
In cases where the contract includes a trial period, a temporary visa will be granted.
The temporary visa is one hundred eighty-three (183) days, cumulative over a period of three hundred sixty-five (365) days. Extension applies for the same period.
In the cases in which there are bilateral or multilateral agreements signed by Peru with other States or international organizations, the payment of fees, processing fees or other facilities will be subject to their provisions.
The qualification of Temporary or Resident will depend on the legal provisions in force, the supporting documentation, and the discretion of the immigration authority.
In the event that the procedure is carried out by a third person, they must present a power of attorney of the applicant, notarized. If the power is granted outside the country, it must be legalized by the Peruvian Consulate and the Ministry of Foreign Affairs or apostilled.

Employee Termination

The employment contract will end in the following cases:
  1. The death of the worker
  2. The death of the employer if he is a natural person, with the exception provided for in Article 9 of this Law;
  3. Esignation of the worker
  4. The completion of the work or service and the expiration of the term in contracts entered into for a specified duration
  5. The termination agreement between worker and employer
  6. Permanent absolute disability
  7. Retirement
  8. Dismissal in the cases and form allowed by law. (Art.148)
“Resignation” is the voluntary and unilateral act by which the worker, without obligation to express cause, terminates the employment relationship. The worker must communicate his resignation in writing, thirty (30) days in advance before the cessation of their work. The employer can exempt him from this period on his own initiative or at the request of the worker. […] (Art.150) Retirement is mandatory and immediate when the worker reaches seventy (70) years of age, unless the parties agree otherwise. […] (Art 153) A worker can only be dismissed when there is just cause established by law. The just cause must be related to the capacity or conduct of the worker or to the operating needs of the company. (Art.154) The following are reasons related to the operating needs of the company, which justify the dismissal:
  1. Economic, technical or structural
  2. An event of force majeure
  3. Dissolution and liquidation of the company due to insolvency and bankruptcy
  4. Voluntary dissolution and liquidation or by court order. (Art. 176)
Labor termination settlement The compensation for unjustified dismissal, […], is equivalent to: a) Forty-five (45) days of ordinary remuneration for each full year of services, with a minimum of ninety (90). days, up to a maximum of eight (8) years b) Thirty (30) days of ordinary remuneration for each additional year up to a maximum of eight (8) years. c) To fifteen (15) days for each additional year up to a maximum of eight (8) years Fractions are paid for twelfths and thirtieths, provided that the compensation exceeds the minimum amount. […]. (Art.176 ) The workers dismissed (laid off), collectively, for economic, technical or structural reasons referred to in article 176 ° have the right to receive the following compensation: a) To twenty-two (22) days of ordinary remuneration for each complete year of services, up to a maximum of eight (8) years; b) To ten (10) days of remuneration for each additional year up to a maximum of four (4) years; and c) To seven (07) days for each additional year up to a maximum of four (4) years. The compensation for time of services (CTS) has as a priority the forecasting of contingencies that cause the termination of the worker, and is equivalent to eight and thirty-three hundredths (8.33%) of what is received by the worker in each month, including the total of the fixed, variable and occasional remunerations paid. The employer must deposit this amount, within the first five (5) days of the following month, in the bank or financial entity designated by the worker and it can be made, at the latter’s choice, in national or foreign currency. (Art.219 ).

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