Countries › Panama › Guide › 7. Labor and employment › Working hours and overtime in Panama: 48 hour day week, 25 to 75 percent overtime surcharges, Sunday at 50 percent and national holidays at 150 percent

Working hours and overtime in Panama: 48 hour day week, 25 to 75 percent overtime surcharges, Sunday at 50 percent and national holidays at 150 percent

Last verified: 2026-10-29 · Status: Stable

The Código de Trabajo caps the day shift at 8 hours and 48 a week, the night shift at 7 hours and 42 a week and the mixed shift at 7.5 hours and 45 a week. Overtime is voluntary except in emergencies or where agreed, limited to 3 hours a day and 9 a week, and paid at 25, 50 or 75 percent above the hourly wage depending on when it is worked. Work on the weekly rest day carries a 50 percent surcharge and work on a national holiday 150 percent.

Panama's currency, the balboa (B/.), is at par with the US dollar, which circulates as legal tender; the Superintendencia de Bancos states that the balboa's value is on a par with the US dollar (checked 29 October 2026). USD figures therefore equal the balboa figures.

Key facts

Maximum ordinary day shift	8 hoursCódigo de Trabajo art. 31, as of 2026-10-29 · in force
Maximum ordinary working week (day shift)	48 hoursCódigo de Trabajo art. 31, as of 2026-10-29 · in force
Maximum ordinary working week (night shift)	42 hoursCódigo de Trabajo art. 31, as of 2026-10-29 · in force
Overtime surcharge, day period	25 %Código de Trabajo art. 33, as of 2026-10-29 · in force
Overtime surcharge, night period	50 %Código de Trabajo art. 33, as of 2026-10-29 · in force
Overtime surcharge, extension of a night shift	75 %Código de Trabajo art. 33, as of 2026-10-29 · in force
Maximum overtime per day	3 hoursCódigo de Trabajo art. 36, as of 2026-10-29 · in force
Maximum overtime per week	9 hoursCódigo de Trabajo art. 36, as of 2026-10-29 · in force
Surcharge for work on Sunday or the weekly rest day	50 %Código de Trabajo art. 48, as of 2026-10-29 · in force
Surcharge for work on a national holiday	150 %Código de Trabajo art. 49, as of 2026-10-29 · in force
Exchange rate used for USD conversions	1 PAB per USDBalboa at par with the US dollar (Superintendencia de Bancos), as of 2026-10-29 · in force

The rule

1. The day runs from 6 a.m. to 6 p.m. (day period) and 6 p.m. to 6 a.m. (night period). A shift with more than three hours in the night period is a night shift; one with hours in both periods but no more than three at night is a mixed shift.Código de Trabajo (Decreto de Gabinete 252 de 1971), art. 30, 1971-12-30 official text · verified 2026-10-29

2. Maximum ordinary hours: day shift 8 hours a day and 48 a week; night shift 7 hours and 42 a week; mixed shift 7.5 hours and 45 a week. Seven night hours and seven and a half mixed hours are paid as eight day hours for minimum wage purposes.Código de Trabajo (Decreto de Gabinete 252 de 1971), art. 31, 1971-12-30 official text · verified 2026-10-29

3. Working time is all time the worker cannot use freely because they are at the employer's disposal. Time beyond the legal, contractual or internal regulation limits is overtime, paid with a surcharge of 25 percent in the day period, 50 percent in the night period or when extending a mixed shift that began in the day, and 75 percent when extending a night shift or a mixed shift that began at night.
Example: Hourly wage B/.5.00: day overtime B/.6.25 an hour, night overtime B/.7.50, extension of a night shift B/.8.75. / US$5.00 base: US$6.25, US$7.50 and US$8.75 an hour.Código de Trabajo (Decreto de Gabinete 252 de 1971), arts. 33 and 34, 1971-12-30 official text · verified 2026-10-29

4. Workers are not obliged to work overtime except to deal with an accident or imminent risk to lives or to the business, or where a collective agreement provides for it and the worker accepts it in the individual contract. In agricultural operations, small businesses and 100 percent export industries workers must work overtime when the activity requires it, within legal limits.Código de Trabajo art. 35, last paragraph added by Ley 1 de 17 de marzo de 1986 art. 4, art. 35, 1971-12-30 official text · verified 2026-10-29

5. Overtime is banned in dangerous or unhealthy work and for workers under sixteen. No more than 3 overtime hours a day or 9 a week may be worked; any excess is paid with an additional 75 percent surcharge, without prejudice to penalties on the employer.Código de Trabajo (Decreto de Gabinete 252 de 1971), art. 36, 1971-12-30 official text · verified 2026-10-29

