Puerto Rico: Pay and benefits

Original and updating authors: Shiara Diloné-Fernández, Elizabeth Pérez-Lleras, Littler.

Updating author: Edwin J. Seda-Fernández, Adsuar Muñiz Goyco Seda & Pérez-Ochoa, P.S.C.

See the legal services provided by the authors of International > Puerto Rico, including any discounts/offers for subscribers.

Summary

• US federal and local Puerto Rico laws govern various aspects of pay and benefits. (See General)
• For many employees, local law governs some aspects of payment of wages, including the frequency and method of payment. (See Payment of wages)
• Under local law, other than in respect of tax and statutory social security contributions, an employer may generally make deductions from an employee's wages only with the employee's written authorisation and for certain purposes. (See Deductions)
• Federal and local law require equal pay for equal work for women and men. (See Equal pay)
• Employers covered by the relevant federal law are required to pay "non-exempt" employees the federal minimum wage, unless the Puerto Rico minimum wage is greater (as it is currently), in which case employers will have to pay the Puerto Rico minimum wage. (See Minimum wages)
• Employers are not required by law to provide their employees with any private pension plan, or other benefits such as healthcare or life insurance. (See Pensions and benefits)
• Employers must withhold employees' income tax at source (Puerto Rico has its own income tax system), and employers and employees must pay both federal and local social-security-related taxes. (See Income tax and social security)
• Under local law, "non-exempt" employees are entitled to paid sick leave, while various public schemes pay benefits to employees who are absent from work owing to a non-occupational illness or injury. (See Sick pay)
• Employers are generally required by local law to pay all employees who have worked a certain number of hours during the year an annual Christmas bonus. (See Mandatory annual bonus)
• Employers are required to maintain detailed payroll records and to keep certain other information/documents regarding employees. (See Payroll and other record-keeping requirements)