We’re into December and here at Mauve festivities are in the air! The festive period is a time when extra financial support from your employer and a little reward for all your hard work throughout the year is extremely welcome; labour departments in many countries seek to guarantee employer generosity by applying compulsory bonuses and 13th salaries in December. To signal the start of the season, we’re highlighting five countries around the world which spread some extra Christmas spirit with obligatory festive bonuses.
In Austria, 14 salaries are paid a year; one at the end of June and one at the end of November in addition to the normal salary payments. These are considered a vacation bonus and a Christmas bonus respectively. Taxation on the 13th and 14th salaries is at a lower rate of 6%.
According to local labour laws, workers in Brazil are entitled to a 13th salary. This is a gratification that corresponds to a month’s salary and it is paid in two instalments, in November and December.
In addition to regular salary, every employee in the Dominican Republic receives, on or before December 20, a so-called “Christmas salary” equal to one-twelfth (1/12) of the total regular salary earned during the year. The Labour Code establishes a maximum Christmas Salary of five times the minimum wage. However, many employers waive this limitation and pay employees who have worked the whole year a full extra monthly salary.
Firms are also required to pay a year-end Christmas bonus (Aguinaldo) to all employees’ equivalent to 15 days’ pay before December 20th of each year. It is customary by some employers to pay a 20-30-day bonus. Those who have worked less than one year receive a pro-rated bonus.
All employees, regardless of the amount of their monthly basic salary, their designation or employment status, and the method by which their salary is paid, provided they have worked for at least one month during a calendar year, are entitled to a bonus called “13th month pay”. This should be equivalent to at least 1/12 of the total basic salary that the employee earned within a calendar year. The required 13th month pay should be paid not later than 24 December of each year. Nonetheless, an employer may give its employees half of the required 13th month pay before the opening of the regular school year in June and the other half on or before 24 December. The frequency of payment of the 13th month pay may also be the subject of an agreement between the employer and the collective bargaining agent of his employees.
To avoid fines and penalisation, ensure your payroll arrangements for your expatriate and local overseas employees this Christmas operate in-line with the labour laws of that country. Mauve Group can offer more detailed information and a full range of services in all of the countries detailed above, and more. For in-depth advice and analysis, contact us via the Contact Form.BACK TO NEWS