Countries › Peru › Guide › 7. Labor and employment › Employing people in Peru: contracts, the S/ 1,230 minimum wage, hours, statutory bonuses, CTS, EsSalud, profit sharing, dismissal and foreign staff limits

Employing people in Peru: contracts, the S/ 1,230 minimum wage, hours, statutory bonuses, CTS, EsSalud, profit sharing, dismissal and foreign staff limits

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Last verified: 2026-10-28 · Status: Changing

Peruvian employment is presumed indefinite; fixed term contracts must be written, justified and capped at five years, and the trial period is three months. The minimum wage is S/ 1,230 a month from 1 October 2026, with a second step to S/ 1,300 announced for 2027; the week is capped at 48 hours and overtime pays at least 25 or 35 percent extra. On top of 12 salaries, employers pay two bonuses, about one more salary into the CTS fund, 9 percent EsSalud and, above 20 workers, 5 to 10 percent of pre tax profit, so a salaried worker costs about 1.37 times annual pay; dismissal without proven cause costs 1.5 salaries per year, capped at 12.

USD figures use S/ 3.446 per US dollar, the banking system selling rate published by the Superintendencia de Banca, Seguros y AFP for 26 October 2026, from the Banco Central de Reserva del Perú statistics series PD04640PD. Conversions are for orientation only.

Key facts

Minimum monthly wage (Remuneración Mínima Vital) from 1 October 2026	1230 PENDS 015-2026-TR art. 1.2, as of 2026-10-28 · in force
Minimum monthly wage in US dollars at S/ 3.446	356.94 USDDS 015-2026-TR art. 1.2, as of 2026-10-28 · in force
Minimum monthly wage after the announced second step (first half of 2027, needs a supreme decree)	1300 PENDS 015-2026-TR art. 1.1 and 1.2, as of 2026-10-28 · pending
Maximum ordinary working day	8 hoursTUO DL 854 (DS 007-2002-TR) art. 1, as of 2026-10-28 · in force
Maximum ordinary working week	48 hoursTUO DL 854 (DS 007-2002-TR) art. 1, as of 2026-10-28 · in force
Minimum overtime premium, first two hours	25 %TUO DL 854 (DS 007-2002-TR) art. 10, as of 2026-10-28 · in force
Minimum overtime premium after the first two hours	35 %TUO DL 854 (DS 007-2002-TR) art. 10, as of 2026-10-28 · in force
General trial period	90 daysTUO DL 728 (DS 003-97-TR) art. 10 (three months), as of 2026-10-28 · in force
Maximum combined duration of successive fixed term contracts	5 yearsTUO DL 728 (DS 003-97-TR) art. 74, as of 2026-10-28 · in force
Contract type presumed by law	Indefinite typeTUO DL 728 (DS 003-97-TR) art. 4, as of 2026-10-28 · in force
Indemnity for arbitrary dismissal per year of service	1.5 monthly salariesTUO DL 728 (DS 003-97-TR) art. 38, as of 2026-10-28 · in force
Maximum indemnity for arbitrary dismissal	12 monthly salariesTUO DL 728 (DS 003-97-TR) art. 38, as of 2026-10-28 · in force
Statutory bonuses (two gratificaciones of one salary each)	60 days of salaryLey 27735 art. 1 and 2, as of 2026-10-28 · in force
Extraordinary bonus paid to the worker on each gratificación (EsSalud amount)	9 %Ley 30334 art. 3, as of 2026-10-28 · in force
Severance fund (CTS) deposits, by 15 May and 15 November	2 depositsTUO DL 650 (DS 001-97-TR) art. 21 and 22, as of 2026-10-28 · in force
Paid annual vacation	30 calendar daysDL 713 art. 10, as of 2026-10-28 · in force
Employer EsSalud health contribution	9 %Ley 26790 art. 6 a), as of 2026-10-28 · in force
Employer pension contribution	0 %Pension contribution is withheld from the worker (gob.pe ONP page), as of 2026-10-28 · in force
Worker contribution to the public pension system (ONP)	13 %Sistema Nacional de Pensiones, gob.pe ONP page, as of 2026-10-28 · in force
Highest statutory profit share (fishing, telecom, industry)	10 % of pre tax incomeDL 892 art. 2, as of 2026-10-28 · in force
Profit share for other activities	5 % of pre tax incomeDL 892 art. 2, as of 2026-10-28 · in force
Cap on each worker's profit share	18 monthly salariesDL 892 art. 2, as of 2026-10-28 · in force
Profit sharing applies above this average headcount	20 workersDS 009-98-TR art. 2, as of 2026-10-28 · in force
Family allowance for workers with children under 18	10 % of minimum wageLey 25129 art. 1 and 2, as of 2026-10-28 · in force
Foreign workers as share of headcount	20 %DL 689 art. 4, as of 2026-10-28 · in force
Foreign workers' pay as share of payroll	30 %DL 689 art. 4, as of 2026-10-28 · in force

