What do you need to know to hire in Chile?
The Chilean working week is mid-cut to 42 hours under the 40-hour law, on the way to 40 by 2028. Get a dismissal wrong and a court can lift severance by up to 100%. Each guide below takes one layer.
· Chile guide
How does Teamed handle Chilean hiring for you?
Teamed becomes your legal employer of record in Chile for from $599 per employee per month, with zero FX mark-up in any currency.
Payroll, contracts, and the full Chilean employment law stack run on one platform.
Real HR and legal experts manage every Chilean hire, from the first offer letter to the final settlement. An actual person, not a chatbot or a pooled queue, handles your Chilean team alongside EOR, contractor onboarding, and entity payroll on one platform. There is no setup fee and no exit fee. Employer cost passes through at cost, itemised on every invoice.
A Chilean contractor who converts to employment keeps their record, and that same employee can graduate to your own Chilean entity without re-onboarding. Run the Crossover Calculator to see the month the model flips. EOR is the right model for a first Chilean hire, until it isn't.
- Chile has no general probation period. Most countries let you trial a new hire for a month or three. Chile does not. The only trial period in the law is two weeks, and it applies to domestic workers alone (Código del Trabajo Art. 147). Every other employee has full protection from day one. Most EOR guides skip this and leave US buyers planning a probation that does not exist.
- The working week is in the middle of a legal cut. Ley 21.561 took the maximum ordinary week to 42 hours on 26 April 2026 and lands it at 40 from 26 April 2028. Guides written before 2024 still quote 45. The hiring guide tracks the staged drop.
- There is no 13th-month salary in Chile. What you owe instead is the gratificación legal, a profit share worth at least 30% of net annual profit, or a capped monthly alternative (Código del Trabajo Art. 50). Budget it as a real line, not a bonus. The cost breakdown guide gives the full picture.
Chile runs a monthly payroll in pesos. The minimum wage is CLP 539,000/month for workers aged 18 to 65.
The maximum ordinary week is 42 hours and falling to 40 by 2028. Paid annual leave is 15 days after one year of service.
Dismissal needs a legal cause. On business-needs grounds you give 30 days notice or pay it out, plus severance of 30 days of pay per year, capped at 330 days.
Teamed runs Chilean payroll, contracts, and compliance through a vetted local partner entity. This page is the map. Each guide below is the detail.
Zero FX. No setup fees. The price your finance team can forecast against without an asterisk, in any currency pairing.
How much does it cost to hire an employee in Chile in 2026?
Plan on salary plus employer-side contributions and the gratificación profit share on top.
The minimum wage is CLP 539,000/month. Employer cost sits inside Teamed's total envelope, not outside it.
Chile funds pensions and most social security from the employee's pay, so the employer-side load is lighter than in much of Europe. The employer carries work accident insurance from a base rate of 0.9%, plus a variable risk add-on set by SUSESO, and the employee's 7% health contribution is withheld from salary. The gratificación legal adds a real annual cost, worth at least 30% of net annual profit or the capped monthly alternative.
Teamed's Chile price is a starting rate, with zero FX in any currency pairing. No setup fees. No exit fees. Salaries, taxes, and benefits passed through at cost on every invoice.
The full breakdown, with worked examples at current rates, is in the cost guide.
Do you need a Chilean entity to hire employees in Chile?
No. An Employer of Record runs Chilean payroll and contracts from day one.
Your own Chilean entity becomes cheaper than EOR once headcount in-country grows, depending on salary.
Registering a Chilean company means incorporation, a RUT tax number with the SII, registration with the AFP pension and health systems, and ongoing monthly filings. Setup runs to weeks and carries fixed local accounting cost from then on. An Employer of Record is faster and cheaper at low headcount. Teamed runs Chilean payroll, contracts, and compliance through a vetted local partner entity from day one.
The crossover point depends on Chilean salary levels and your local accounting costs. The EOR vs entity guide runs those numbers for your situation.
Most EOR providers will not tell you when you have crossed it. We do, and we help you move. You progress from contractor to EOR to your own Chilean entity on one platform under Teamed's Graduation Model, with tenure preserved.
What changed in Chilean employment law recently?
The biggest change is the 40-hour law. The maximum ordinary week dropped to 42 hours on 26 April 2026.
It steps down again to 40 by 26 April 2028. Roster every hire against the current ceiling, not the old 45.
Ley 21.561 phases the working week down in stages. It moved from 44 hours to 42 hours on 26 April 2026 and reaches 40 from 26 April 2028 (Ley 21.561). The minimum wage rose to CLP 539,000/month for workers aged 18 to 65 from 1 January 2026 under Ley 21.751. That same law asked the government to send a further wage rise targeted at May 2026. As of this review that bill is still in Congress with no set amount, so the current legal figure stands.
The hiring guide and the tax and payroll guide cover each current rule in detail, with the staged dates laid out.
What benefits must you provide Chilean employees in 2026?
The floor is 15 days of paid annual leave after one year of service.
Maternity rest is 6 weeks before birth and 12 weeks after, plus a further 12 weeks of parental leave.
