Hire Employees in Peru

Your own entity is normally an SAC. Incorporation is straightforward, but it commits you to Peruvian corporate tax, monthly PLAME filings and affiliation to EsSalud and a pension system chosen by the employee.

An Employer of Record inverts the sequence: the Peruvian entity signs the contract, registers the employee in the T-Registro, pays EsSalud and administers gratificaciones and CTS — while you direct the day-to-day work.

Peruvian labour law applies to work performed in Peru, and the doctrine of primacía de la realidad means the operating facts of the relationship displace the contract wording where they conflict.

Peru's 9% EsSalud contribution is the smallest part of the picture, and using it as the employer cost is the most common error foreign employers make here. Total employer cost runs to roughly 150% of monthly gross across the year once the statutory stack is counted.

Two gratificaciones — full monthly salaries paid in July and December — add two months. CTS, a severance savings deposit of about a month a year made in May and November, adds another. Thirty calendar days of vacation, asignación familiar for employees with dependent children, and SCTR cover for high-risk activities sit on top.

The gratificaciones carry a further twist. They are exempt from EsSalud, but the employer must pay a bonificación extraordinaria of 9% of the gratificación — 6.75% where the employee is covered by an EPS — directly to the employee rather than to the state. It is easy to miss because it looks like a contribution and behaves like salary.

Primacía de la realidad is the doctrine that governs contractor arrangements. Peruvian courts look at how the relationship actually operates rather than what the recibo por honorarios says, and reclassification brings the entire stack retroactively — gratificaciones, CTS, vacation and contributions from the original start date.

Break-even rule of thumb: EOR fees begin to exceed the running cost of a small Peruvian entity somewhere between 15 and 20 employees. Model both before committing — see EOR vs Entity for the full comparison, and plan any later migration so employees keep seniority.

EsSalud at 9% is the smallest part of the picture and using it as the employer cost is the most common error here. Total employer cost runs to roughly 150% of monthly gross across the year.

Two gratificaciones — full monthly salaries paid in July and December — add two months. CTS, a severance savings deposit of about a month a year made in May and November, adds another. Thirty calendar days of vacation, asignación familiar for employees with dependent children, and SCTR cover for high-risk activities sit on top.

The gratificaciones carry a further element that looks like a contribution and behaves like salary. They are exempt from EsSalud, but the employer must pay a bonificación extraordinaria of 9% of the gratificación — 6.75% where the employee is covered by an EPS — directly to the employee.

One Peruvian mechanism is easy to misread as an extra cost when it is not. Gratificaciones are exempt from EsSalud, AFP and ONP, so the employer does not pay the 9% to EsSalud on them. The law instead requires that identical 9% to be paid straight to the worker as a bonificación extraordinaria. The employer’s outlay is the same either way — only the recipient changes. The rate drops to 6.75% where the worker is covered by an EPS rather than EsSalud, since part of the health contribution already flows there. The bonificación is non-remunerative, so it does not feed into CTS or holiday pay, and it applies to the gratificación trunca on termination as well. SUNAFIL enforces it, and omission is a serious infraction.

Four representative profiles, costed with the 2026 contribution rates above. Salaries are illustrative market midpoints, not GX operating data — use them to see how the on-cost percentage behaves as pay rises, not as a salary benchmark for a specific role. For real market data on your roles, ask for a costing.

Watch the on-cost percentage rather than the absolute figure. 1 of the charges here are capped and 6 are not, so the effective employer rate falls as salary rises — but it flattens rather than disappearing. The senior rows below show where it settles.

Four representative profiles costed on 2026 statutory rates. Salaries are illustrative market midpoints, not GX operating data.

Payroll runs monthly in soles, with gratificaciones in July and December and CTS deposits in May and November. Contributions and withheld income tax are declared through PLAME, and every employee must first appear in the T-Registro.

Income tax operates on an annual projection rather than a monthly table. The employer estimates the employee’s annual income at the start of the year, calculates the tax, and withholds it in instalments, adjusting as circumstances change. A mid-year salary rise therefore requires the projection to be recalculated rather than simply applying a higher rate going forward.

The first 7 UIT of annual income is deductible, with the UIT uprated each year, and additional deductions apply for certain documented expenses.

Thresholds and ceilings are uprated periodically, so a figure correct in January may not hold later in the year. Where a row below is flagged, published sources disagreed and the conflict is recorded rather than resolved.

Thresholds move on a local cycle that does not always fall in January, so a figure correct at the start of the year may not hold through it. Where a row below carries a flag, published sources disagreed and the conflict is recorded rather than resolved — there are 2 such rows on this page.

The sections that follow set out contracts and probation, working time, leave, termination and immigration in that order. Where an entitlement comes from a collective agreement rather than statute it is marked as such, because that distinction determines whether it is negotiable.

