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How to hire remote employees in
OK, so navigating a new country’s labor laws and hiring process isn’t exactly easy. It isn’t easy at all, really. You’ve got two options: You can hire talent in Guatemala as employees, or you can hire them as contractors. Each has their benefits, depending on what you’re looking for. We’ll cover the details below.
If you want to successfully hire in
Guatemala
, you have two options:
Laws about hiring contractors are significantly more simple in
Guatemala
. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Thera for.
This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in
Guatemala
is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.
Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in
Guatemala
.
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
Hiring contractors in
Guatemala
means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
If you’re hiring contractors in
Guatemala
, you can pay them with Thera in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Guatemala than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Guatemala.
Employees are entitled to 15 days of vacation after their first year of service.
There are 12 public holidays.
Sick pay is either paid by the employer or social security, depending on the reason for the sickness, and is paid at 50% of the regular pay rate.
The length of sick pay depends on the length of employment:
Mothers are entitled to 84 days of maternity leave starting from 30 days before the expected due date.
In the event of a miscarriage or stillbirth, the mother is entitled to 42 days of paid leave.
There are no provisions in the law regarding paternity leave.
There are no provisions in the law regarding parental leave.
Labor union leader– up to 6 days of paid leave for a member of a union’s executive committee in order to carry out union duties. Such a person may also be entitled to additional unpaid leave.
Judicial summons– half a day of paid leave.
5 days paid leave for the wedding of the employee.
3 days paid leave in the event of the death of a spouse or child.
In Guatemala, there is no specific termination procedure other than providing written notice and for just cause. There are, however, some instances in which the employer must get permission to dismiss an employee:
The notice period varies based on the length of employment:
Severance payment is only granted when a court finds that an employer was dismissed without just cause. In this case, the employee is entitled to either be reinstated and back paid from the date of termination or are entitled to severance pay equal to one months’ salary for every year employed.
In addition to the above, if the employee has received any non-cash benefits such as the use of an employee car, mobile phone, food, etc., they are entitled to an additional 30% of their salary for each year of employment.
2-months.
The standard workday is 8 hours but cannot exceed 12 hours per day. However, working hours do not apply to high-level executives or domestic workers. In addition, there are some other classifications of workers that working hours don’t apply to such as caretakers, and doormen.
Anything over 44 hours in a workweek is considered overtime and is paid at a rate of 150% of the regular pay.
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