Corporate Migration
Corporate or labor migration refers to the process of moving workers from one country to another, either temporarily or permanently, to perform a specific job. If you are thinking of hiring qualified foreign employees or transferring your employees to a company in Panama, it is important to have the advice and help of a law firm specialized in labor migration, such as Guerra-Dajer & Asociados.
Our Panama law firm is highly trained to help you meet the legal requirements necessary for a successful labor migration in Panama, and to ensure that the process runs smoothly and effectively. It is important to bear in mind that a bad labor migration can bring negative legal and economic consequences, such as fines and sanctions by the immigration authorities, delays in the processing of documents, and problems with the personnel.
Benefits
The benefits of having a law firm in Panama for labor migration are several. First of all, we help you comply with all the legal and immigration requirements necessary for your foreign employees to be able to work legally in Panama, which in turn protects you from possible sanctions and fines. Secondly, we provide you with personalized and expert advice so that you can make informed and strategic decisions regarding the labor migration of your employees.
By April 2023, the Ministry of Labor and Labor Development classifies work permits into 6 types
1. Work Permits that are equivalent to local labor:
Those foreigners who, according to the regulations of the Law, who are considered with the same treatment as nationals due to their condition and rootedness in the country, be it for having more than 10 continuous years in the country, for being fathers or mothers of children Panamanians, married to nationals, etc.
2. Percentages Authorized by the Labor Code:
They are the percentages of 10% ordinary personnel and 15% specialized or technical personnel.
3. Special Laws:
Applicable to all provisions of business regimes or economic activities of companies with special regulations (Multinational Companies, Manufacturers, Cinematography, etc.), as long as the provisions establish that they need a work permit.
4. Humanitarian Protection:
For the cases of people in refugee status or refugee process, asylum seeker, separated person or foreign victim of trafficking in persons. Including for the first time the recognition of stateless persons (people who do not have a record of any nationality, but are in the national territory).
5. Special Conditions:
That regulates the work permits of foreigners from countries that maintain friendly or economic relations with Panama, Immigration Regularization, Professional Foreigners or students, and for the first time a work permit for self-employed or self-employed workers.
6. Temporary:
applicable to international artists, specialized technicians and artists of night shows.
Main changes introduced by Decree April 4, 2023
A. Categories of Work Permits Equivalent to Local Labor.
a. Foreigners with ten (10) or more years of residence in the country:
The ten (10) years will be computed from the first resolution of the National Immigration Service that authorizes the foreign person the provisional permit to stay in Panama.
In the case of a foreign person who entered the country as a minor, the term of ten (10) years of residence will be computed, continuously, from the date of entry into the national territory indicated by their status certificate. migratory.
b. Foreigners with a spouse of Panamanian nationality:
Which is classified: (i) current marriage; (ii) by parental authority in the event of divorce; or (iii) parental authority in case of widowhood.
This decree establishes specific requirements for the category of parental authority (in case of divorce or widowhood).
c. Aliens with Special Permanent Residence;
d. Foreigner as father or mother of a person of Panamanian nationality in condition of dependency (Panamanian Son);
e. Foreigners with Residence under the Treaty of Friendship, Commerce and Navigation between Panama and Italy;
f. Foreigners dependent on diplomatic, consular, administrative personnel and international organizations accredited in Panama.
It is established that dependents have the right to request a valid work permit for the term of the stay in the country of diplomatic, consular or international personnel.
B. Categories of Work Permits that Count within the Percentages Authorized by the Labor Code.
The percentages of foreign labor and salary established by article 17 of the Labor Code are maintained, for which reason in the same company there may be ordinary personnel within 10% and technical or trust personnel within 15% of the total number of workers. , excluding both percentages from each other.
1. Foreigners Hired as Ordinary Personnel Within 10% of the total number of workers.
2. Foreigners Hired as Specialized or Technical Personnel within 15% of the Total Workers.
A new requirement is established that the company that requests a work permit as a specialist or technician within the 15%, must comply with the transfer of knowledge and the training of personnel, for which it may: (i) Create a center of teaching, (ii) Adopt training programs with universities or educational centers, or (iii) Present evidence of their training program in the field.
3. Foreigners Hired as Trusted Personnel within 15% of the Total Workers.
4. Foreigners Hired as Micro or Small Employer Personnel (MIPE).
This permit supersedes the Marrakech Agreement. It is established that the company can have up to nine (9) workers including the foreign worker, for which the applicant must be the only foreigner in the company.
5. Foreigners Hired as Trusted Personnel Whose Transactions are Perfected, Consumed or Have Effects Abroad, Exclusively.
To request the extension of the work permit, the applicant must provide a bank certification or account statement that shows that his salary comes from a foreign source.
C. Categories of Work Permits Established by means of Special Laws.
1. Foreigner hired as an executive by a company in the Colon Free Zone (except for the percentages indicated in Article 17 of the Labor Code).
