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Employer compliance for foreign staff in Chile: who you may hire, contract formalities, the 85 percent rule and fines for unauthorised work

Last verified: 2026-10-26 · Status: Stable

A Chilean employer may only hire foreigners who hold a residence or stay permit that allows work, or a specific work authorisation, and each unauthorised hire is fined by company size, from 1 to 20 UTM for micro companies up to 60 to 200 UTM for large ones, with the maximum for repeat offences within 2 years. Contracts used for a work permit must be signed by the employer before a Chilean notary and by the worker at a Chilean consulate, match the activities the employer declared to the SII, and still be put in writing and registered with the Labour Directorate within 15 days. Once headcount passes 25, at least 85 percent of staff must be Chilean, counting long term residents and specialist technical staff in the employer's favour, and qualifying foreign technicians can opt out of Chilean pension contributions under Ley Nº 18.156.

USD figures use the Central Bank rate of CLP 986.58 per US dollar published in the Diario Oficial of 23 October 2026 (CVE 2891564). UTM amounts use the SII value of CLP 72,151 for October 2026 (CLP 72,440 from November 2026) and UTA amounts CLP 865,812. Conversions are for orientation only.

Key facts

Maximum fine per unauthorised foreign worker, micro company	20 UTMLey Nº 21.325 art. 117, as of 2026-10-26 · in force
Maximum fine per unauthorised foreign worker, small company	40 UTMLey Nº 21.325 art. 117, as of 2026-10-26 · in force
Maximum fine per unauthorised foreign worker, medium company	100 UTMLey Nº 21.325 art. 117, as of 2026-10-26 · in force
Minimum fine per unauthorised foreign worker, large company	60 UTMLey Nº 21.325 art. 117, as of 2026-10-26 · in force
Maximum fine per unauthorised foreign worker, large company	200 UTMLey Nº 21.325 art. 117, as of 2026-10-26 · in force
Window in which a repeat offence draws the maximum fine	2 yearsLey Nº 21.325 art. 117, as of 2026-10-26 · in force
Minimum length of the employment contract for the work permit	3 monthsDecreto Nº 177 of 2022 art. 17, as of 2026-10-26 · in force
Days after entry to file the registered contract under a job offer permit	45 daysDecreto Nº 177 of 2022 art. 18, as of 2026-10-26 · in force
Days to put an employment contract in writing	15 daysCódigo del Trabajo art. 9, as of 2026-10-26 · in force
Days to register an employment contract with the Labour Directorate	15 daysCódigo del Trabajo art. 9 bis, as of 2026-10-26 · in force
Minimum share of Chilean workers per employer	85 %Código del Trabajo art. 19, as of 2026-10-26 · in force
Headcount up to which the 85 percent rule does not apply	25 workersCódigo del Trabajo art. 19, as of 2026-10-26 · in force
Years of residence after which a foreigner counts as Chilean for the 85 percent rule	5 yearsCódigo del Trabajo art. 20 Nº 4, as of 2026-10-26 · in force
Maximum fine for claiming the foreign technician pension exemption without qualifying	5 UTALey Nº 18.156 art. 3, as of 2026-10-26 · in force

The rule

1. Employers may only employ foreigners who hold a residence or stay permit that allows them to work, or who are duly authorised to work. The duty applies to individuals and companies alike, and it applies from the first day of work, not from the date of registration of the contract.Ley Nº 21.325, Ley de Migración y Extranjería, Art. 103, 2021-04-20 official text · verified 2026-10-26

2. Hiring a foreigner without such a permit or authorisation is a serious migration infraction fined per foreign worker, with the employer classified under art. 505 bis of the Labour Code by headcount: micro (1 to 9 workers) 1 to 20 UTM, small (10 to 49) 10 to 40 UTM, medium (50 to 199) 30 to 100 UTM and large (200 or more) 60 to 200 UTM. A repeat offence within 2 years of the earlier sanction is fined at the maximum. The fines do not relieve the employer of any labour or social security obligation toward the worker. A worker who files a complaint against the employer before SERMIG, the Labour Directorate, the courts or another public body is not fined for having worked without authorisation.
Cost to do it: Per unauthorised foreign worker at the October 2026 UTM of CLP 72,151: micro CLP 72,151 to CLP 1,443,020 (about US$73 to US$1,463); small CLP 721,510 to CLP 2,886,040 (US$731 to US$2,925); medium CLP 2,164,530 to CLP 7,215,100 (US$2,194 to US$7,313); large CLP 4,329,060 to CLP 14,430,200 (US$4,388 to US$14,626).
Example: A large company found with three foreign staff working on visitor stays faces up to CLP 43,290,600, and the full maximum if it was sanctioned for the same conduct in the previous 2 years. / Up to about US$43,879 for three workers.Ley Nº 21.325; DFL Nº 1 of 2002, Código del Trabajo, Ley Nº 21.325 art. 117 and art. 123; Código del Trabajo art. 505 bis, 2021-04-20 official text · verified 2026-10-26

