El Salvador: Aspects to Consider in Hiring Foreigners in El Salvador  

March, 2020 -

In our country there are a large number of transnational companies that have their operations in El Salvador, this due to the cost of labor, and the geographical position of our country that allows it to be a point of connection with other jurisdictions.

It is common to realize that in many companies foreign personnel are hired and are even placed in leadership positions, so it is important that we are prepared with the applicable legislation in this type of hiring.

In El Salvador, the Immigration Law was a regulatory body that had been included in the Immigration Law since 1958 and the Immigration Law in 1986. With a latent need for reform, it was recently incorporated in the middle of the year two thousand and nineteen, through Legislative Decree Number 286, the Special Law on Migration and Aliens, which regulates in a single regulatory body those related to migration, aliens, passport issuance and authorizations to enter the Republic of El Salvador. This law establishes novel processes where requirements have been eliminated and it has become a more expeditious process.

For this, we must consider that when a foreign person enters the country, as a tourist, they have a period of up to 90 days to stay in the territory in a regular capacity. After this period you have various options:

1) leave the CA-4 region that includes: Guatemala, Honduras, Nicaragua and El Salvador.

2) Request an extension of the tourist visa for a maximum of 90 days.

And as soon as you re-enter, the term is renewed, but it is important to take into account that since you have constant income to our territory, they can be approached by a migration officer where you will be warned that you must regulate your immigration situation in the country.

In order to advise on the immigration status of a foreign person in our territory, the following factors must be taken into account:

  1. Nationality

  2. Activity to develop

  3. Period

  4. Place where you will receive payment remuneration

We will begin to develop each of the factors and see the importance of each of them.

In the case of nationality, depending on the quality of the foreign person, this will be the residence, fees and institutions involved in said process. When foreigners are from the CA-4 region, only the procedure is carried out before the General Directorate of Migration and Aliens, and the treatment they are offered is that of nationals.

This implies that in the restrictions established in Art. 7 and 8 of the Labor Code, where the total payroll of companies is considered, 90% must be national, and only 10% foreign, and the amount of wages, 85% of the total return must correspond to nationals and 15% to foreigners.

These restrictions in the case of Central Americans are not applicable, but yes, in the case of foreigners of other nationalities. It is important to mention that there are percentage alteration procedures, if required, that allow us to vary between the payroll percentages (90/10) and the wage restriction percentages (85/15). For these assumptions, specialization criteria must be followed for the work to be carried out that is difficult to substitute to justify the growth of these percentages.

The second factor is the activity to be developed that goes hand in hand with the quality they hold, since you can choose a legal representative, having a mandate, or power conferred by a company, or for work when hired by a Salvadoran society. , including also the independent worker. In these cases, what varies are the requirements and supporting documentation that must be evaluated in each specific case.

The third factor is the period, since depending on the period that the foreigner will be, it is possible to determine for how many years the migratory permit will be extended. A change with the Special Immigration and Aliens Law is that the faculty to process residence from 1 to 2 years was incorporated, with the possibility of extension.

Finally, we have the place where they will receive the payment of the payment, since in this Law the Temporary or Transitory Residences have been designed, which are for foreign people who have a contract with a foreign company that must carry out activities in the national territory, but that they will not receive payment in the territory, nor will they have registrations with the Pension Fund Administrators or the Salvadoran Social Security Institute. Another important factor of this type of residences is that since they are not contracted, parameters 90/10 and 85/15 established by our Labor Code are not taken into account.

We are currently in a scenario where immigration advice prior to hiring is key, because it makes operations efficient and reduces costs that may arise from the imposition of fines, where with current legislation they are minimum wages depending on your rating between mild, severe and very serious, with percentages of the current minimum wage.

In addition to this cost, travel expenses should be considered, as they have to leave the territory after the expiration of the term as tourists, and the sanctions that are applicable not only for the worker but also for the employer. To this is added the affectation to the image that is projected as a company, since before the institutions of the Ministry of Labor and the General Directorate of Migration and Aliens, they would begin to see themselves as non-compliant with the law, and may lead to further inspections and control by them.

With all the reforms that have arisen, it is important to emphasize that adequate advice guarantees the fulfillment of the rights of foreigners, and a search for the type of residence according to each need. In El Salvador, we have the advantage that this is a quick procedure, since once the documentation is presented, the General Directorate of Immigration and Immigration schedules an appointment to take the photograph in a period of approximately 5 business days. At this time the Provisional Card is delivered, which lasts for 3 months, and once this period is completed, resolutions are received where they approve the residence or deny it, as the case may be, and they are given the corresponding definitive card for the period requested.

That definitive card must be - prior to expiration - renewed, as long as the worker's relationship with the employing company exists.

It is important that transnational companies have adequate legal advice, so that what is established by our legislation on immigration is legally complied with, thus generating a minimization of risks in the face of the imposition of sanctions. Resulting in improvements in human resource management of companies with foreign labor capital.



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