Labor Law in Panama


Kraemer & Kraemer has the knowledge and experience to assist you, whether you want to draft a labor contract, layoffs, or labor lawsuits.

In this section, we focus on key aspects of labor law in Panama. Our legal team is ready to guide you through the process fitting your circumstances.

Panama labor law highlights

  • In Panama, “employment” is defined by the circumstances of whether the person is subordinate or dependent economically on his/her employer.
  • The Ministry of Labor and Labor Development (MITRADEL) is in charge of overseeing all labor-related matters in Panama.
  • It is recommended to have a written contract: Although Panamanians can be hired without a written contract, it is not recommended because in case of a dispute, under Panama’s labor law the employee’s version of events will be presumed correct unless the employer can prove otherwise with solid proof.
  • Depending on the location and type of job, Panama’s minimum wage is around $2 USD per hour.
  • In Panama, 8 hours is the maximum amount of time for a day shift, while for a night time worker is 7 hours.
  • Wages can be subjected to income tax, social security tax, and an education fund.
  • There is a bonus known as the “13th month” which is one month’s wages annually for employers.

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Our team of legal experts in labor law is ready to assist you. Send us a note to if you have any questions about labor in Panama or if you are ready to start a legal process with us.