Determination of the living wage and economic compensation procedure

The Ministry of Labor issued Ministerial Agreement No. MDT-2026-087, signed on March 30, 2026, through which the living wage value for the year 2025 was established; and, the procedure for the payment of the corresponding economic compensation was regulated.

What does this Ministerial Agreement establish?

It was determined that the value of the living wage for the period between January 1 and December 31, 2025, is USD $ 506.99 per month. This figure was calculated based on the average cost of the basic family basket (USD $811.19) and the average number of income earners per household (1.6 people), according to the report issued by the INEC.

Private sector employers who have not guaranteed their workers a remuneration equivalent to or higher than the living wage during the year 2025 must pay the complementary economic compensation by March 31, 2026. This obligation is calculated based on all remunerations and additional income received during the year, such as thirteenth and fourteenth salaries, profits, commissions, reserve funds, and other economic benefits.

The obligation applies to all natural or legal persons who are private sector employers required to keep accounting records that have generated profits in the 2025 fiscal year or that have paid an income tax advance lower than said profits.

Additionally, employers must exhaust all necessary mechanisms to effect payment to workers and former workers, including direct communications or media publications, in case they cannot be located.

The employer must register the information regarding compliance with this obligation through the system enabled by the Ministry of Labor, being responsible for the veracity of the reported information.

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