Navigating HR in Puerto Rico: Key labor obligations for 2025
Effective practices attract talent, build trust and ensure long-term success, says Vanessa Boneta.
Managing human resources in Puerto Rico involves balancing local and federal labor laws. Here’s a concise guide to the critical employment obligations for 2025 to help you stay compliant and foster a fair workplace.
Work hours and overtime
Puerto Rico adheres to the federal 40-hour workweek, but overtime is triggered after eight hours in a single day at 1.5 times the regular rate. Act 4-2017 allows flexible scheduling agreements with employees, benefiting both parties, but ensure all agreements are documented to avoid disputes.
Minimum wage and pay
The current minimum wage is $10.50 per hour, but certain industries, like hospitality and manufacturing, may have unique rates. Regularly review legislative updates, as wage policies can change unexpectedly.
Leave policies
Puerto Rico requires employers to provide vacation and sick leave, surpassing benefits in many U.S. states.
- Vacation leave: Employees hired after Jan. 22, 2017, accrue leave based on tenure:
- 6 days in the first year
- 9 days up to the fifth year
- 12 days up to 15 years
- 15 days after 15 years
- Sick leave: Non-exempt employees accrue leave under Act 180-1998, amended by Act 41-2022, which adjusts accrual for those working under 115 hours per month.
- Maternity leave: The Working Mothers Act provides eight weeks of paid leave, a significant benefit and compliance requirement.
Ensure your HR systems accurately track leave accruals to meet these regulations.
Health insurance
While health insurance is not mandatory in Puerto Rico, many employers offer it to remain competitive. Puerto Rico adopted the Affordable Care Act (ACA), applying Metallic Plans (Platinum, Gold, Silver, Bronze) for employers with 2–50 employees. Employers contributing to group plans must not exceed 50% of the payroll deductions.
Workplace discrimination and harassment
Puerto Rico enforces strict anti-discrimination laws, including Act 90-2020 (Workplace Harassment Law). Additionally, the Hair Styles Act 106 of 2024 prohibits discrimination based on hair texture or protective hairstyles associated with racial or ethnic groups. Employers should review policies and provide training on equal employment, antidiscrimination and anti-harassment guidelines.
Affirmative action
Organizations receiving federal funding or working with the federal government must implement Affirmative Action Plans (AAPs). These plans promote diversity in hiring and employment decisions, particularly for women, individuals with disabilities, and veterans. Ensure annual compliance by conducting audits and training management on inclusive hiring practices.
Terminations and severance
Puerto Rico’s Unjust Dismissal Act (Act 80) mandates just cause for terminations. Otherwise, employers must provide severance based on the employee’s tenure. Familiarize yourself with the law’s formula to calculate severance accurately.
Best Practices for 2025
1. Stay informed: Consult legal or HR experts to stay updated on labor laws.
2. Update employee manuals: Regularly review and reaffirm policies to maintain compliance.
3. Train your team: Conduct regular training on labor laws, rights and responsibilities.
4. Maintain accurate records: Ensure precise payroll and leave tracking and follow I-9 verification protocols as required by Homeland Security.
5. Consult specialists: An experienced HR consultant can help navigate complex regulations and enhance compliance.Building a fair workplace
Compliance is not just about avoiding penalties — it’s about creating a supportive and equitable work environment. When you get it right, you’ll attract top talent, foster trust and position your business for long-term success.
Author Vanessa Boneta is managing partner for Newland HR Services in Puerto Rico. Send comments to [email protected].