The rule

1. The minimum monthly pay (Remuneración Mínima Vital) for private sector workers is S/ 1,230 from 1 October 2026, up from S/ 1,130. Decreto Supremo Nº 015-2026-TR raises it by S/ 170 in two steps, following consensus in the Consejo Nacional de Trabajo y Promoción del Empleo on 3 September 2026: S/ 100 now and a further S/ 70, to S/ 1,300, to be set by another supreme decree during the first half of 2027. The minimum also drives other amounts: the family allowance is 10 percent of it.
Cost to do it: A full time worker cannot be paid less than S/ 1,230 a month (about US$356.94); the employer adds 9 percent EsSalud health contribution, S/ 110.70 (about US$32.12).
Example: A worker at the minimum costs S/ 1,230.00 plus S/ 110.70 EsSalud each month, before the two statutory bonuses, CTS and vacation. / About US$356.94 of pay plus US$32.12 of EsSalud a month.Decreto Supremo Nº 015-2026-TR, Art. 1.1 and 1.2, 2026-09-28 official text · verified 2026-10-28 · changed: From 1 October 2026 the minimum wage rose from S/ 1,130 to S/ 1,230; a second step to S/ 1,300 is announced for the first half of 2027 but needs its own supreme decree.

2. Any personal, paid and subordinate service is presumed to be an employment contract of indefinite duration. An indefinite contract can be verbal or written, and part time contracts must be in writing. Fixed term contracts (contratos sujetos a modalidad) are allowed only in the cases the law lists, must be written, in triplicate, and state their term and the objective cause for hiring; successive fixed term contracts with the same worker cannot exceed five years in total. A fixed term contract becomes indefinite if the worker keeps working after the term or permitted renewals, or if simulation or fraud is shown. The trial period is three months, after which the worker is protected against arbitrary dismissal.
Cost to do it: No registration fee in the law text cited; the cost is drafting a written contract for fixed term or part time hires and keeping it on file. Legal drafting fees are a market cost.
Example: A company hires an analyst on a six month project contract that states the objective cause, then renews it three times. If the analyst keeps working after the last renewal ends without a new written contract, the relationship is treated as indefinite. / Not a money rule; see the dismissal rule for what an indefinite worker costs to let go.Texto Único Ordenado del Decreto Legislativo Nº 728, Ley de Productividad y Competitividad Laboral (Decreto Supremo Nº 003-97-TR), Art. 4, 10, 72, 74 and 77, 1997-03-27 official text · verified 2026-10-28

3. Dismissal for proven causes related to the worker's conduct or capacity carries no indemnity. If the dismissal is arbitrary, because no cause was given or it cannot be proved in court, the worker is owed an indemnity of one and a half ordinary monthly salaries for each full year of service, up to a maximum of twelve monthly salaries; fractions of a year are paid by twelfths and thirtieths. The indemnity is due only after the trial period. It is the sole compensation for the dismissal, though the worker can also claim any unpaid benefits; if the dismissal is declared null (for example for discriminatory reasons listed in the law), the court orders reinstatement unless the worker opts for the indemnity.
Cost to do it: 1.5 monthly salaries per year of service, capped at 12 salaries; for a worker on S/ 5,000 the cap is S/ 60,000.00 (about US$17,411.49), reached after eight years.
Example: A manager on S/ 5,000 a month dismissed without cause after 3 years and 4 months receives 1.5 x S/ 5,000 x 3.33 = S/ 25,000.00, plus pending CTS, bonuses and vacation. / About US$7,254.79 of indemnity on a salary of about US$1,450.96 a month.Texto Único Ordenado del Decreto Legislativo Nº 728 (Decreto Supremo Nº 003-97-TR), Art. 34 and 38, 1997-03-27 official text · verified 2026-10-28

