Hire in Uruguay without the complexity
Workmate enables you to hire in Uruguay quickly and cost-effectively—no local entity required. Our Employer of Record (EOR) solution manages onboarding, payroll, and benefits, ensuring a smooth, compliant hiring process so you can focus on growing your business.
UYU
Currency
Montevideo
Capital
3.4 million
Population
Spanish
Official language
What is an employer of record ?
As an Employer of Record (EOR) in Uruguay, we act as the legal employer for your employees living in the country, handling all employment responsibilities and liabilities on your behalf. We manage everything end-to-end, including payroll, benefits, taxes, and compliance. By partnering with Workmate, you can hire employees in Uruguay without the complexities of setting up a local entity or navigating intricate labor regulations.
Guide to hiring in Uruguay
Explore the topics below to discover everything you need to know about hiring employees in Uruguay
Payroll & Wage
Minimum wage
As of 2024, the minimum wage in Uruguay is 22,751 Uruguayan Peso (UYU) per month, which is about $741 CAD.
Overtime
A standard workweek is 44 hours at 8 hours per day. Overtime work has a maximum of usually 8 hours per week, and is paid at between 200%-250% of the regular rate.
Social security
Monthly contributions:
Social security (BPS) - 7.5% (up to a salary cap of UYU 256,821)
Health insurance (FONASA) - 5%
Additional fund (FRL) - 0.1%
Guarantee fund (FGL) - 0.025%
Accident insurance - 3.23%
Other contributions:
Severance fund - 1 month salary paid annually
Vacation bonus - 1 month salary
Taxes
The individual income tax ranges from 0% to 36%. Income tax is calculated according to progressive rates. Multiple additional factors may impact overall rates such as the household status and the number of children.
Leave entitlements
Vacation
Employees are entitled to 20 working days of paid time off (PTO) a year. PTO accrues monthly at 1.67 days per month.
Parental leaves
Maternity leave:
Pregnant employees are entitled to 14 weeks of paid leave, with 42 days taken before childbirth. This can be delayed until two weeks before birth with a medical certificate if no prior absences occurred. Social Security pays 100% of the employee’s average salary from the last six months.
Paternatiy leave:
Employees are entitled to 13 days of paid paternity leave, starting from the baby’s birth. The first 3 days are paid by the employer, and the remaining days are covered by the National Health Insurance (BPS) at 100% of the employee’s average salary from the last six months.
Sick leave
Employees are entitled to 20 working days of paid time off (PTO) a year. PTO accrues monthly at 1.67 days per month.
Holidays
Employees are entitled to 20 working days of paid time off (PTO) a year. PTO accrues monthly at 1.67 days per month.
Terminations
Notice period
Notice period is not mandatory and will depend on what is agreed by both parties in the employment agreement.
Severance pay
In Uruguay, employees dismissed without cause, except for misconduct or fixed-term contract expiration, are entitled to severance pay of one month’s salary per year of service, up to six months’ compensation.
Other details
Employment agreements
Agreements or contracts must be in Spanish or bilingual. The following terms are required:
Probation period
Termination conditions
Ordinary or integral salary
Non-salary payments
Probation pediod
In Uruguay, the maximum probation period is 90 days (3 months).