Employment Contracts in Panama


An employment contract is a verbal or written agreement whereby a person undertakes to render services or perform work for another person.

According to the Ministry of Labor and Labor Development (MITRADEL), all labor contracts must meet the requirements established by the Labor Code of Panama. All contracts must include:

  1. Name, nationality, age, sex, marital status, domicile, and identity card number of the parties. When the employer is a legal entity, its name or corporate name, its domicile, the name of its legal representative, and its registration data in the public registry must be stated.
  2. Name of the worker’s dependents.
  3. Specify the work or services contracted and the modalities related to them.
  4. Place or places where the service is to be rendered.
  5. Contract duration if it is for a fixed term or the corresponding statement if it is for an indefinite term.
  6. Duration and regular division of the working day.
  7. The salary, form, day, and place of payment.
  8. Place and date of celebration
  9. Signature of the parties if they are able to do so.

Duration of employment contracts

Employment contracts may be for an indefinite term, for a definite term, or for a specific work.Definite-term contracts must be executed in writing and the term may not exceed one year.

A contract will be considered indefinite if:

  1. Upon expiration of the term of a contract for a definite term, the employee continues to render services.
  2. If the worker continues rendering the same tasks after the work is concluded.
  3. When successive contracts are entered for a definite period of time or for a specific work.

Contact us

Our legal team can assist you in drafting employment contracts so they meet all the requirements established by MITRADEL. Send us a note to info@kraemerlaw.com to start the process or to clarify any doubts.