A Dominican Republic Employer of Record (EOR)  streamlines hiring and ensures compliance with labor laws. Businesses can focus on core operations while the EOR manages HR tasks, payroll, and statutory requirements. It provides a cost-effective way to establish a local presence without setting up a legal entity, making it ideal for short-term projects or market exploration. 

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Businesses engage with a Dominican Republic Employer of Record (EOR) or Professional Employer Organization (PEO) to hire talent from the country without violating local compliance.

Most employment laws in the Dominican Republic do not pose a severe challenge to foreign employers. However, some laws that exist to protect employee rights around bonuses, social security and union rights can stump even experienced employers. Any non-compliance in these areas will attract hefty fines from the labor ministry. Secondly, setting up an entity in the Dominican Republic can set back employers by thousands of dollars and several months. Incorporating the company, opening a bank account can all slow your hiring process.

By teaming up with a Dominican Republic EOR/PEO, companies can adhere to all local regulations, and strategically position themselves for rapid growth. This partnership offers valuable resources and support, allowing businesses to focus on core activities and achieve their expansion objectives efficiently.

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The pricing of Dominican Republic Employer of Record (EOR) or Professional Employer Organization (PEO) services can vary depending on factors like the number of employees, the scope of services required, and the complexity of the project. Generally, Dominican Republic EOR/PEO services are offered at a monthly cost per employee or as a percentage of the employee's salary. Additional fees might apply for supplementary services or tailored solutions to meet specific business needs. Businesses seeking EOR/PEO services in the Dominican Republic should consider these factors when evaluating the overall cost and benefits of such partnerships.

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Key Metrics For Foreign Employers 

Labor costs in the Dominican Republic can be more competitive than in many Western countries. Considering that the country has a highly skilled workforce, hiring from here can result in significant cost savings.

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The table below depicts key indicators from the Global Talent Competitiveness Report for employers wishing to hire from the Dominican Republic.

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Source: The Global Talent Competitiveness Index 2023

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Through the Gloroots’ Recrew platform, you can discover amazing talent in the Dominican Republic.

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In the Dominican Republic, misclassification of employees can pose significant risks for businesses. Incorrectly categorizing workers as independent contractors or exempt from employment laws may lead to legal and financial consequences, including claims for unpaid wages and benefits.

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Partnering with a PEO/EOR in the Dominican Republic helps mitigate these risks. The PEO/EOR ensures proper employee classification, compliance with labor laws, accurate payroll processing, and access to comprehensive benefits. This enables businesses to focus on core operations while entrusting employment-related responsibilities to experienced professionals, safeguarding them from potential legal liabilities. By doing so, companies can maintain compliance with Dominican Republic's labor regulations and protect their interests in the event of disputes related to employee classification.

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Labor relationships in the Dominican Republic are governed by the Dominican Labor Code (Law 16-92). These laws cover and regulate all aspects pertaining to employment contracts, minimum wages, time-offs, vacations, etc.

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Employment contract

Employee contracts in the Dominican Republic can be either verbal or written, as accepted by the Labor Laws. Employers have the flexibility to choose between Spanish or English as the language for the employment contract. Having this knowledge ensures a smooth and legally compliant hiring process for employers in the Dominican Republic.

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Employment contract must contain the following details: 

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• Identification of both parties
• Commencement date (and employment duration for temporary contracts)
• Workplace
• Job description, duties, and responsibilities
• Basic salary and other compensation or benefits
• Working hours
• Total number of holidays
• Notice periods for employment termination
• Probation period
• Reasons for choosing a fixed-term contract (if applicable)
• Health and safety obligations
• Data protection obligations

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It's important for employers to understand the intricacies of these programs before making a hire. This might sound overwhelming, but it doesn't have to be. A solution like Gloroots eliminates the barriers for you. With Gloroots' Employer of Record offering, hiring and managing employees globally is a piece of cake.

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Get an overview of what you need to know when hiring in the Dominican Republic. Contact us.