6. Overtime worked up to five working days before pay day must be included in that pay period. Breaches of the working time chapter are fined B/.50 to B/.500.Código de Trabajo (Decreto de Gabinete 252 de 1971), arts. 37 and 38, 1971-12-30 official text · verified 2026-10-29

7. The working day must include a rest break of at least half an hour and no more than two hours; in night or mixed shifts the parties may agree how to distribute it. When rotating shifts make a worker cover consecutive day and night shifts, the employer must give at least twelve continuous hours of rest.Código de Trabajo art. 39 numeral 1 as amended by Ley 44 de 1995 art. 4, art. 39, 1995-08-12 official text · verified 2026-10-29

8. The weekly rest day should preferably be Sunday. Work on Sunday or the weekly rest day is paid with a 50 percent surcharge on the ordinary day plus a compensatory day off; work on that compensatory day also carries 50 percent.Código de Trabajo (Decreto de Gabinete 252 de 1971), arts. 41 and 48, 1971-12-30 official text · verified 2026-10-29

9. Work on a national holiday or day of mourning is paid with a 150 percent surcharge on the ordinary day's wage (which includes the pay for the rest day), plus a compensatory day off. Work on days off arising from weeks shorter than six days carries 50 percent in the day shift and 75 percent in mixed or night shifts. Where several surcharges apply they are compounded: the Sunday or holiday surcharge first, then the overtime surcharge on the result.Código de Trabajo (Decreto de Gabinete 252 de 1971), arts. 49 and 50, 1971-12-30 official text · verified 2026-10-29

10. Businesses must close on Sundays and national holidays except, among others, public services, farms, pharmacies, hotels, restaurants, entertainment venues, food retailers and operations authorized by the Dirección General de Trabajo because closing would seriously harm the public interest or the economy.Código de Trabajo (Decreto de Gabinete 252 de 1971), art. 42, 1971-12-30 official text · verified 2026-10-29

11. When 28 November falls on a Tuesday or Wednesday the rest day moves to the previous Monday, and when it falls on a Thursday or Friday it moves to the following Monday; 9 January is commemorated without moving the rest day.Código de Trabajo art. 46 as amended by Ley 118 de 27 de diciembre de 2013 art. 6, art. 46, 2013-12-27 official text · verified 2026-10-29

Situation	Surcharge	Pay per hour
Ordinary hour	0 percent	B/.5.00
Overtime in the day period	25 percent	B/.6.25
Overtime at night or extending a mixed shift begun in the day	50 percent	B/.7.50
Overtime extending a night shift or a mixed shift begun at night	75 percent	B/.8.75
Ordinary hour on Sunday or weekly rest day	50 percent	B/.7.50
Ordinary hour on a national holiday	150 percent	B/.12.50

Pay for an hour of work at a B/.5.00 (US$5.00) base rate, Código de Trabajo arts. 33, 36, 48 and 49.

Worked example

A warehouse worker earns B/.4.00 (US$4.00) an hour on a day shift and works 2 overtime hours on a Sunday that is their rest day.
The Sunday surcharge applies first: B/.4.00 plus 50 percent is B/.6.00 an hour. The day overtime surcharge of 25 percent is then applied on that result, giving B/.7.50 an hour (art. 50).
The two overtime hours cost B/.15.00 (US$15.00), and the worker is still owed a compensatory day off for working the rest day.

Step by step

Set each role's shift type (day, night or mixed) and record hours daily.
Get the worker's agreement for overtime in the individual contract where a collective agreement allows it; otherwise overtime is voluntary except in emergencies.
Cap overtime at 3 hours a day and 9 a week, and pay any excess at the extra 75 percent surcharge.
Show ordinary pay, overtime and premiums separately on the payroll, as required by art. 152.
Check whether the business may open on Sundays and holidays under art. 42 before scheduling staff.

Common traps

Surcharges compound under art. 50, so Sunday or holiday overtime costs much more than the headline 25 percent.
Time on call at the employer's disposal counts as working time (art. 33).
Breaching the 9 hour weekly overtime cap does not just mean a fine: the excess hours carry an extra 75 percent surcharge.
Executive decrees can declare extra days of national mourning or bridge holidays; check the Gaceta Oficial each year.

Sources

← Minimum wage in Panama 2026 and 2027: hourly rates by region, activity and company size under Decreto Ejecutivo 13 de 2025Pay rules and the thirteenth month salary in Panama: what counts as salary, fortnightly payment, deductions and the décimo tercer mes →

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