Hire employees and contractors in Uruguay

Remote’s guide to employing in Uruguay.

  • Capital city

    Montevideo

  • Currency

    Uruguayan peso
    ($U, UYU)

  • Population size

    3,518,552
    (est. 2019)

  • Languages spoken

    Spanish

  • Availability

    Remote-Owned Local Entity

    We own our own entity in the countries where we operate to shield your company from risk and provide you and your employees with the signature Remote experience.

Facts & Stats

The Oriental Republic of Uruguay (Spanish: República Oriental del Uruguay) is a democratic constitutional republic that boasts the 12th largest GDP in the Latin Americas, unrivalled levels of democratic freedom, press freedom, political stability, economic equality, and per capita income in South America.

With economic equality and poverty declining while GDP continues to rise, Uruguay is home to a developed workforce where enterprising businesses can expand to, with a positive economic outlook for the foreseeable future.

  • Capital city

    Montevideo

  • Currency

    Uruguayan peso
    ($U, UYU)

  • Languages spoken

    Spanish

  • Population size

    3,518,552 (est. 2019)

  • Ease of doing business

    Medium

  • Cost of living index

    51.09 (2021)

  • Payroll frequency

    Bi-Monthly/Monthly

  • VAT - standard rate

    22%

  • GDP - real growth rate

    0.2% (2019)

Grow your team in Uruguay with Remote

Remote currently offers contractor payment and management services in Uruguay. We are busy building our own entity in the country to provide you with best possible employment solutions for your employees.

Remote’s global employment solution makes it easy for your company to employ workers in Uruguay quickly, efficiently, and in full compliance with all applicable labor laws. We take on the responsibility and legal risks of international employment so you can focus on hiring great talent and growing your business.

Risks
of misclassification

Employing in Uruguay

Uruguay adheres to labor standards spelled out in the Constitution, several government edicts, and International Labor Organization statutes that are designed to provide employee protections and secure workers’ rights for Uruguay’s workforce of 1.6 million.

Common questions that could come up during the hiring process include minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Uruguay.

Public holidays

Date
Holiday Name
Extra information
Saturday, January 1, 2022New Years
Thursday, January 6, 2022Children's DayBanks and Government only
Monday, February 28, 2022CarnivalNot official day off but many employers give vacation
Tuesday, March 1, 2022Carnival
Thursday, April 14, 2022Maundy ThursdayTourism Week - vary every year
Friday, April 15, 2022Good FridayTourism Week - vary every year
Sunday, May 1, 2022Labor Day
Wednesday, May 18, 2022Battle of Las PiedrasBanks and Government only
Sunday, June 19, 2022Birth of Artigas
Monday, July 18, 2022Constitution DayMarks the promulgation of the First Constitution of Uruguay in 1830
Thursday, August 25, 2022Independence DayIndependence from the Empire of Brazil in 1825
Tuesday, October 11, 2022Columbus Day
Wednesday, November 2, 2022All Saints Day
Sunday, December 25, 2022Christmas

Minimum Wage

The minimum wage is fixed at 17,930 Uruguayan Pesos ($408.27) per month.

Payroll Cycle

For customers of Remote, all employee payments will be made in equal monthly installments on or before the last working day of each calendar month, payable in arrears.

Competitive benefits package in Uruguay

Remote can help you provide a competitive and compliant benefits package for your employees in Uruguay. If you have questions or would like to offer a custom benefit, let us know and we can help.

  • Medical insurance plan
  • Dental insurance plan
  • Vision insurance plan
  • Additional paid holidays
  • Flexible work schedule
  • Pension scheme
  • Life insurance
  • Other insurance

Taxes in Uruguay

Learn how employment taxes affect your payroll and your employees’ paychecks in Uruguay.

  • Employer

    • 5% - Health Insurance contribution

    • 0.1% - Labor Re-conversion Fund

    • 7.5% - Pension Fund contribution

    • 0.025% - Labour Credit Guarantee Fund

  • Employee

    • 15% - Pension Fund contribution

    • 3 – 8% - Health Insurance contribution

    • 0.1% - Labor Re-conversion Fund

  • Effective Personal Income Tax Rates

    • (in Uruguayan Pesos)

    • 0% - Up to 379,596 ($8643.40)

    • 10% - 379,596 - 542,280 ($8643.40 - $12347.72)

    • 15% - 542,280 - 813,420 ($12347.72 - $18521.57)

    • 24% - 813,420 - 1,626,840 ($18521.57 - $37043.15)

    • 25% - 1,626,840 - 2,711,400 ($37043.15 - $61738.58)

    • 27% - 2,711,400 - 4,067,100 ($61738.58 - $92607.87)

    • 31% - 4,067,100 - 6,236,220 ($92607.87 - $141998.73)

    • 36% - Above 6,236,220 (i.e., $141,998.73)

Types of leave

Paid time off

Employees are entitled to 20 days’ vacation annually, used in the year following the vacation accrual. After the fifth year of employment, an extra day off is acquired, with a day added every four years until it maxes out at 25 days’ vacation annually.

During their annual vacation, employees are entitled to their full wages, as well as vacation benefits equivalent to 100% of their normal wages.

Public holidays

There are 12 public holidays employees can take off work annually. Employees are entitled to mandatory paid time off on five of these holidays: January 1, May 1, July 18, August 25, and December 25, and must be paid overtime if required to work on a holiday.

Sick days

The first three days of an employee’s illness is compensated in full by the employer. Starting the fourth day of an illness, employees are entitled to sickness benefits equivalent to 70% of their normal wages.

Maternity leave

Female employees are entitled to 14 weeks’ of paid maternity leave starting six weeks before delivery, with benefits equivalent to their full wages paid by the social security office.

Paternity/Parental leave

Parents are entitled to just 13 days parental leave in total (of which 10 days are paid by Social Security and three by the employer).

Education leave

University students can take anywhere from six to 12 days off annually to attend to their studies, i.e., take examinations, process admissions, etc.

Other leave

  • Marriage leave: A newlywed employee is entitled to five days off, paid by employer
  • Bereavement leave: Employees can take three days off for the death of a close relative
  • Adoption leave: Adoptive parents are entitled to six weeks of continuous leave, with reduced working hours (50% reduction) for the six months following the adoption leave
  • Studies leave: Up to 10 days, the allotment depends on weekly working hours and is always paid by employer

Employment termination

Termination process

Employers have the right to terminate employees, provided prior notice is provided, along with a severance package.

Notice period

There is no officially stipulated notice period in Uruguay.

Severance pay

The figure varies based on whether the workers' payment cycle is monthly or daily (except for dismissal with cause, which in the Uruguayan system implies misbehavior by the employee). The length of employment agreement also impacts severance:

  • Fixed-Term Contracts: When employees work until the end of the term agreed in their labor contract, they won't be entitled to severance compensation. In case they are terminated earlier, salaries until the end of the term agreed must be paid.
  • Indefinite Term Contracts: Employees are entitled to severance payments which includes one months salary for every year employed up to six months of salary.

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