Countries › Paraguay › Guide › 16. What is normal abroad but not here › No dismissal at will: notice and indemnity
No dismissal at will: notice and indemnity
Last verified: 2026-10-28 · Status: Stable
Abroad, many employers can end an indefinite contract at will or with a short notice. In Paraguay, ending an indefinite contract takes 30 to 90 days of notice (or pay in lieu) and, without just cause, 15 daily wages per year of service. A fraction over six months counts as a full year, and the base is the average pay of the last six months.
USD figures use PYG 5,868.31 per US dollar, the Banco Central del Paraguay reference quotation for 28 October 2026 (planilla de cotizaciones). Conversions are for orientation only.
Key facts
| Dismissal indemnity per year of service or fraction over six months | 15 daily wagesCódigo del Trabajo art. 91 (Ley 496/1995), as of 1995-08-22 · in force |
|---|---|
| Minimum dismissal notice (up to one year of service) | 30 daysCódigo del Trabajo art. 87, as of 1993-06-29 · in force |
| Maximum dismissal notice (more than ten years of service) | 90 daysCódigo del Trabajo art. 87, as of 1993-06-29 · in force |
| Months of average pay used as indemnity base | 6 monthsCódigo del Trabajo art. 92 b, as of 1993-06-29 · in force |
| Daily wage of a monthly paid minimum wage worker from 1 July 2026 | 101467 PYGRes. MTESS 670/2026, as of 2026-07-01 · in force |
| Minimum wage, monthly, from 1 July 2026 | 3044000 PYGDecreto 6225/2026; Res. MTESS 670/2026, as of 2026-07-01 · in force |
| BCP reference rate, PYG per US dollar, 28 October 2026 | 5868.31 PYGBCP planilla de cotizaciones, as of 2026-10-28 · in force |
The rule
1. Notice scales with seniority. Neither party may end an indefinite contract without prior notice, except for the just causes listed in the Code: 30 days after the probation period and up to one year of service, 45 days from one to five years, 60 days from five to ten years and 90 days beyond ten years. The notice must be provable in writing or in authentic form and may be served through the labor authority. During notice the worker keeps full pay and gets two hours a day or one day a week off to look for work.
Cost to do it: No fee; the cost is the notice period itself, worked or paid.
Example: A worker paid PYG 10,000,000 a month with three years of service is owed 45 days of notice, worth PYG 15,000,000. / About US$2,556.Ley Nº 213/1993, Código del Trabajo (promulgated 29 June 1993), art. 87, 88 and 89 (not amended by Ley 496/1995), 1993-06-29 official text · verified 2026-10-28
Cost to do it: No fee; the cost is the notice period itself, worked or paid.
Example: A worker paid PYG 10,000,000 a month with three years of service is owed 45 days of notice, worth PYG 15,000,000. / About US$2,556.Ley Nº 213/1993, Código del Trabajo (promulgated 29 June 1993), art. 87, 88 and 89 (not amended by Ley 496/1995), 1993-06-29 official text · verified 2026-10-28
2. Skipping notice means paying it. An employer that gives no notice, or gives it without the legal requirements, pays the salary for the whole notice period. A worker who resigns without notice owes the employer half the salary for the notice period.
Cost to do it: Pay in lieu equal to 30, 45, 60 or 90 days of salary.
Example: Omitting 60 days of notice for a worker paid PYG 10,000,000 a month costs PYG 20,000,000. / About US$3,408.Ley Nº 213/1993, Código del Trabajo, art. 90 (not amended by Ley 496/1995), 1993-06-29 official text · verified 2026-10-28
Cost to do it: Pay in lieu equal to 30, 45, 60 or 90 days of salary.
Example: Omitting 60 days of notice for a worker paid PYG 10,000,000 a month costs PYG 20,000,000. / About US$3,408.Ley Nº 213/1993, Código del Trabajo, art. 90 (not amended by Ley 496/1995), 1993-06-29 official text · verified 2026-10-28
3. Dismissal without just cause costs an indemnity. With or without notice, an employer that dismisses without just cause pays 15 daily wages for each year of service or fraction over six months. The base is the average of wages earned in the last six months (or the shorter period worked), and continuity is not broken by sickness, leave, vacation or lawful strikes.
Cost to do it: 15 daily wages per year. At the minimum wage (daily wage for a monthly paid worker PYG 101,467, Res. MTESS 670/2026) each year costs PYG 1,522,005 (US$259).