3. For the employee route, the employer must be a person or company with a domicile or branch in Chile and, where its activity requires it, a current start of activities with the SII. The employment contract must last at least 3 months, be signed by the employer before a Chilean notary and by the worker before the competent Chilean consulate, and its purpose must be consistent with the activities the employer has declared to the SII. The application must include the employer's SII tax folder (carpeta tributaria); an employer without start of activities must prove enough solvency to meet the contract.
Cost to do it: No SERMIG fee for the employer; the worker pays the temporary residence fee set by nationality (see immigration/work-permits). Notary fees for the employer's signature are extra and not fixed by SERMIG.Decreto Nº 177 of 2022, Ministerio del Interior y Seguridad Pública, Art. 17 and art. 22, 2022-05-14 official text · verified 2026-10-26

4. An employer may instead issue a formal job offer, recorded (protocolizado) before a Chilean notary and accepted in writing by the foreigner at a consulate. SERMIG then grants a 90 day permit, and within 45 calendar days of entry the worker must file a notarised copy of the employment contract with the same employer and proof of its electronic registration with the Labour Directorate. If that is not done, SERMIG cancels the permit and orders the worker to leave, without prejudice to any civil or criminal liability of the person who issued an offer that did not go ahead.Decreto Nº 177 of 2022, Art. 18, 2022-05-14 official text · verified 2026-10-26

5. Ending the contract that supported the permit does not by itself revoke it, and a holder of the paid activities residence permit can change employer without notifying SERMIG. The contract must contain the minimum terms of art. 10 of the Labour Code. The parties may agree, voluntarily, that the employer pays the worker's return ticket when the contract ends; there is no mandatory repatriation clause.Decreto Nº 177 of 2022, Art. 19, 2022-05-14 official text · verified 2026-10-26

6. Every employment contract, including a foreigner's, must be in writing and signed in two copies within 15 days of the worker starting (5 days for contracts for a specific task or shorter than 30 days), on pain of a fine of 1 to 5 UTM. The employer must also register the contract on the Labour Directorate's website within 15 days of signing it and register each termination. Decreto Nº 177 repeats that these duties apply to contracts used for a work permit, with the permit running from the worker's entry.
Cost to do it: Late written contract: 1 to 5 UTM, CLP 72,151 to CLP 360,755 (about US$73 to US$366).DFL Nº 1 of 2002, Código del Trabajo, as amended by Ley Nº 21.327 (Diario Oficial 30 April 2021), Art. 9 and art. 9 bis; Decreto Nº 177 art. 17, 2021-04-30 official text · verified 2026-10-26

7. At least 85 percent of the workers serving the same employer must be Chilean, unless the employer has no more than 25 workers. The share is counted on all workers in Chile, not by branch; specialist technical staff are left out of the count; a foreigner whose spouse, civil partner or children are Chilean, or who is the widow or widower of a Chilean, counts as Chilean; and so does a foreigner resident in Chile for more than 5 years, ignoring occasional absences. The Labour Code sets no special fine for this rule, so the general scale of art. 506 applies: 1 to 5 UTM for micro, 1 to 10 for small, 2 to 40 for medium and 3 to 60 for large companies.
Cost to do it: General fine for a large company: 3 to 60 UTM, CLP 216,453 to CLP 4,329,060 (about US$219 to US$4,388).DFL Nº 1 of 2002, Código del Trabajo, Art. 19, art. 20 and art. 506, 2003-01-16 official text · verified 2026-10-26

8. Companies that hire foreign technical staff, and that staff, are exempt from Chilean pension contributions under those contracts if the worker is affiliated with a social security system abroad covering at least sickness, disability, old age and death, and the contract records the worker's wish to keep that affiliation. Work accident insurance under Ley Nº 16.744 still applies. Claiming the exemption without meeting the conditions is fined up to 5 UTA, doubled for more than one infraction within 2 years, applied by the Labour Directorate. These employers may also pay such staff in foreign currency.
Cost to do it: Misuse fine of up to 5 UTA, CLP 4,329,060 (about US$4,388), or up to 10 UTA for repeat infractions.Ley Nº 18.156, as amended by Ley Nº 18.726 (Diario Oficial 23 July 1988), Art. 1, art. 3, art. 4 and art. 5, 1982-08-25 official text · verified 2026-10-26

9. Companies that facilitate or promote the illegal entry or exit of a foreigner are fined 50 to 100 UTM, a serious infraction separate from the fine for unauthorised employment. Employers that house workers must also respect occupancy standards for rooms rented or sublet to foreigners: the fine under Ley Nº 18.101 art. 24 quáter cannot be lower than 30 percent of its maximum.
Cost to do it: 50 to 100 UTM, CLP 3,607,550 to CLP 7,215,100 (about US$3,657 to US$7,313).Ley Nº 21.325, Art. 112 and art. 118, 2021-04-20 official text · verified 2026-10-26

