Hire Employees in Cuba

Since 3 September 2026, investment entities can hire directly. Decree-Law 128/2026 and MTSS Resolución 56/2026, published in Gaceta Oficial Ordinaria No. 73, amended the Foreign Investment Law so that joint ventures, wholly foreign-owned companies and parties to international economic association contracts may hire Cuban citizens and permanent residents directly. A company that does so becomes the employer and must meet general Cuban labour and social security law, including the new Código de Trabajo from 25 September 2026.

The state employing agencies remain available but are no longer mandatory for those entities. ACOREC S.A., Almacenes Universales S.A. and ZELCOM S.A. can still supply labour under Resolución 20/2015, and where one is used it, not the foreign company, is the legal employer. Whether a foreign company's branch or representative office, which is not an investment form under the Foreign Investment Law, may also hire directly should be confirmed before relying on it.

GX offers an Employer of Record service in Cuba, so you can hire without first setting up a joint venture or wholly foreign-owned company.

The choice in Cuba is wider than EOR or entity. Since Decree-Law 128 of 3 September 2026, an investment entity can hire directly. Otherwise the options are GX's Employer of Record service, working through a state employing agency, contracting with a Cuban private business as a supplier of services, or not operating in the market.

The agency model has a documented commercial consequence. The foreign entity pays the agency a fee, typically in convertible currency; the agency pays the worker in Cuban pesos against MTSS scales. Cuban state media has carried readers reporting that workers receive a small fraction of what the agency charges, and independent reporting has put historic examples at several hundred dollars charged against a peso salary worth a fraction of that.

The policy rationale has been stated openly by the government. Foreign Trade Minister Rodrigo Malmierca has said the agency route reflects a deliberate aim that Cubans working for foreign investors should not earn substantially more than counterparts in state enterprises, describing these as internal decisions the authorities do not intend to change despite foreign investors disliking them. Decree-Law 128 of 2026 relaxed that position for investment entities by making the agencies optional.

The practical question is which route fits your operation: GX as Employer of Record, direct hiring through an investment entity, or a state employing agency. The calculator above gives the employer contributions for direct hiring.

Private-sector employers pay 19%. A MIPYME or cuentapropista pays a 5% tax on the utilisation of labour and a 14% social security contribution. Cuban commentary describes these as high enough for small businesses to act as a disincentive to formal hiring.

For a foreign entity the cost is not a contribution rate at all. It is a negotiated fee paid to the employing agency, set by contract between the agency and the foreign company. The salary the worker receives is fixed separately against MTSS scales and cannot fall below the scale for the post.

Employees pay a Contribución Especial a la Seguridad Social of 5% of gross monthly salary, plus personal income tax.

Note that salary guarantees paid to workers are generally exempt from personal income tax and the special social security contribution, with defined exceptions including staff contracted by employing entities to work in foreign investment and in the Mariel Special Development Zone.

Salaries are administered rather than market-set. For staff supplied to foreign entities, pay is agreed between the employing agency and the foreign company by reference to complexity, working conditions and the requirements of the post, and cannot fall below the MTSS scale.

Salaries for staff supplied to foreign entities are fixed by agreement between the state employing agency and the foreign company, and cannot fall below the MTSS scale for the post. The agency fee charged in hard currency is negotiated separately and is not the amount the worker receives.

The state employing agency runs payroll and pays workers in Cuban pesos. Where the role justifies it, language use, abnormal working conditions, irregular hours, or particular experience and qualification, the agency may set a salary above the scale for the post, provided it corresponds to a post of greater complexity and does not create salary incongruence.

Contracts with the employing agency run for a maximum of five years. At the request of the foreign entity, renewal for a further equal period may be assessed; approval carries both a salary increase for the worker and an increase in the fee charged to the foreign company. Beyond that maximum, shorter contracts for a specific task or work may be used.

Overtime is paid at double the hourly or daily wage depending on the time worked. The former concept of voluntary work has been replaced by extraordinary work.

Cuba operates multiple exchange rates, and the rate applied to agency fees, salaries and any hard-currency element materially affects the real value of each. Confirm the applicable rate rather than assuming a single conversion.

Employees pay personal income tax alongside the 5% special social security contribution. Rates and thresholds are set by the Ministerio de Finanzas y Precios and should be confirmed directly, since the position has moved with successive monetary and wage reforms.

A new Código de Trabajo, Law 189, takes effect on 25 September 2026, after publication in Gaceta Oficial Ordinaria No. 78 on 18 September and a draft presented by the MTSS in September 2025 and consulted with workers across the island. It replaces the framework built on Ley 116/2013 and makes several substantive changes.

It applies universally for the first time. MIPYMES, cooperatives, local projects and cuentapropistas are expressly included as employers subject to labour obligations, alongside state and mixed entities.