Example: A worker paid PYG 10,000,000 a month dismissed without cause after 4 years and 8 months counts as 5 years: indemnity PYG 25,000,000 plus PYG 15,000,000 for 45 days of omitted notice, PYG 40,000,000 in total. / About US$4,260 of indemnity plus US$2,556 in lieu of notice, about US$6,816 in total.Ley Nº 213/1993, Código del Trabajo; art. 91 as reworded by Ley Nº 496/1995 (promulgated 22 August 1995), art. 91 (text given by Ley 496/1995); art. 92 b and c (original text), 1995-08-22 official text · verified 2026-10-28
Cost to do it: 15 daily wages per year. At the minimum wage (daily wage for a monthly paid worker PYG 101,467, Res. MTESS 670/2026) each year costs PYG 1,522,005 (US$259).
Example: A worker paid PYG 10,000,000 a month dismissed without cause after 4 years and 8 months counts as 5 years: indemnity PYG 25,000,000 plus PYG 15,000,000 for 45 days of omitted notice, PYG 40,000,000 in total. / About US$4,260 of indemnity plus US$2,556 in lieu of notice, about US$6,816 in total.Ley Nº 213/1993, Código del Trabajo; art. 91 as reworded by Ley Nº 496/1995 (promulgated 22 August 1995), art. 91 (text given by Ley 496/1995); art. 92 b and c (original text), 1995-08-22 official text · verified 2026-10-28
4. Just cause is a closed list. The Code lists the causes that let an employer end the contract unilaterally without indemnity, such as deceit through false certificates, theft at work, violence or insults, intentional or grossly negligent damage, immoral acts at work and disclosure of secrets; the worker has a matching list of causes to resign and claim as if dismissed, such as unpaid or illegally reduced salary.
Cost to do it: No fee; a cause that cannot be proven turns the termination into a dismissal without cause, with notice and indemnity.
Example: An employer that dismisses for alleged theft but cannot prove it owes notice and the full indemnity. / Not applicable.Ley Nº 213/1993, Código del Trabajo, art. 81 and 84, 1993-06-29 official text · verified 2026-10-28
Cost to do it: No fee; a cause that cannot be proven turns the termination into a dismissal without cause, with notice and indemnity.
Example: An employer that dismisses for alleged theft but cannot prove it owes notice and the full indemnity. / Not applicable.Ley Nº 213/1993, Código del Trabajo, art. 81 and 84, 1993-06-29 official text · verified 2026-10-28
| Service | Notice | Pay in lieu on PYG 10,000,000 a month |
|---|---|---|
| Up to 1 year | 30 days | PYG 10,000,000 |
| More than 1 to 5 years | 45 days | PYG 15,000,000 |
| More than 5 to 10 years | 60 days | PYG 20,000,000 |
| More than 10 years | 90 days | PYG 30,000,000 |
Notice by seniority (Código del Trabajo art. 87)
Worked example
- A foreign owned distributor dismisses a sales manager paid PYG 10,000,000 (US$1,704) a month after 4 years and 8 months for restructuring, without notice. It owes 45 days of pay in lieu (PYG 15,000,000), an indemnity for 5 years (PYG 25,000,000), plus the proportional aguinaldo and any unused vacation: about US$6,816 before those two items.
Step by step
- Write the notice and keep proof of delivery, or serve it through the labor authority.
- Compute seniority including the notice period actually worked (art. 87, last paragraph).
- Compute the average of the last six months of pay, including variable pay.
- Add the proportional aguinaldo and unused vacation to the final settlement.
- Give the worker the free termination certificate required by art. 93.
Common traps
- Rounding service down: a fraction over six months counts as a full year (art. 91 as reworded by Ley 496/1995).
- Using the base salary only: the indemnity base is the average of all wages earned in the last six months (art. 92 b).
- Citing the 1993 text: Ley 496/1995 rewrote art. 91 and about 70 other articles, so check the amendment list first.
- Assuming a probation period covers everything: notice under art. 87 runs from the end of the probation period.
Sources
- Ley 213/1993, Código del Trabajo (BACN)
- Ley 496/1995 amending the Código del Trabajo (BACN)
- Resolución MTESS 670/2026 on the minimum wage (MTESS)
- BCP exchange rate quotations
Related pages
- labor/dismissal-and-severance
- labor/employment-contracts
- normal-abroad/job-stability-after-ten-years
- normal-abroad/what-works-differently-in-paraguay
- /calendar/
- /country/paraguay/
- Live dashboard
Related: Paraguay country profile · live dashboard · central bank and release calendar · our posts on X
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