This guide has important information for businesses looking to hire employees or contractors in The Dominican Republic.
Globalify offers Employer of Record solution in The Dominican Republic. Hire remote employees without the headache of managing the local compliance issues.
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Dominican Republic Country Guide for Hiring Employees and Contractors
Dominican Peso
Santo Domingo
Spanish, English.
North America (Caribbean)
10.8 Million
$109 Billion
Per Capita Income
GDP Growth Rate
12.3% (2021)
Date Format
Fiscal Year
January 1 to December 31
Payroll Cycle
Monthly/Every two weeks
Major Religions
Country Highlights Section
Dominican Republic is a country located on the island of Hispaniola in the Greater Antilles archipelago of the Caribbean region. It occupies the eastern five-eighths of the island, which it shares with Haiti.
Its area is 48,671 square kilometers (18,792 sq mi). Almost 30% of the country’s population lives in the capital city of Santo Domingo.
The Dominican Republic is the largest economy in the Caribbean and Central America according to the World Bank. It’s the seventh-largest economy in Latin America. The economy of Dominican Republic has expanded by an average of 5.3 percent during 2000–19.
Tourism, remittances, foreign direct investment, mining revenues, free-trade zones, and telecommunications are the major economic growth engines. The country is expected to realize its ambition of achieving high-income status by 2030.
Dominican Republic is a popular nearshore outsourcing destination for back office and customer care. Many Dominicans speak both Spanish and English, making it an attractive destination to outsource dual-language customer support.
Globalify has a presence in The Dominican Republic. Contact us today to start building your remote team in Dominican Republic.
Hiring in The Dominican Republic
A business needs a local entity in The Dominican Republic to hire locally.
Setting up an entity in the Dominican Republic involves registering with multiple agencies and can take 45-60 days. All documents have to be filled up in Spanish. You also need to register with the Department of Labour before you can hire any employee.
As per the new regulations, the person authorized to operate the account must be present to set up the bank account. Opening a bank account for a business can take 20-30 days due to the time needed to verify various documents.
You will also need to comply with benefits, payroll, tax, and HR laws.
Dominican Republic differentiates between employees and contractors. There are different rules for both, and incorrect classification can lead to fines.
With Globalify, you can bypass all these legal issues and get started in just a few weeks with your remote team in Dominican Republic.
Minimum Wage in Dominican Republic
There are different minimum wage laws for public and private sector in the Dominican Republic. Private sector minimum wage in depends on the number of employees and annual sales of the business.
In addition to the minimum wages, many employers also pay one month’s salary as a Christmas bonus, making the total annual salary to 13-times the monthly salary.
Working Hours in Dominican Republic
Work hours are tightly regulated in the Dominican Republic.
Standard working hours in The Dominican Republic are 8 hours per day or 40 hours per week, Monday to Friday. But it can be extended to 44 hours by adding 4 hours of work on Saturday. Managers can work up to 10 hours per day after an assessment by the Labour Office.
If you employ a part-time worker, you must limit the working hours t 29 or less in a week.
The overtime pay is to be paid at 135% of regular pay for extra hours worked beyond the standard 44 hours in the week. It increases to 200% if the employee works more than 68 hours in a week.
Overtime pay for evening work is to be paid at 115% of regular rate.
Payroll and Taxes in Dominican Republic
Employers typically follow a monthly payment schedule, with salaries paid on the first of every month. Salary is prorated for employees joining in the middle of a month.
In The Dominican Republic, monthly wages are calculated as 4.33 times the weekly wage or 4.33 times the standard hours per week if an hourly wage is given.
Salary must be paid in cash, by check, or by direct deposit to the employee’s account at a bank or other financial institution.
Individual Income Tax
In The Dominican Republic, domestic income is subject to income tax but income from outside is generally not taxed.
The Dominican Republic income tax system follows a slab structure. It means individuals pay income tax based on their income level. This is also called the progressive tax system in which individuals with higher income also pay higher taxes. Employers need to stay on top of these changes to be compliant with tax laws.