4. The ordinary working day is at most 8 hours a day or 48 hours a week for adults. Time worked beyond the daily or weekly limit is overtime, paid with a premium of at least 25 percent of the hourly value for the first two hours and 35 percent for the remaining hours; employer and worker can agree to compensate overtime with equivalent rest. Failing to pay overtime is a labor infraction.
Cost to do it: Overtime premium of 25 percent for the first two daily hours and 35 percent after; on S/ 5,000 a month the hourly value is S/ 20.83.
Example: On S/ 5,000 a month (hourly value S/ 5,000 / 30 / 8 = S/ 20.83), the first two overtime hours pay S/ 26.04 each and later hours S/ 28.12 each. / About US$7.56 and US$8.16 an hour on a salary of about US$1,450.96.Texto Único Ordenado del Decreto Legislativo Nº 854, Ley de Jornada de Trabajo, Horario y Trabajo en Sobretiempo (Decreto Supremo Nº 007-2002-TR), Art. 1 and 10, 2002-07-04 official text · verified 2026-10-28

5. Private sector workers receive two statutory bonuses (gratificaciones) a year, each equal to one monthly salary, paid in the first half of July (Fiestas Patrias) and December (Christmas), whatever the contract type. The bonuses bear no social contributions; instead, the 9 percent EsSalud contribution the employer would have paid on them is paid to the worker as an extraordinary non remunerative bonus.
Cost to do it: Two extra monthly salaries a year plus 9 percent of them; on S/ 5,000 a month, S/ 10,000.00 plus S/ 900.00 (about US$3,163.09).
Example: July and December each bring S/ 5,000 of bonus plus S/ 450 extraordinary bonus, S/ 10,900.00 a year. / About US$3,163.09 a year on a salary of about US$1,450.96 a month.Ley Nº 27735 and Ley Nº 30334, Ley 27735 art. 1, 2 and 5; Ley 30334 art. 1 and 3, 2015-06-24 official text · verified 2026-10-28

6. Each May and November the employer deposits the severance savings fund (Compensación por Tiempo de Servicios, CTS) into a financial institution chosen by the worker, within the first 15 calendar days of the month. Each deposit equals as many twelfths of the computable pay of April or October as full months worked in the semester. Computable pay includes one sixth of the bonuses received in the semester, so a full year of CTS is about one monthly salary plus one sixth of a salary.
Cost to do it: About 1.17 monthly salaries a year; on S/ 5,000 a month, S/ 5,833.33 a year (about US$1,692.78).
Example: For a worker on S/ 5,000 all semester, the November deposit is 6/12 x (S/ 5,000 + S/ 5,000 / 6) = S/ 2,916.67. / About US$846.39 per semester deposit.Texto Único Ordenado del Decreto Legislativo Nº 650, Ley de Compensación por Tiempo de Servicios (Decreto Supremo Nº 001-97-TR), Art. 9, 18, 21 and 22, 1997-03-01 official text · verified 2026-10-28

7. Workers are entitled to 30 calendar days of paid vacation for each full year of service, provided they meet the attendance record (260 days worked on a six day week, 210 days on a five day week). A worker who leaves after a full year without taking vacation is paid the full vacation pay, and incomplete years are paid by twelfths and thirtieths. If vacation is not taken within the year after it is earned, the worker receives pay for the work, pay for the vacation and an indemnity of one more salary.
Cost to do it: Vacation is paid inside the 12 monthly salaries; the cost risk is the extra salary indemnity when vacation is not taken on time.
Example: A worker on S/ 5,000 who does not take earned vacation within the following year is owed S/ 5,000 for the work, S/ 5,000 for the vacation and a S/ 5,000 indemnity. / The indemnity alone is about US$1,450.96.Decreto Legislativo Nº 713, Art. 10, 22 and 23, 1991-11-08 official text · verified 2026-10-28

