C. R. & F. Rojas Abogados

1

GENERAL PRINCIPLES

Forums For Adjudicating Employment Disputes

Specialised Labour and Social Courts adjudicate all employment disputes in Bolivia. There are nine (9) Judges of Labour and Social Security in La Paz and four (4) in El Alto, three (3) rooms in the Tribunal Departmental de Justicia and two (2) rooms in the Tribunal Supremo de Justicia for cases of annulment.


The Main Sources Of Employment Law

The main sources of employment law in Bolivia are codified laws, decrees, ministerial decisions, Collective Agreements, and individual contracts.


National Law And Employees Working For Foreign Companies

Bolivian law applies to people who work for foreign companies within Bolivian territory. Foreign companies cannot hire employees in Bolivia, they must be incorporated in Bolivia.


National Law And Employees Of National Companies Working In Another Jurisdiction

There are no Bolivian long-arm statutes. Accordingly Bolivian law does not apply to employees of Bolivian companies working in another jurisdiction.


Data privacy

Individuals whose personal data is sought, must be previously informed that their data will be subject to handling, for purposes of collection and registration; potential recipients; the address and identity of the person responsible for its handling or its representative; and the likelihood of exercising rights to access, amend, update, cancel, challenge and revoke, among others.

The personal data subject to handling may not be used for purposes other than those expressed at the time of collection and registration. The personal data that is subject to handling may only be used, communicated, or transferred to a third party, without the prior consent of the owner or a written order from a judicial authority.

The party responsible for handling personal data must undertake the necessary technical and organisational measures to secure the personal data and prevent its alteration, loss, unauthorised use, which must be adjusted in accordance with the state of technology, the data’s nature, and exposed risks, whether through human action or from a physical medium or natural environment.

2

HIRING THE EMPLOYEE

Legal Requirements As To The Form Of Agreement

Employment agreements must be entered by the parties and the endorsed by the Ministry of Labour.


Mandatory Requirements
  • Trial Period

    • A three (3) month trial period only applies to new employees with indefinite employment contracts. Employees dismissed during the three (3) month trial period are not entitled to severance payment or other employment benefits.

  • Hours Of Work

    • The following hours of work are set by statute: Eight (8) hours per day, seven (7) hours per night shift (night work is between 20h00 and 06h00), 48 hours per week for men, 40 hours per week for women. Working hours do not apply to those employees that cannot submit themselves to working hours set by statute because of the nature of their work, in this case employees may not work for more than 12 hours. Overtime, holidays, and Sunday work is paid at a 100% surcharge.

  • Special Rules For Part-time Work

    • There are no specific rules concerning part-time work, however, in this case, it would be understood that the working day is four (4) hours per day and the minimum pay amounts to half the national minimum wage.

  • Earnings

    • Employees may not earn less that the minimum income level (currently $339,36 Bs. 2.362 per month) set by the Executive branch of Government.

  • Holidays/Rest Periods

    • Employees are entitled to annual vacation that varies according to the length of service: One (1) to five (5) years’ service entitles an employee to 15-days; five (5) – 10 years’ service entitles an employee 20-days; 10+ years’ service entitles an employee to 30-days annual vacation. In addition, employees are entitled to various public holidays and Sunday as a day off.

  • Minimum/Maximum Age

    • Minors under 14-years old are prohibited from working. The maximum working age is 65 years unless the employer agrees to hire the employee for three (3) more years. The normal retirement age under the social security system is 58 for men and 55 for women. Retirement age for pension plan purposes depends on the amount of capital accumulated by the employee.

  • Illness/Disability

    • The Caja Nacional de Salud must provide the covered employee with all the necessary medical assistance for any illness work related or not:

    • Disability benefits are provided as part of a long-term insurance by the pension funds that cover disability, old age, and death. The benefits are monthly annuities that depend on the years of contribution to such a fund by the employee. The employees must contribute to the mentioned fund up to 12.21% of their monthly remuneration, and a contribution called ‘Solidarity’ (for further details, see under Social Security Contributions in Section 3).
    • Disability benefits are paid based on the level of an employee’s disability as a result of the sickness.

     

  • Location Of Work/Mobility

    • If a worker is hired for services at a location other than the place of residence, the employer must bear the reasonable travel expenses. If there is a preference to change residence, the employer must fulfil its obligation to the same extent.

  • Pension Plans

    • Monthly social security contributions allow employees to retire. Pension Payments are made monthly unless the employee opts to be paid in one lump sum.

  • Parental Rights (Pregnancy/ Maternity/ Paternity/ Adoption)

    • Maternity paid leave amounts to 45-days before birth and 45-days after birth. Maternity leave may be extended due to medical reasons.

  • Compulsory Terms

    • The following compulsory provisions must be included in every employment contract: Employer’s contact details (name, domicile, legal representative, identification number, and legal representative’s identification number); age, nationality, and domicile of employee; nature of service or task, and place where service or task will be performed; salary; duration; place and date of employment contract; name of children, age of children, and wife. If the employee is single, the names of the parents or appropriate legal heirs should be included.