The framework sits across several statutes rather than a single code: the Legislative Decree on labour productivity and competitiveness governs contracts and dismissal, separate laws cover CTS and gratificaciones, and SUNAFIL enforces through inspection. That fragmentation means an entitlement can exist without appearing in the obvious place, which is why the payroll stack here is larger than the contribution rate suggests.

A written contract is required for fixed-term arrangements and must be registered with the Ministry of Labour. Indefinite contracts may be verbal in principle but are written in practice.

Peru permits fixed-term contracts only on a listed ground — start of activity, market need, business reconversion, specific service, seasonal work and others — and the ground must be stated in the contract. A fixed-term contract without a valid stated ground is treated as indefinite from the outset.

Probation is three months, extendable to six for qualified roles and twelve for management or trust positions, and any extension must be agreed in writing before the initial period expires. During probation the employee has no protection against arbitrary dismissal.

Eight hours a day and 48 a week, among the longer statutory weeks in Latin America. Overtime is voluntary and paid at a 25% premium for the first two hours and 35% thereafter, or compensated with time off by agreement.

Overtime is where payroll disputes usually start. Record hours from day one even where the role is salaried and the expectation is that overtime will not arise — reconstructing records after a complaint is far harder than keeping them.

Overtime is where payroll disputes usually begin, and the burden of proving hours worked generally sits with the employer. Record hours from the first day even for salaried roles where overtime is not expected — reconstructing a record after a complaint is considerably harder than keeping one.

Public holidays sit on top of the annual leave entitlement. Where a holiday falls at a weekend, practice varies — some markets move it, some grant a substitute day and some do neither, so check the position before assuming a day in lieu.

The 14 dates below are the statutory position. Employers in many markets grant more by policy or collective agreement, and sector agreements sometimes add local or patronal days that do not appear in a national list.

Peru observes 14 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.

Maternity: 98 days — 49 before and 49 after the birth — Paid by EsSalud, not the employer, subject to a contribution history. Paternity: 10 calendar days, extended for complications or multiple births — Employer-paid. Sick leave: From day 1 — The employer pays the first 20 days in a year; EsSalud pays thereafter. Breastfeeding: 1 hour a day until the child is 1 — Paid, and treated as time worked.

Bereavement: Set by company policy or collective agreement — Not a general statutory entitlement.

The question that matters for budgeting is who funds each entitlement. Where the state or a social insurance fund pays, the employer carries administration but not cost; where the employer pays, it is a direct charge that headcount models routinely omit. Both patterns appear above.

Peru does not permit dismissal without cause. The Labour Code lists grounds relating to conduct and capability, and each carries a prescribed procedure: written notice of the allegations, a period of not less than six calendar days for the employee to respond, and a reasoned decision.

Dismissal without a valid cause is arbitrary dismissal, and the employee may claim either compensation or reinstatement. Compensation is one and a half months' salary per year of service capped at twelve months, and the Constitutional Tribunal has upheld reinstatement as an available remedy where the dismissal was arbitrary in a constitutional sense.

CTS operates as a portable severance fund. Deposits are made twice yearly to the employee's chosen bank, and the accumulated balance belongs to the employee — it is not offset against arbitrary dismissal compensation, so the two are cumulative rather than alternative.

The final settlement must include proportional gratificación, outstanding CTS and accrued vacation, and vacation not taken attracts an indemnity equal to a further month.

A foreign national needs a work visa and a contract approved by the Ministry of Labour before starting. The contract has a maximum term of three years, renewable.

Foreign employees are limited to 20% of headcount and 30% of total payroll, with exemptions available for specialist and management roles and for employees married to Peruvian nationals or with Peruvian children. Those exemptions must be claimed rather than assumed.

Allow one to three months. Mercosur and Andean Community nationals follow simplified routes that avoid the quota calculation entirely.

Arbitrary dismissal is the central exposure. Peru does not permit dismissal without cause, and where a dismissal is found arbitrary the employee may claim compensation of one and a half months’ salary per year of service capped at twelve months — or, in constitutional cases, reinstatement.

CTS is the operational risk with the tightest deadline. Deposits are due in the first fifteen days of May and November, and the obligation is one of the most routinely audited in Peruvian payroll.

Practical controls: budget at 150% of monthly gross rather than 109%, state a valid ground in every fixed-term contract, deposit CTS inside the window, and follow the six-day written response procedure before any conduct-based dismissal.

Work backwards from the start date. For a Peruvian national through an EOR, one to two weeks is realistic. A foreign national needs a work visa and a contract approved by the Ministry of Labour, adding one to three months.

Confirm before making an offer: that the budget carries roughly 150% of monthly gross across the year rather than 109%; whether the foreign staff quota applies, since foreign employees are limited to 20% of headcount and 30% of payroll; and which pension system the employee will elect, ONP or an AFP.

EsSalud registration and pension affiliation must precede the first payroll. CTS deposits are due in the first fifteen days of May and November, and missing the window attracts interest and a labour inspection finding — it is one of the most routinely audited obligations in Peruvian payroll.