The figure of the trabajador disponible, the status in which a worker awaited redeployment on 60% of salary, is abolished and replaced by a salary guarantee equivalent to six times the basic salary of the last year. Teleworking is regulated for the first time, pluriempleo is recognised so a worker may hold more than one job, and mediation is added alongside the Órgano de Justicia Laboral de Base for resolving disputes.

All employment relationships must be formalised in writing. Cuba is stricter than most jurisdictions here: verbal contracts are not a workable alternative, and the new Code reinforces the obligation on every category of employer.

Written contracts are mandatory. For staff supplied to foreign entities the contract is between the worker and the employing agency, not the foreign company.

The agency selects and supplies personnel judged to have demonstrated suitability for the post. Where a worker is subsequently found to have lost that suitability, the agency ends the relationship and the worker receives a guarantee equivalent to one month of the corresponding scale salary from notification, with a right to challenge the finding.

The principle of employment stability means no worker may be dismissed without a justified and properly evidenced cause.

The standard working week is 44 hours. Extraordinary work, the term that replaced voluntary work, is paid at double the hourly or daily wage depending on the time worked.

Teleworking, previously regulated by Resolución 71/2021, is now regulated under the 2026 Código de Trabajo, having expanded since the pandemic.

Rest periods and working time limits apply under the Code, with pluriempleo permitted only where the obligations of the principal post are met and schedules are compatible.

Cuba observes nine public holidays in 2026, including two days around the anniversary of the Revolution in late July.

Cuba observes nine paid public holidays in 2026. Dates that fall at a weekend and any substitution rules are set out below; entitlement is separate from annual leave.

Social security provides pensions, sickness and maternity benefits, funded by the employer contribution and the 5% employee special contribution.

A technical change lands in 2026. The MTSS has confirmed that with five years elapsed since the salaries approved under the monetary reform took effect, article 26 of the Ley de Seguridad Social again applies to the calculation of average monthly salary, which affects how pensions are computed.

Pensions for age and invalidity were increased under Resolución 14/2025, published in December 2025.

Dismissal requires a justified and evidenced cause under the principle of employment stability. Disputes go to the Órgano de Justicia Laboral de Base, with mediation now available as an alternative under the 2026 Code.

For agency-supplied staff, termination is effected by the employing agency rather than the foreign company. Loss of suitability for the post carries a guarantee of one month of scale salary.

The abolition of trabajador disponible status replaces an open-ended 60% arrangement with a defined guarantee of six times the basic salary of the last year.

The 2026 Code introduces fines of 20 to 40 cuotas for cuentapropistas and 40 to 60 for MIPYMES that breach labour rights, fail to pay social security or hire informally.

At least 85% of personnel in foreign investment entities must be Cuban nationals or permanent residents. A lower proportion may be approved only exceptionally, after union consultation and with MTSS authorisation.

Foreign nationals and stateless persons who are permanent residents in Cuba are treated as local personnel for these purposes and are contracted through the employing agency in the same way.

A foreign national accredited to represent the foreign entity in Cuba is registered separately as a representative rather than employed through an agency.

The structural risk has changed. Until 3 September 2026 state employing entities held a legal monopoly on supplying Cuban labour to foreign entities. Decree-Law 128 of 3 September 2026 ended that for joint ventures and wholly foreign-owned companies, which may now hire directly and take on full employer obligations under the Código de Trabajo that applies from 25 September 2026.

Informality is the second. Data from the national statistics office puts 831,063 Cubans in informal work, around 90% of them in the private sector. Engaging individuals informally leaves them without protection and the counterparty exposed under the new Code’s penalty regime.

Exchange rate exposure is unusually acute. Cuba operates multiple rates, and the divergence between the rate applied to an agency fee and the rate at which a peso salary is valued is the mechanism by which the state retains the difference. Model the arrangement in both currencies.

Note also that the new Código de Trabajo takes effect on 25 September 2026, with 90 days for employers to adapt contracts, that the operating environment has been affected by fuel and energy disruption during 2026, and that sanctions regimes may restrict what a foreign company can lawfully do irrespective of Cuban law.

Start by establishing whether you can operate in Cuba at all. Sanctions and export-control regimes in your home jurisdiction may restrict dealings with Cuban entities regardless of what Cuban law permits. That question comes before any employment structuring.

If it does, decide whether to hire directly through a joint venture or wholly foreign-owned company, as Decree-Law 128 of 3 September 2026 allows, or through an authorised employing agency. On the agency route, contract terms, salary scales and the fee are negotiated between the agency and your company, and the five-year contract maximum should be planned for from the outset.

Where the requirement is for discrete deliverables rather than staff, contracting with a Cuban MIPYME as a supplier may be a cleaner route, but the relationship must be commercial, without the direction and control that would characterise employment.