Definitive Guide to Hiring in Cuba

Hiring in Cuba

Hiring employees compliantly in Cuba means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Cuba so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Cuba; or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Labor Laws in Cuba

Employment laws in Cuba are uniquely suited to the country’s way of life, and crucial to understand if you want to employ local talent in this country. Get the details on Cuba employment laws and Cuba policies here.

Employee Probation Period

• Probationary period cannot exceed 6 months

Annual Leave in Cuba

• An employee is entitled to annual leave in accordance with their employee contract with a minimum of 21 days/year being granted.

Holidays in Cuba

Workers are entitled to paid holidays during Festival (public and religious) holidays. These include memorial holidays and religious holidays (Christian origin).

Here is the full list of public holidays in Cuba:

Maternity Leave Cuba

• Pregnant women are entitled to 18 weeks fully-paid leave (six weeks before birth and 12 after), plus an additional 40 weeks at 60% pay, assured of returning to their same job.

Paternity Leave Cuba

• Fathers are entitled to 12 to 40 days of paternity leave at 60% of pay

Sick Leave in Cuba

• An employee is entitled to sick leave with full pay of up to 30 working days in a three-year period.

Working Hours in Cuba

• Cuba has a 44 hour working week

Termination of Employment in Cuba

Article 45 provides that the employment contract may end due to:

• agreement of the parties;
• initiative of any of the parties;
• retirement of the worker;
• death of the worker;
• extinction of the entity, when there is no other subrogated in its place; and
• expiration of the fixed term or the conclusion of the agreed work, in the case of fixed-term contracts or for the execution of a job or work.

• Moreover, article 49 of Labor Code provides that the employment contract might be terminated by the employer due to:
  • loss of proven suitability;
  • definitive relocation outside the entity of the available worker, or when the proposed employment is not unjustifiably accepted by the worker, or when the salary guarantee period expires without having been employed;
  • definitive relocation outside the entity of the worker who is declared a person with a partial disability; non-suitability of the partial disability for a job offer according to the worker´s capacity inside or outside the employer or disapproved requalification, in both cases, for unjustified reasons;
  • application of the definitive separation measures of the entity or sector or activity, when appropriate, due to the non-observance of the disciplinary norms established in the legislation and in the disciplinary regulations;
  • Compliance with the term of the maternity leave or, where appropriate, the social benefit or unpaid maternity leave, in the terms and conditions established in the legislation, without the worker who has enjoyed it being reinstated to the job;
  • Sanction of deprivation of liberty by final sentence or security measure, in both cases when it exceeds six months, if the employer so decides;
  • non-reinstatement upon expiration of the unpaid leave granted by the employer; and
  • other causes provided for in the legislation.

Notice Period in Cuba

In the event of the Cuban employee's resignation, if the contract is for an indefinite period he is obliged to give the employer thirty days' notice, with fifteen days for temporary contracts.

Severance in Cuba

• There is no indication of severance payment or redundancy payment of such kind
• However, according to article 52 of Labor Code, the worker, at the time of termination of the employment relationship, has the right to receive the salary for the work performed, the amount of the accumulated for annual paid vacations, as well as that corresponding to the provision of security social that had been perceiving.

Cuba Salary and Wages

13th Month Salary in Cuba

• No
• There is no statutory requirement to pay the 13th or the 14th month.
• The labour code is geared at ensuring workers productivity, the bonuses that are prescribed in the code detail the manner in which those bonuses will be paid to eligible employees.

• Employers and employees make contribution to Cuba social security program that covers special systems for armed forces personnel, interior ministry staff, self-employed persons, certain artists, musicians, and members of agricultural and nonagricultural cooperatives.
• Employees contribute 1% to 5% of earnings
• Public Sector employers contribute 12.5%
• Private sector employers contribute 14.5%

Immigration Cuba

• If you are thinking about working in Cuba, you will need to apply for a work visa in advance.
• This is applicable to almost every nationality.
• There are multiple types of work visa available, so ensure you are choosing the correct one for your profession.
• The types of work visa available for Cuba are as follows:
  • D-1 visa for employees with technical, scientific, or other specialized qualifications
  • D-2 visa for students and scientists
  • D-3 visa for artists
  • D-4 visa for athletes
  • D-5 visa for asylum seekers and refugees
  • D-6 visa for journalists
  • D-7 visa for traders and businesspeople
  • D-8 visa for religious workers
  • D-10 visa for medical tourists
• Official visit visas or ‘diplomat visas’ are also available for Cuba, but are only applicable to diplomats, ambassadors and politicians visiting from other countries.
• Many people find it difficult to get a work visa for Cuba, unless they have a contract offer prior to applying, or have relatives who are Cuban citizens.

Value Added Tax (VAT) in Cuba

• There is no VAT in Cuba but there is a sales tax whose rate varies depending on the type of the product.
• A tax rate of 2% is applied on wholesale sales, 10% on retail sales and 10% on services.
• Consumer goods serving as raw materials for industry or destined for export are exempted.

Mandatory Benefits in Cuba

• These are mandatory benefits as postulated by law
• These include probationary period, annual leave, public holidays, sick leave, maternity leave, paternity leave, overtime pay, notice period, severance pay and 13th month pay
• Mandatory benefits also include social security benefits.

Payroll Accrual in Cuba

Country Accruals Additional Information

Description

Special systems for military personnel, interior ministry staff, certain self-employed persons, certain artists, musicians, and members of agricultural cooperatives.

Payroll Accruals Additional Information

Accrued Benefits in Cuba

Why use Global Expansion to hire in Cuba

Establishing a branch office or subsidiary in Cuba can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Cuba labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Cuba law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Cuba. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Cuba Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.