8. Employers pay a health contribution to EsSalud of 9 percent of each worker's pay, declared and paid monthly. Pensions are funded by the worker, not the employer: the employer withholds the contribution and pays it over, 13 percent of monthly pay for workers in the public system (ONP), or the private pension fund (AFP) contribution for workers who chose that system.
Cost to do it: Employer cost 9 percent of pay; on S/ 5,000, S/ 450.00 a month (about US$130.59). The 13 percent ONP contribution, S/ 650.00, comes out of the worker's pay.
Example: On S/ 5,000 the employer pays S/ 450.00 EsSalud and withholds S/ 650.00 for ONP, so the worker receives S/ 4,350 before income tax withholding. / About US$130.59 employer health contribution and US$188.62 withheld for the pension.Ley Nº 26790, Ley de Modernización de la Seguridad Social en Salud; ONP contribution as published on gob.pe, Ley 26790 art. 6 a), 1997-05-17 official text · verified 2026-10-28

9. Companies with business income and more than 20 workers share part of their annual income before taxes with their workers: 10 percent for fishing, telecommunications and industrial companies, 8 percent for mining, wholesale and retail trade and restaurants, and 5 percent for other activities. Half is split by days worked and half by pay, each worker's share is capped at 18 monthly salaries, and any excess goes to a regional training and employment fund. The share is calculated on taxable income after loss carryforwards and must be paid within 30 calendar days after the deadline for the annual income tax return. Headcount is the monthly average over the year.
Cost to do it: 5 to 10 percent of taxable income, depending on the activity, paid as a labor cost.
Example: A software services company (other activities, 5 percent) with 40 workers and taxable income of S/ 2,000,000 distributes S/ 100,000 to its workers. / About US$29,019.15 from taxable income of about US$580,383.05.Decreto Legislativo Nº 892 and its regulation, Decreto Supremo Nº 009-98-TR, DL 892 art. 1, 2, 3, 4 and 6; DS 009-98-TR art. 2, 1996-11-11 official text · verified 2026-10-28

10. Employers must give preference to Peruvian workers. Foreign staff may be up to 20 percent of the total headcount and their pay up to 30 percent of the total payroll; employment contracts with foreigners must be written, for a fixed term of up to three years, renewable, include a commitment to train Peruvian staff, and be approved by the labor authority. The limits do not apply to some foreigners, such as those with a Peruvian spouse or close relative, immigrant visa holders and nationals of countries with a labor reciprocity or dual nationality agreement, and employers can request exemptions for specialist professionals or managers of a new business.
Cost to do it: No fee in the law cited; the cost is planning headcount and payroll within the 20 and 30 percent limits or preparing an exemption request.
Example: A company with 30 workers and a monthly payroll of S/ 150,000 can have at most 6 foreign workers, earning together at most S/ 45,000 a month, unless an exemption applies. / Foreign staff pay cap about US$13,058.62 a month on a payroll of about US$43,528.73.Decreto Legislativo Nº 689, Ley para la Contratación de Trabajadores Extranjeros, as amended by Ley Nº 26196, Art. 1, 2, 3, 4, 5 and 6, 1991-11-05 official text · verified 2026-10-28

Item	Soles	US dollars
12 monthly salaries (vacation paid inside)	S/ 60,000.00	US$17,411.49
Two gratificaciones (July, December)	S/ 10,000.00	US$2,901.92
Extraordinary 9 percent bonus on gratificaciones	S/ 900.00	US$261.17
EsSalud 9 percent on monthly pay	S/ 5,400.00	US$1,567.03
CTS deposits (May and November)	S/ 5,833.33	US$1,692.78
Total annual cost	S/ 82,133.33	US$23,834.40
Cost as a multiple of 12 salaries	1.37x	1.37x

Annual employer cost of a worker on S/ 5,000 a month without children, before profit sharing and income tax withholding (DS 003-97-TR, Ley 27735, Ley 30334, DS 001-97-TR, Ley 26790; S/ 3.446 per US$, read 28 October 2026).

Activity	Share of annual income before taxes
Fishing	10 percent
Telecommunications	10 percent
Industrial	10 percent
Mining	8 percent
Wholesale and retail trade and restaurants	8 percent
Other activities	5 percent

Statutory profit share by activity (Decreto Legislativo Nº 892 art. 2; companies above 20 workers on average; cap of 18 monthly salaries per worker).

