Currency
Peruvian Sol (PEN)
EOR IN Peru
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EXPAND YOUR BUSINESS IN South America
A guide to employing and growing your team in Peru
Fast and compliant market entry. Hire top local talent without the need for a legal entity
Peru is a South American nation having over 5000 years of civilization with a rich cultural heritage. Peru’s labor market is heavily regulated with a strong emphasis on worker protections and mandatory social benefits. The system is characterized by unique bonuses and high employer-side costs. Employment is primarily governed by the Productivity and Labor Competitiveness Law. As of April 2026, the national minimum wage (Remuneración Mínima Vital – RMV) in Peru is PEN 1,130.00 per month. A standout feature of Peruvian payroll is the “Gratificaciones” system, where employees receive two mandatory bonuses annuallyone in July (Independence Day) and one in December (Christmas)each equivalent to one full month’s salary.
Employer Contributions
Health Insurance (EsSalud): 9%
Life Insurance (Vida Ley): Required from day one (rate varies by provider)
CTS (Compensation for Length of Service): ~8.33%
Profit Sharing: 5% – 10% of pre-tax profits (mandatory for companies with >20 employees)
Total Employer Contribution: ~18% – 20%
Employee Payroll Taxes
Pension Fund (AFP or ONP): ~13%
Total Employee Contribution: ~13%
Employee Income Tax Rates
Income tax in Peru is calculated using the UIT (Tax Unit), which is adjusted annually. 1UIT= 4400 Peruvian Sol
Up to 5 UIT: 8%
5 UIT – 20 UIT: 14%
20 UIT – 35 UIT: 17%
35 UIT – 45 UIT: 20%
Above 45 UIT: 30%
Statutory Leave
Employees are entitled to 30 calendar days of paid annual leave after one year of service. Peru is also known for its high number of public holidays, observing 16 national holidays in 2026 (including a two-day celebration for Independence Day in July). Unused vacation days can be “sold” back to the employer (up to 15 days) with mutual agreement, but at least 15 days must be taken as rest.
Pregnancy and Maternity Leave
Female employees are entitled to 98 days of paid maternity leave (49 days prenatal and 49 days postnatal). This leave is funded by the Social Health Insurance (EsSalud). Job protection is guaranteed during the pregnancy and for a period following the birth, protecting the employee from dismissal without “just cause.”
Paternity Leave
Fathers are entitled to 10 consecutive days of paid leave for the birth of a child, which is fully paid by the employer. In cases of multiple births or complications, this leave can be extended to 20 or 30 days.
Work-Related Injury Leave
Sick Leave: The employer pays the first 20 days of illness at 100% salary. From day 21, EsSalud provides a subsidy for up to 11 months and 10 days.
Family Allowance (Asignación Familiar): Employers must pay an additional 10% of the minimum wage to employees with children under 18 (or up to 24 if studying).
Bereavement Leave: 5 days for the death of a spouse, parent, or child.
Termination Process
Peru follows a “protection against arbitrary dismissal” principle. Termination requires a “Just Cause” related to the worker’s conduct or capacity. Employers must issue a “pre-dismissal” letter giving the employee 6 days to respond. If a dismissal is found to be “arbitrary” (without cause), the employer must pay an indemnity of 1.5 months’ salary per year of service, capped at 12 months’ salary.
Notice Period
By the Employee: 30 days’ notice is required for resignation. The employer can waive this period at their discretion.
By the Employer: For dismissal due to capacity or conduct, a minimum of 6 days (for defense) or 30 days (to demonstrate improvement in capacity) is required.
Probation Period
The standard probation period is 3 months, during which an employee is not entitled to protection against arbitrary dismissal. For “trusted” employees or those in management, this period can be extended to 6 months or even 1 year, provided it is agreed upon in writing.