Employer size	Workers	Fine (UTM)	CLP	Approx. US$
Micro	1 to 9	1 to 20	72,151 to 1,443,020	73 to 1,463
Small	10 to 49	10 to 40	721,510 to 2,886,040	731 to 2,925
Medium	50 to 199	30 to 100	2,164,530 to 7,215,100	2,194 to 7,313
Large	200 or more	60 to 200	4,329,060 to 14,430,200	4,388 to 14,626

Fine per unauthorised foreign worker by employer size (Ley Nº 21.325 art. 117; sizes under Código del Trabajo art. 505 bis), at the October 2026 UTM of CLP 72,151 and CLP 986.58 per US dollar

Item	Headcount
Total workers in Chile, all branches	60
Less specialist technical staff (excluded from the count)	4
Workers counted	56
Foreigners counted as Chilean (Chilean spouse or children, or more than 5 years' residence)	3
Other foreigners	7
Chilean share: (56 minus 7) divided by 56	87.5 percent, compliant
Maximum other foreigners at 56 counted workers (15 percent of 56, rounded down)	8

85 percent rule worked example (Código del Trabajo art. 19 and 20)

Worked example

A Santiago SpA with 120 workers (a medium company) hires a Colombian analyst who is still on a visitor stay. If the Labour Directorate or SERMIG detects it, the company faces 30 to 100 UTM, CLP 2,164,530 to CLP 7,215,100 (about US$2,194 to US$7,313), and the analyst 0.5 to 5 UTM (CLP 36,076 to CLP 360,755), unless the analyst has filed a complaint against the employer.
The same company instead signs a 12 month contract before a Santiago notary, the analyst signs at the Chilean consulate in Bogotá, and the analyst applies for the paid activities permit from abroad. The company writes and registers the contract within 15 days of the start date, as for any employee.
A mining contractor hires a German engineer seconded for 2 years who stays in the German pension system. The contract states that the engineer wishes to keep that affiliation, so neither side pays Chilean pension contributions under Ley Nº 18.156; work accident insurance is still paid in Chile.
An employer issues a notarised job offer to a Peruvian chef. The chef enters on the 90 day permit, but the restaurant delays signing the contract. On day 46 the permit is cancelled and an order to leave follows, and the restaurant may face civil liability for the failed offer.

Step by step

Before the first day of work, check the candidate's permit: a residence card or SERMIG resolution in a subcategory that allows work, a residence in process certificate for an application that allows work, or a visitor work authorisation covering the specific activity.
For a hire from abroad, prepare a contract of at least 3 months that matches the activities registered with the SII; sign it before a Chilean notary and send it for the worker's signature at the Chilean consulate. Have the SII carpeta tributaria ready for the application.
If speed matters, use the notarised job offer route and diarise the 45 day deadline after entry to sign, notarise and register the contract.
Put the contract in writing within 15 days of the start date and register it on the Labour Directorate site within 15 days of signing; register the termination when the job ends.
Track the 85 percent rule once headcount exceeds 25, keeping records of specialist technical staff and of foreigners who count as Chilean.
For seconded technicians who keep a foreign pension, include the Ley Nº 18.156 clause in the contract and keep proof of foreign affiliation.
Diarise each foreign employee's permit expiry: renewals are filed 90 to 10 days before expiry (Reglamento art. 70), and the worker, not the employer, files them.

Common traps

Letting someone start before the permit is granted. A visitor cannot work without a specific authorisation, and the employer is fined per worker even if the paperwork is already in progress abroad.
Relying on a job offer but not converting it. The 90 day permit falls away if the registered contract is not filed within 45 days of entry (Decreto Nº 177 art. 18).
Contract purpose that does not match the SII activity codes. SERMIG checks consistency with the employer's declared activities, so update the SII registration first.
Assuming the worker's complaint protects the company. A worker who reports the employer escapes the worker fine (Ley Nº 21.325 art. 117), but the employer's fine still applies.
Repeat offences within 2 years are fined at the maximum, so a second case in a large company costs 200 UTM per worker.
Using the foreign technician exemption for staff who are not technical or who lack foreign coverage for sickness, disability, old age and death. The Labour Directorate can fine up to 5 UTA per case and the unpaid contributions remain due.
Treating the 85 percent count as per branch. It is counted across the whole workforce in Chile (Código del Trabajo art. 20 Nº 1).

Sources

← Chilean nationality by naturalisation: the 5 year route, the 2 year route for spouses and relatives of Chileans, fees, processing time and voting rights for residentsRelocating staff to Chile: tax residence, the 3 year foreign income relief, wage tax, the foreign technician pension exemption and social security agreements →