  • Non-Compulsory Terms

    • Non-Compulsory Terms in addition to compulsory provisions may be included in an employment contract.


Types Of Agreement

Employment contracts under Bolivian Labour Law may be as follows: Individual, collective, verbal, in writing, fixed term, and undefined term. However, verbal contracts must be formalised through the signing of written contracts within 30-days from the date the employee was hired.


Secrecy/Confidentiality

When an employee reveals industrial secrets, the right to receive social benefits is waived and the employee can be dismissed.


Ownership of Inventions/Other Intellectual Property (IP) Rights

When an employee reveals industrial secrets, the right to receive social benefits is waived and the employee can be dismissed


Pre-Employment Considerations

There are no current rules concerning pre-employment considerations, such considerations are subject to the employer’s own policy.


Hiring Non-Nationals

A maximum of 15% of the total workforce of a company registered and domiciled in Bolivia can be comprised of non-nationals. Also, a company registered and domiciled in Bolivia may hire only qualified non-nationals. Non-nationals working in Bolivia require a visa.


Hiring Specified Categories Of Individuals

Women and minors under the age of 18 can only work during the day and cannot be employed on dangerous tasks.


Outsourcing And/Or Sub-Contracting/Temporary Agency Work

Employers may not outsource or subcontract work that is inherent to the company.

3

MAINTAINING THE EMPLOYEE RELATIONSHIP

Changes To The Contract

Employers may not make changes to an existing employment contract unless they have the employee’s consent, and such changes are not contrary to Bolivian Labour Law.


Change In Ownership Of The Business

Changes in the ownership of the business do not affect the validity of the existing work contracts. Employees are not allowed to refuse a change in ownership of the business.


Social Security Contributions

The following Social Security Contributions are mandatory by statute. An employer’s contribution amounts to a total of 13.71% which consists of housing (2%), professional risk (1.71%), short-term insurance (10%), and a contribution called Solidarity of 0.5%. A solidarity fund is aimed at helping to improve the lower incomes of other policyholders, which corresponds to 3%.

An employee’s contribution amounts to a total of 12.71% which consists of seniority contribution (10%), common risk (1.71%) and Pension Fund commission of 0.5%, and a contribution called Solidarity. An additional solidarity contribution exists when the total amount earned exceeds 13,000 Bs according to the following detail: If the total earned is greater than Bs. 13,000, the contribution is 1%; for earnings above Bs. 25,000, the contribution is 5%, and if it is greater than Bs. 35,000, the contribution is 10%.


Accidents At Work

Where there is an accident at work, the employee must file a complaint within 24 hours of the accident before the employee’s respective Health Fund.


Discipline And Grievance

In cases where certain grievances are raised, the labour inspector has to be informed. The labour inspector also has the right to enter the workplace without warning. Where a grievance concerning harassment is made, the employer has to aid the employee and support them against other employees if necessary. Rules concerning discipline are more typical in employment relationships governed by public law (for example, for magistrates who have tenure).


Harassment/Discrimination/Equal pay

There are no express provisions in Bolivian Labour law which relates to equal pay. All companies must have Internal Regulations that treat the following types of racist and/or discriminatory behaviour as misconduct:

  • Racially motivated verbal attacks and/or discriminatory action intended to offend a person’s dignity as a human being.
  • Denial of access to employment or benefits because of racism and/or discriminatory conduct.
  • Physical, psychological, and sexual ill-treatment to any employee regardless of hierarchy, for racist and or discriminatory reasons, that cause psychological and/or physical harm, provided it does not constitute itself as a felony.
  • Activities which denigrate the moral and good customs of any company employee.

Compulsory Training Obligations

There are no compulsory training obligations under Bolivian Labour Law.


Offsetting Earnings

Offsetting earnings against employees’ debts is not allowed under Bolivian Labour Law.


Payments For Maternity And Disability Leave

Disability benefits are provided as part of a long-term insurance by the pension funds that cover disability, old age, and death. Disability benefits are paid based on the level of employee’s disability as a result of the sickness. Accordingly, disability benefits are paid as follows: Absolute disability, two (2) years of salary; permanent disability, one (1) year of salary; partial disability, 18-months of salary; temporary disability, salary is paid for duration of disability for a maximum of 6-months.

During maternity leave, the employee is entitled to receive necessary medical treatment. Maternity leave consists of 45-days leave prior to the birth of the child and 45-days after the child’s birth. During maternity leave, the employee’s salary must be paid.

An employee on maternity leave has a right to receive milk products prior to the birth of a child. The value of the milk products must be at least equal to one (1) month’s salary at the minimum wage and must be given to the employee at the start of the fifth month of pregnancy and up to the day of birth.

A post-natal subsidy and a milk subsidy are also provided to the employee on maternity leave after the birth of a child. The post-natal subsidy is given once and must be at least equal to one (1) month’s salary at the minimum wage. The milk subsidy must be provided a monthly basis until the child is one (1) year old.