2. Foreigner hired by an authorized employer within the regime of the City of Knowledge Foundation (they are excepted from the percentages indicated in article 17 of the Labor Code).
3. Foreigner hired by an employer within the Panama Pacific Area.
4. Foreigner hired by an employer within the Free Zone regime.
5. Foreigner hired by an employer within the Multinational Company Headquarters (SEM) regime.
6. Foreigner hired by an employer within the Multinational Companies regime for the provision of services related to Manufacturing (EMMA).
The most relevant changes to the categories of work permits for SEM and EMMA personnel are the following:
A work permit is created for Trusted Foreigners in Positions of Middle and High Level Managers (Permanent Personnel) SEM as well as for EMMA.
It is established that SEM and EMMA Personnel Dependents may only request work permits within the percentage categories authorized by the Labor Code.
Foreigner hired as trusted personnel by an employer within the regime of the cinematographic and audiovisual industry.
Foreigner hired as a pilot or specialized personnel of a commercial aviation company.
D. Categories of Work Permits for Foreigners Under the Protection of the Panamanian State.
– Foreign refugee who has been (i) admitted for processing and (ii) recognized as a refugee.
– Asylum foreign.
Foreign stateless.
– Foreign victims of trafficking.
– Foreigners with temporary status for humanitarian reasons.
E. Categories of Work Permits for Special Conditions.
– Specific Countries (Friendly Countries).
– General Immigration Regularization.
– Professional Foreigner.
– Family reunification for dependents.
- Student.
The most relevant changes of these categories of the categories by Special Conditions are:
These work permits will be subject to a contracting limit, in accordance with the provisions of articles 17 and 19 of the Labor Code and in Title II, Chapter VI of this Executive Decree.
Applicants for work permits for special conditions must comply with the conditions of self-employment or work for others, which may be as a natural person or through a legal entity.
Foreigners who have residence as a student may apply for a work permit.
F. Established Work Permits for Temporary Workers.
Within the work permits established for Temporary Workers are the following:
– Temporary technicians.
- Athletes.
– Artists.
– Workers of the night show or alternators.
The most relevant changes in these categories are:
These temporary workers are not included in the percentages established in Article 17 of the Labor Code.
The possibility is introduced that prior to the worker's entry into the country, employers can announce to the Ministry of Labor, through a lawyer, the promise to hire a foreign person providing: (i) letter of responsibility, (ii) contract work certificate that complies with the pertinent legalizations and endorsement and (iii) proof of the date of entry into the country. The rest of the requirements must be presented no later than three (3) business days, counted from the entry of the foreign person into the country.
Foreigners who enter the country to carry out activities at the managerial level, that do not generate local income, for a maximum of fifteen (15) calendar days, must inform the Ministry of Labor through a lawyer.
Companies that receive foreign suppliers that enter the country to carry out work inherent to terms of guarantees or similar and do not generate local income, are obliged to inform the Ministry of Labor through a lawyer.
General and common provisions for work permits:
A. Term to Resolve Work Permit Applications.
The period within which each work permit application must be resolved is extended from thirty (30) business days to forty (40) business days.
B. Appeal for Reconsideration.
A term for filing the appeal for reconsideration is established from two (2) business days to five (5) business days, counted from the notification of the resolution. Similarly, a new term is established for the provision of evidence, which must be announced in the appeal for reconsideration, of fifteen (15) business days.
C. Certification of the Form of the Social Security Fund.
Companies that have more than twenty (20) workers must provide a certification of the payroll of the Social Security Fund, issued by an Authorized Public Accountant.
D. Extensions and Validity of Work Permits.
The term to submit requests for extensions of work permits is modified, from thirty (30) business days, to at least sixty (60) calendar days before the expiration of the permit.
The terms of validity of each work permit are detailed, according to category, its extensions and the number of possible extensions.
The prices of work permit cards will be established by Ministerial Resolution.
E. Cancellation of Work Permits.
The grounds for cancellation of work permits are established, including: (i) declaration of falsehood of any document presented; (ii) loss, revocation, cancellation, cessation, withdrawal of the immigration permit; (iii) transfer of the foreign person hired in one company to another, without authorization from MITRADEL; among others.
F. Infractions and Administrative Penalties.
Employers who keep foreigners in the process of work permit extension will not be penalized, as long as they verify that they are still in process and that said extension was requested before the expiration of the work permit.
How do we help you?
Services:
- We indicate the type of visa or residence according to the needs of the organization.
- We develop an adequate administration of the company's payroll.
- Know and control contracting risks and their costs.
- Keep your records in order.
- Advice on payment of corresponding taxes, for the prevention of fines.
Do you need help with the labor migration of your employees?
Don't worry! Guerra-Dajer & Asociados, our law firm specialized in labor migration in Panama, is here to help you. Don't wait any longer, contact us today to get the help you need.
