About Panama: Labor Force and Salaries
Executive Decree 7, March 2006, regulates the Minimum Hourly Wage Level for Workers in the Republic of Panama determined by the economic activity and the region where the work is performed.
| Economic Activity | Minimum Wage per Region | ||
|---|---|---|---|
| Region 1 | Region 2 | Region 3 | |
| Agriculture, Hunting, Forestry | |||
| Small Enterprises* | 0.89 | 0.89 | 0.89 |
| Large Enterprises | 0.94 | 0.94 | 0.94 |
| Fishing | 1.17 | 1.17 | 1.17 |
| Mining and Quarry | 1.37 | 1.16 | 1.16 |
| Manufacturing | |||
| Small Enterprises | 1.27 | 1.06 | 0.93 |
| Large Enterprises | 1.36 | 1.13 | 1.03 |
| Electricity, Gas and Water | 1.38 | 1.17 | 1.05 |
| Construction | 1.68 | 1.48 | 1.33 |
| Retail and Hotels | |||
| Small Enterprises | 1.29 | 1.07 | 0.93 |
| Large Enterprises | 1.37 | 1.11 | 1.00 |
| Transportation, storage and communications | 1.37 | 1.16 | 1.00 |
| Finance, Insurance and Realty | 1.38 | 1.35 | 1.34 |
| Communal, social, personal services | 1.35 | 1.13 | 0.99 |
For the application of the Minimum Wage Level, the Republic of Panama has been divided in three regions: * For companies with ten (10) or less employees |
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The list herein included applies to companies and employees that are not part of the CAPAC–SUNTRACS Collective Bargaining Agreement.
CAPAC stands for the Panamanian Chamber of Construction and SUNTRACS stands for the Construction Worker Single Union.
Only when the companies become a part of the CAPAC and the workers organize a union within the company and also becomes part of the SUNTRAC, then the minimum wage rates listed in the CAPAC-SUNTRACT Collective Bargaining Agreement will be applicable.
Please notice that the items to be covered by the employer are:
| Work benefits | Percentage of the gross salary |
|---|---|
| Salary | -- |
| Social Security: | 10.75% |
| Education tax: | 1.50% |
| Workers' compensation: | * |
| Seniority Bonus: | 1.923% |
| Indemnity | 6.54% |
| Vacations | 9.09% |
| Thirteen Month bonus: | 8.33% |
* The employer must cover workers' compensation, which depends on the duties performed by the worker. The Panamanian Social Security assigns the percentage to be paid. |
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