Employer of record services in Chile

Yes. We manage AFP pension contributions (largely employee-funded, though reform to add an employer contribution has been progressing through Chile’s legislature) and health contributions to Fonasa or a private Isapre, along with progressive income tax withholding. We also manage the legal gratification (participation in profits), a mandatory bonus in many cases equal to 25% of monthly pay, capped at a statutory ceiling.

Private Isapre health coverage above the basic Fonasa alternative, life and disability insurance, and meal or transport allowances are common differentiators in Chile. Given Chile’s comparatively mature and formalized labor market within Latin America, candidates in professional roles also weigh clear performance and promotion frameworks heavily.

Statutory minimum notice is 30 days, and severance (indemnización por años de servicio) is generally due for termination on ‘needs of the business’ grounds, calculated at one month’s salary per year of service up to a cap of 11 years. Chilean labor law requires the specific cause for dismissal to be documented and communicated correctly, since incorrect classification affects both notice and severance owed.

An EOR can typically onboard within one to two weeks for AFP and health registration, compared with the several weeks needed to incorporate a Chilean entity and register with the Servicio de Impuestos Internos (tax authority) and social security bodies.

Chile’s gratification bonus rules and its capped, tenure-based severance formula require local expertise to calculate correctly. An EOR manages that compliance and carries the liability, which is typically the practical route for accessing Chile’s relatively mature and well-educated professional talent pool.