Worked example

A Chilean group's Lima S.A.C. hires a sales manager on 1 July 2023 at S/ 5,000 a month (about US$1,450.96) under a written indefinite contract with an 8 hour day and 48 hour week (TUO DL 728 art. 4; TUO DL 854 art. 1).
Each month the company pays S/ 450.00 of EsSalud and withholds S/ 650.00 for ONP if the manager is in the public pension system, so the manager receives S/ 4,350 before income tax withholding (Ley 26790 art. 6; ONP 13 percent).
In July and December it pays a S/ 5,000 gratificación plus a S/ 450 extraordinary bonus, and by 15 May and 15 November it deposits S/ 2,916.67 of CTS each time (Ley 27735; Ley 30334 art. 3; DS 001-97-TR art. 21 and 22).
The year's total cost is S/ 82,133.33 (about US$23,834.40), 1.37 times the 12 monthly salaries, before any profit share.
If the company ends the relationship on 31 October 2026 without a cause it can prove, it owes 1.5 x S/ 5,000 x 3.33 years = S/ 25,000.00 (about US$7,254.79), plus pending CTS, proportional bonuses and vacation (TUO DL 728 art. 38; DL 713 art. 22).

Step by step

Before the first hire, have the company formed and registered with SUNAT, since payroll contributions are declared and paid monthly through SUNAT (see Choosing an entity).
Decide the contract type: indefinite by default; use a written fixed term contract only for a cause the law lists, stating that cause and the term, and track the five year combined limit (TUO DL 728 art. 4, 72 and 74).
Pay at least S/ 1,230 a month for a full time worker from 1 October 2026 and watch for the 2027 decree that sets the S/ 1,300 step (DS 015-2026-TR).
Each month declare and pay 9 percent EsSalud and the withheld pension contribution (13 percent ONP or the worker's AFP) (Ley 26790 art. 6; gob.pe ONP page).
Ask each new worker in writing to choose a CTS depositary by 30 April or 31 October; deposit CTS within the first 15 calendar days of May and November (DS 001-97-TR art. 21 to 23).
Pay the gratificaciones and the 9 percent extraordinary bonus in the first half of July and December (Ley 27735 art. 5; Ley 30334 art. 3).
Schedule each worker's 30 days of vacation within the year after it is earned (DL 713 art. 10 and 23).
If the company has more than 20 workers on average, compute the profit share on taxable income and pay it within 30 days after the annual income tax return deadline (DL 892 art. 2, 4 and 6; DS 009-98-TR art. 2).
Before hiring foreign staff, check the 20 percent headcount and 30 percent payroll limits, sign a written fixed term contract of up to three years and obtain labor authority approval (DL 689 art. 2, 4 and 5); see the immigration rules for the visa itself.

Common traps

Fixed term contracts that are not written, lack an objective cause or continue past their term turn into indefinite employment, which then needs a proven cause or the arbitrary dismissal indemnity to end (TUO DL 728 art. 72 and 77).
The trial period protects only the first three months; after that, any dismissal without a cause the employer can prove in court costs 1.5 salaries per year of service (TUO DL 728 art. 10 and 38).
Gratificaciones carry no contributions, but the 9 percent EsSalud amount still has to be paid to the worker as an extraordinary bonus, so the saving is not the employer's (Ley 30334 art. 1 and 3).
CTS computable pay includes one sixth of the bonuses, so the fund costs more than one salary a year; late deposits are a separate liability (DS 001-97-TR art. 18 and 22).
Vacation not taken within the following year triggers an extra salary as indemnity (DL 713 art. 23).
Profit sharing is a cost on top of the 29.5 percent corporate tax: in fishing, telecom and industry it takes 10 percent of taxable income before tax, and it applies once average headcount exceeds 20 (DL 892 art. 2; DS 009-98-TR art. 2).
Workers with children under 18 are owed a family allowance of 10 percent of the minimum wage, S/ 123 a month at the October 2026 minimum, unless pay is set by collective bargaining (Ley 25129 art. 1 and 2).
The minimum wage is changing: S/ 1,230 now, with S/ 1,300 announced for the first half of 2027, so budgets should assume the second step (DS 015-2026-TR art. 1.2).
Foreign staff above 20 percent of headcount or 30 percent of payroll need an exemption, and their contracts need labor authority approval (DL 689 art. 2, 4 and 6).

Sources

← Taxes in Peru: the core system for foreign investors, from the 29.5 percent corporate tax and 5 percent dividend withholding to IGV, interest limits, losses and SUNAT's review periodsVisas and residence in Peru: migratory statuses, the worker, investor and rentista routes, permanent residence, the carné de extranjería and fines →