Domestic workers are considered the employees that provide cleaning, assistance, or other services specific to a person’s home or family members on a regular and continuous basis.

The working conditions of domestic workers are regulated in the chapter on Special Contracts of the Labor Code, starting from article 230. Anything not explicitly addressed by these special standards is subject to the regulations applicable to all workers in general, contained in the remaining articles of the Labor Code.

The fundamental aspects in domestic work are:

  1. Work schedule: Domestic workers are not subject to a work schedule. While workers who provide services for a private company have an ordinary working day of a maximum of eight (8) hours in the day shift, the Labor Code does not establish a maximum number of service hours per day for domestic workers. However, it mandates a rest time of at least nine continuous hours, from 9:00 p.m. to 6:00 a.m., with a weekly rest of minimum one (1) full day.
  1. Work on holidays or national mourning: when a domestic worker provides his services on national holiday or mourning, is remunerated with a surcharge of 100% on his daily wage, unlike an employee who works for a private company on a national holiday or national mourning whose remuneration includes a surcharge of 150% on his daily salary.
  1. Termination: The termination of every worker, domestic or not, is considered unjustified and the employer bears the burden of proving the existence of a justified reason for dismissal. According to the law, any verbal dismissal is considered unjustified.

Domestic workers can be terminated without cause as long as the employer pays appropriate compensation, which consists in a severance.

If the termination is made citing one of the justified causes provided in article 213 of the Labor Code, the employer must deliver a termination letter detailing the date and facts on which the termination is based.

  1. Employment Benefits– Acquired Rights: The domestic worker has the right to the same employee benefits as a private sector worker. Which are:
    • Seniority
    • Thirteen-month bonus
    • Vacations

It is important to note that these benefits must be paid regardless of the immigration status of the domestic worker.

I suggest that, at the time of paying the acquired rights, a detail of the amount to be paid should be in writing, as a documentary proof  of the compensation paid in favor of the domestic worker.

  1. Severance: Compensation for termination without cause of domestic workers has a special rate referred to in article 231, numeral 4 of the Labor Code, that says at follows:

For the employer to terminate a domestic service contract without cause, will pay compensation according to the time of service as follows:

    1. From two weeks up to three months, the sum equivalent to one week’s salary;
    2. From three months up to one year, the sum equivalent to two week’s pay;
    3. From one year to two of service, the sum equal to one month’s salary;
    4. From two years up to four years of service, the sum equivalent to two months’ salary;
    5. From four years to six years of service, the sum equal to three months’ salary;
    6. From six years to ten years of service, the sum equivalent to four months’ salary;
    7. From ten years to fifteen years of service, the sum equal to five months’ salary;
    8. From fifteen years to twenty years of service, the sum equivalent to six months’ compensation; and
    9. The sum of twenty years of service equivalent to seven months’ salary.


  1. Social Security Affiliation: It is mandatory for the domestic worker, both Panamanian or foreign without distinction, to be affiliated to the Social Security (CSS) system since any accident that occurs in the workplace is considered a “work accident” or “professional risk”. If something should happen to the domestic worker and it is not affiliated in the Social Security, the damage must be fully covered by the employer. This affiliation also covers the costs of maternity leave and accidents that leave the worker permanently disabled from work.

Sophia A. Lee de Siu

Attorney in  Alcogal

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