It is important to note that both the father and the mother cannot be dismissed from their place of work until their child has reached the age of one (1).


Compulsory Insurance

The employer must ensure that the mandatory contributions to the security services to provide for disability, sickness indemnifications and pensions.


Absence For Military Or Public Service Duties

Bolivian Labour Law does not regulate absence for military or public service duties.


Works Councils or Trade Unions

Bolivian labour law recognises the right of association. Trade Unions are allowed in companies with more than 20 employees.


Employees’ Right To Strike

Employees have the right to strike. Before the declaration of a strike, all conflicts between the employer and the employees must be submitted to a process of conciliation and arbitration.


Employees On Strike

An employer may not fire employees who are on strike.


Employers’ Responsibility For Actions Of Their Employees

According to Article 992 of the Bolivian Civil Code, employers are responsible for damages caused by employees in the course of their employment.

4

FIRING THE EMPLOYEE

Procedures For Terminating the Agreement

Termination of an employment contract is the result of a dismissal or a voluntary withdrawal. In either of the mentioned cases, the employee is generally entitled to a severance payment and other benefits.

According to Bolivian Labour Law, an employee can only be dismissed if the Employee is found to be guilty of one (1) of the following:

  • Intentional material damage caused to work instruments;
  • disclosure of industrial secrets;
  • negligent acts that may affect industrial security and hygiene;
  • failure to comply with work agreement; and
  • theft or robbery.

If dismissal is for a reason not contemplated by the Bolivian Labour Law, the employee may request the labour authorities to be reinstated in the workplace or payment of corresponding social benefits may be requested. Upon dismissal or resignation, the employer and employee must file a form (finiquito) before the Bolivian labour authorities.


Instant Dismissal

According to Bolivian Labour Law, employees can only be instantly dismissed if they are found guilty of one (1) of the following:

  • intentional material damage caused to work instruments;
  • disclosure of industrial secrets;
  • negligent acts that may affect industrial security and hygiene;
  • failure to comply with work agreement; and
  • theft or robbery.

Employee's Resignation

There are no statutory provisions in Bolivian Labour Law that impedes an employee from resigning.


Termination On Notice

An employee can only be dismissed for the following reasons (note that in practice termination on notice is no longer used, pursuant to a Constitutional Ruling which declares it unconstitutional):

  • Intentional material damage caused to work instruments; disclosure of industrial secrets; negligent acts that may affect industrial security and hygiene; failure to comply with work agreement; and theft or robbery.
  • Notice of termination only applies in cases liquidation and dissolution of a company.

Termination By Reason Of The Employee's Age

A labour relationship may be terminated if the employee is 65 years of age or older.


Automatic Termination In Cases Of Force Majeure

Employment contracts may not be terminated automatically in cases of force majeure.


Collective Dismissals

Collective dismissals only proceed as a result of a massive abandonment of work. Work cannot be untimely interrupted in any company, nor can the employees abandon work for more than three (3) days, in case of massive abandonment of work, labour termination proceeds.


Termination By Parties’ Agreement

Termination only proceeds for reasons established by statute or if employee resigns. No approval from a court or other regulatory body is required before the termination is effective.


Directors Or Other Senior Officers

When a Director or other Senior Officer is not an employee of the company and is dismissed, the rules provided by the Bolivian Commerce Code will apply.


Special Rules For Categories Of Employee

There are no special rules for other employee categories.


Specific Rules For Companies in Financial Difficulties

Employee salaries may not be the subject of an attachment. Employees’ salaries have priority payment over other debts owed by the Employer to creditors.


Restricting Future Activities

There are no rules with regard to clauses in an employment contract that restrict future activities. This is up to the parties to decide.


Whistleblower Laws

There are no current rules in effect.


Special Rules For Garden Leave

There are no current rules in effect.


Severance Payments

If the duration of a labour agreement has been left open, upon an unjustified dismissal accepted by the employee, the employee may be entitled to an indemnity (three (3) months’ severance payment) and an indemnity for length of service (provided the employee has worked for the employer for more than three (3) months), corresponding to one (1) month’s salary.


Special Tax Provisions And Severance Payments

There are no special tax provisions that apply to severance payments.


Allowances Payable To Employees After Termination

Employees are not required to contribute towards any allowances payable to them after termination.


Time Limits For Claims Following Termination

There are none. No statute of limitations applies.

5

GENERAL

Specific Matters Which Are Important Or Unique To This Jurisdiction

Accrued wages or salary, labour rights, social benefits and social security contributions which have not been paid have privilege and preference over any other debt and are unalienable and do not prescribe.



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Contact a Contributing Author:
Sandra Salinas
C. R. & F. Rojas Abogados
Bolivia


Pablo Rojas
C. R. & F. Rojas Abogados
Bolivia


Disclaimer:

© 2024, C.R & F. Rojas. All rights reserved by C.R. & F. Rojas as author and the owner of the copyright in this chapter. C.R. & F. Rojas has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this Guide.

The information in the How to Hire and Fire Guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

Publication Date: February 2024