The following table shows income tax rates for Dominican Republic:
Employer Costs in Dominican Republic
Employers bear the following costs in Dominican Republic:
Pension Fund: Employers contribute 7.10% of salary and must withhold 2.87% from employee’s salary for pensions. This contribution is mandatory. Annual limit for pension fund contribution per employee is 325,250 Pesos.
Family Healthcare: Employers must contribute 7.09% of salary and also withhold 3.04% from employee’s salary for family healthcare. Annual limit for family healthcare contribution per employee is 162,625 Pesos.
Labour Risks Insurance – Employers also need to pay 1.2% of salary towards labour risks insurance. Annual limit for this tax per employee is 65,050 Pesos.
Technical Education Tax – Dominican Republic has a unique payroll-based tax to finance a program for technical education and training of workers. All employers must pay 1% of total monthly payroll towards this ax. The employees pay 0.5% of bonuses received towards this tax.
Statutory Leave Policies in Dominican Republic
There are 13 National Holidays in The Dominican Republic.
Employees are entitled to a minimum of 14 paid holiday days each year. This increases to 18 days per year after five years of continuous employment. Employees can take the vacation after completing one year on the job.
Vacation time cannot be compensated by any form of payment.
Vacations cannot be taken for less than a week. Employers must pay the salary for the vacation time one day before the vacation time starts.
Expectant and new mothers get 14 weeks of maternity leave. They must have worked for 12 months and contributed to social security for 8 months to be eligible for this.
The employee gets 100% of regular pay during this period. Social security pays 50% of the salary while the employer pays the other 50%. Social security also credits the employers for the salary paid during this time. This helps mitigate the burden on the employer.
New mothers also get three 20-minute breaks during the workday for breastfeeding the child.
Paternity leave
Men get 2 days of paid paternity leave for every childbirth. It must be taken on the day the child is born. Employer must pay 100% salary fir these two days.

Sick Leave
There is no regulation for paid sick leave in the Dominican Republic. However, the social security will pay the employee through the employer if the worker is sick for more than four days:
  • For outpatient treatment, employees get 60% of the base salary
  • In case of hospitalization, employee will get 40% of the base salary
Employee Benefits
Dominican Republic has a comprehensive social security system that offers several mandatory benefits to employees:
  • Retirement benefit
  • Death benefit
  • Disability benefits
  • Short-term sickness benefits
  • Maternity benefits
  • Workmen’s compensation benefits
In addition, many employers also provide supplemental health insurance to their employees. In fact, a good health insurance plan can be a very attractive recruiting tool in Dominican Republic.
Employee Termination
Terminating an employee in The Dominican Republic is complex, unless it’s by mutual agreement.
Contracts can be terminated with mutual agreement or if the contract period is over.
An employee can terminate the employment at will.
If an employer wants to terminate employment unilaterally, then it has two options:
  • Termination due to performance or disciplinary reasons – employer will need to provide proof of misconduct and give 48 hours' notice to the employee.
  • Termination without cause (“at will”) requires a longer notice period and may also involve severance pay. Employees on probation are not eligible for notice period. For others, the minimum notice period is 7 days and varies according to the following table:
The severance pay to be paid to a terminated employee varies according to the following table:
In addition, the employee may be eligible for time off payments according to the following table:
Corporate Taxes in Dominican Republic
The tax treatment for corporations, partnerships, and limited liability companies is similar in most aspects.
Business profits are taxed at 27% in Dominican Republic.
In addition, companies also pay a 1% assets tax, payable when the corporate income tax is lower than the assets tax. This Assets tax is levied on all assets on a company’s balance sheet except shares, rural and agricultural real estate and prepaid taxes.
If you repatriate dividends/profits to the parent entity in another country, you must withhold 10% as a definitive tax payment. Free trade zone (FTZ) entities are also subject to the 10% withholding on profit remittance.