Paid annual leave is 15 days of working days per year after twelve months of service, with extra days in the far-south zona extrema (Dirección del Trabajo). Retail and commerce staff also get 5 days non-waivable holidays they cannot be asked to work, set by Ley 19.973.
Maternity rest runs 6 weeks before delivery and 12 weeks after, then a parental leave of 12 weeks, extendable at half-time (Código del Trabajo Art. 195). Sick pay carries a short waiting gap. The first 3 days of a short medical leave draw no subsidy unless the leave runs past ten days. The benefits guide covers each entitlement in full.
Read the full Chile benefits guide
What are payroll taxes in Chile in 2026?
Income tax is withheld monthly on a progressive scale. The first band is 0%.
The top rate is 40%, and the employee's 7% health contribution comes off the same payslip.
Employees pay the Impuesto Único de Segunda Categoría, a progressive monthly tax that starts at 0% on the lowest band and rises to 40% at the top (SII). Pension and health sit on the employee side too. The employer withholds 7% for FONASA or an ISAPRE health plan, plus the AFP pension contribution.
On the employer side, work accident insurance starts at a base rate of 0.9% with a variable add-on by risk class. Teamed runs the full withholding and remits to the SII and the social security funds. The tax and payroll guide sets out every band and threshold.
How do you terminate an employee in Chile?
You need a legal cause to dismiss. On business-needs grounds you give 30 days notice or pay it out.
Severance is 30 days of pay per year of service, capped at 330 days.
Chile is a cause-based system. A dismissal must rest on one of the legal grounds in the labour code. For business-needs terminations under Art. 161 you give 30 days written notice, with a copy to the labour inspectorate, or pay the last month's salary instead (Código del Trabajo Art. 162). Severance for years of service is 30 days of the last monthly pay per year worked, capped at 330 days (Art. 163).
Get the ground wrong and the bill climbs. A court can lift severance by 30% for a wrongly applied business-needs ground, and by up to 100% where it finds a misconduct dismissal had no plausible motive (Art. 168). The termination guide runs the full process.
What should you know before hiring in Chile?
Two things catch US buyers out. The first is that Chile has no general probation period.
The second is that a dismissal a court finds groundless can cost up to 100% more in severance.
There is no trial period for a normal hire. The only probation in the labour code is a two-week one for domestic workers (Código del Trabajo Art. 147). Everyone else has full protection from the first day. Plan the hire as a real commitment, not a test run.
A weak dismissal ground is expensive. If a court rules the cause improper, it adds 30% to severance for a business-needs ground and up to 100% for a misconduct dismissal with no plausible motive (Código del Trabajo Art. 168). Document the cause before you act. The hiring guide and the termination guide both cover safe process.
Frequently asked questions
How much does it cost to hire an employee in Chile?
Plan on salary, employer work accident insurance from a base rate of 0.9%, and the gratificación profit share worth at least 30% of net annual profit. The minimum wage is CLP 539,000/month for workers aged 18 to 65. Teamed's Chile fee is one flat number per employee per month, with zero FX mark-up in any currency pairing. The cost breakdown guide has worked examples.
Can a US company hire in Chile without an entity?
Yes. An Employer of Record like Teamed runs Chilean payroll, contracts, and compliance through a vetted local partner entity. You direct the work. Teamed becomes the legal employer of record. Registering your own Chilean company takes weeks and requires a RUT with the SII plus AFP and health registration and ongoing monthly filings.
Is there a probation period in Chile?
No, not for a normal hire. Chile's labour code has no general probation period, so a new employee has full protection from day one. The only trial period in the law is a two-week one for domestic workers under Código del Trabajo Art. 147. Plan any hire as a real commitment, not a test run.
What is the statutory notice period in Chile?
For a business-needs dismissal under Art. 161 you give 30 days written notice, with a copy to the labour inspectorate, or pay the last month's salary instead. A dismissal must rest on a legal cause. Severance for years of service is 30 days of pay per year worked, capped at 330 days.
Does Chile have a 13th-month salary?
No. Chile has no 13th-month or 14th-month salary. Instead employers owe the gratificación legal, a profit share worth at least 30% of net annual profit, with a capped monthly alternative. Budget it as a real cost line. The tax and payroll guide sets out both options.
What is the working week in Chile in 2026?
The maximum ordinary week is 42 hours. Ley 21.561 cut it from 44 to 42 hours on 26 April 2026 and lands it at 40 from 26 April 2028. Paid annual leave is 15 days of working days per year after one year of service.
Chile reads as employer-light on paper because pensions and health come off the employee's pay. The cost lands somewhere else. There is no probation to lean on, the working week is mid-cut, and a dismissal the court dislikes can add up to one hundred percent on top of severance. None of that is hard once you know it. All of it is costly when you do not.
Chile gives you no probation period, a working week falling to 40 by 2028, and a severance top-up that can reach 100 percent on a dismissal a court finds groundless.
Most of the cost surprises come from planning around rules that no longer apply.
Read the right Chile guide before the first hire, not after the first claim.