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Working hours

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Employment law mandates that employees can work for up to 44 hours per week. Employees in executive or managerial positions are exempted from this rule.

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Overtime

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In the Dominican Republic, overtime work, which exceeds the standard weekly working hours, is governed by the employment contract or collective bargaining agreements. 

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Overtime on regular days

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Overtime on weekends

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If an employee works overtime on weekends or public holidays, employees are entitled to be paid at 200% of their regular pay rate. Overtime hours worked during the night are compensated at a rate of 115%. 

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Businesses must be aware of these overtime regulations to ensure compliance and fair compensation for their employees in the Dominican Republic.

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Minimum Wage

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The minimum wage in the Dominican Republic is determined based on the size and scale of the enterprise:

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Employers should adhere to these specific minimum wage rates corresponding to their enterprise size to comply with the Dominican Republic's labor laws.

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Public holidays

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The Dominican Republic observes 13 public holidays.

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Sick pay

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The paid sick leave entitlement in the Dominican Republic ranges from 21 to 23 days.

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Maternity leave 

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Female employees have the right to avail 14 weeks of paid maternity leave, with approximately seven weeks granted before the expected delivery date and the remaining seven weeks after childbirth. The payment for maternity leave is equally shared between the employer and the social security system.

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Annual leave 

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Employees who work on a full-time basis and have completed a minimum of one year of service are eligible for 14 days of paid annual leave. After five years of continuous employment, this entitlement increases to 18 days of paid annual leave.

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Income tax

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Employee Income Tax

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Tax and social security contribution

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Employer Payroll Contributions

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Employee Payroll Contributions

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Employment Termination and Severance

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Termination Process

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Employers have the authority to end a fixed-term contract under the following circumstances:

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1. Business-related reasons

2. Personal reasons

3. Misconduct

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The termination process necessitates providing written notice to the employee, along with a clear explanation for the decision.

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Severance Pay

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Severance pay is calculated based on an employee's seniority as follows:

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•  3 to 6 months of service: 6 days' salary
•  6 to 12 months of service: 13 days' salary
•  1 to 5 years of service: 21 days' salary
•  Over 5 years of service: 23 days' salary

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Employers are required to make all severance pay payments within ten days of notifying the employee of their termination.

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Notice Periods

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The duration of the notice period is determined by the employee's length of service:

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• Up to 6 months of employment: 7 days' notice
• 6 months to 1 year of employment: 14 days' notice
• Over 1 year of employment: 28 days' notice

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Probation Periods

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The length of the probation period varies based on the nature of the role and is specified in the employment contract. Typically, probation periods last up to three months.

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When hiring globally, ensuring compliance comes with its own set of battles. Employers must ensure all hiring and onboarding activities adhere to employment laws, payroll procedures, DE&I compliance, GDPR and similar data protection, etc. If you think it is hard to set up local entities and start hiring, keeping up with a dynamic compliance landscape is far harder. 

Gloroots helps you minimize all these efforts by providing a single window to manage all these tasks. Our in-house experts fully shield you from cross-border employment and payroll compliance risks. We do this by helping you with generating employment contracts, on-time payments, compliant benefits, while you focus only on screening talent. 

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Our promise is a stress-free global employment experience for both you and your employee.

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Contact our experts today to kickstart your global hiring campaign.

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To expand your team in the Dominican Republic, it is crucial to navigate the intricacies of local employment regulations and efficiently handle compliance, payroll, tax, and benefits management. Establishing a legal presence and utilizing local resources are essential steps in this process.

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With Gloroots' comprehensive global Employer of Record (EoR) service, you can delegate the complexities of payroll, tax, benefits, and compliance to our experienced team. This empowers you to prioritize your core business activities, focusing on your employees and driving business growth. Our EoR service in the Dominican Republic ensures strict adherence to all local laws and regulations, providing a seamless and business-friendly solution to expand your team successfully.

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