If you’re new to the Dominican Republic there are important labor laws and cultural norms you should be aware of—especially around salaries, severance, and bonuses. Whether you’re buying/renting a home for yourself, operating a rental investment, or running a small business in the Dominican Republic, hiring staff might be part of your plan.
I’m Gigi Tea and I’m a real estate agent in Cabarete living in the DR since 2012. Something cool about living here is how normal it is to have a house cleaner, nanny, or gardener on staff. In other parts of the world these are luxuries afforded by few, but here in the DR, regular people might have staff help run their household. From your nanny to the guy who washes your car every week, your team is expecting a christmas bonus.
In this blog I will break down what you need to know about salaries and bonuses before hiring anyone so you can avoid misunderstandings and ensure you maintain a good relationship with the people who help run your property or business.
Why Dominican Labor Laws Exist
I’ve said it before and I’ll say it again: Dominican Problems need Dominican Solutions. The Dominican Republic’s severance law originates from the Dominican Labor Code (Código de Trabajo), which was enacted on May 29, 1992. Before 1992, things were kind of messy when it came to labor laws in the DR. There were some rules, but nothing that really protected workers in a clear or consistent way. Most jobs, especially things like housekeepers, builders, and farmhands, were informal. Employers could let someone go without warning or reason, and that was that—no pay, no process.
Eventually, pressure built up—from inside the country and internationally—to make things fairer and more modern. Law No. 16-92 was put in place.
Fast forward to today, let’s go over Dominican labor laws. Because the Dominican Republic lacks a strong unemployment insurance program, employers are made responsible for severance pay. This way the government ensures that workers have some financial security after losing their jobs.The laws also protect workers from sudden unemployment, ensuring they have a financial cushion through vacation, bonuses, and severance. In turn, the laws also create a safety net for workers that helps build trust in employer-employee relationships, they promote job stability, and discourage arbitrary dismissals. Employers are incentivized to retain trained workers rather than constantly hiring and firing, which helps maintain a more stable workforce —especially within small businesses and private homes.
Minimum Wage & Average Salaries in the Dominican Republic
The minimum wage in the Dominican Republic varies based on company size and ranges from
RD$16,886 to RD$29,988 per month (~$268 to $477 USD).
However, household employees such as maids, caretakers, or nannies working full time typically earn between
RD$18,000 and RD$24,280 per month (~$296.54 to $400 USD),
Of course some workers earn more.
Bonuses & Benefits: What You’re Obligated to Pay When You Part Ways
The overall severance package, referred to locally as “liquidacion” consists of four parts: Christmas bonus, Vacation Pay, Severance Pay, and Pre-notice.
You can use the official Dominican Ministry of Labor calculator to verify the amounts based on your exact case. The calculator lets you choose the exact start date and end date, enter salary amount as well as any bonuses, then it will calculate exact amounts owed for you.
Regalía Pascual (Christmas Bonus)-
Every Dominican employee is entitled to the Regalía Pascual, which must be paid by December 20. It equals one-twelfth (1/12) of the salary the employee has earned from January 1 to December 15. You might hear people call this “el doble” because although this is different than the December paycheck, it comes in December and so it feels like a double salary for that month. EVERY WORKER IS EXPECTING A CHRISTMAS BONUS. If you have an employee that’s been with you 24 days, they are still entitled to a 12th of that. Come December do not let the Regalia pascual surprise you.
Vacation Pay
After one year of work, employees are entitled to 14 paid vacation days. If they have been working half a year, it’s a 7 days vacation pay. Best to refer to the calculator. Most employers will ask if an employee wants the 14 days vacation or do they prefer to come to work and essentially get paid double for it. It is important to let employees choose, if for some reason it is impossible to have your employee be out for 14 days together it is possible to spread the vacation over the year, but 14 days of paid vacation is a right that every worker is entitled to. For example someone earning RD$30,000/month, that vacation payout equals approximately RD$14,000.
Severance (Cesantía)
This payment applies if you terminate an employee without just cause. The law grants:
- Less than 3 months – No severance owed
- 3 to 6 months – 6 days of pay
- 6 to 12 months – 13 days of pay
- 1 to 5 years – 21 days of pay per year worked
- More than 5 years – 23 days of pay per year worked
- More than 10 years – 26 days’ salary per year worked
Household workers, however, are not legally entitled to severance pay, although some employers choose to offer it voluntarily as a gesture of goodwill. In the Dominican Republic it is a cultural norm to “liquidate” all workers, be they working in a household or not so we suggest you do 🙂
The labor code only kicks in those benefits starting after 3 months of continuous work. In other words, if they’ve been employed for less than 3 months, no severance (cesantía) is owed. However, you’d still need to pay any pending salary or vacation days earned or possibly bonuses or regalía, if the timing falls near December.
Pre-Notice (pre-Aviso)
Preaviso is your notice period—a heads-up you’re supposed to give (or get) when ending an employment relationship.So, if you’re firing someone without just cause, you either give them advance notice that their job is ending, or pay them preaviso compensation instead of the notice.
The amount of notice you are required to give depends on how long they’ve worked for you:
- Less than 3 months → 7 days notice
- 3 – 6 months → 14 days notice
- More than 6 months → 28 days notice
If an employee quits, they’re also supposed to give you notice—but if they don’t, you technically have the right to deduct that from their final pay (though most people don’t push that unless it’s a big issue). It’s part of the overall termination package, and yes—it’s separate from severance pay (cesantía) and vacation payout.
Real-Life Example: Housekeeper Earning RD$30,000/Month:
Let’s say you employ a housekeeper earning RD$30,000/month, here’s what you’d owe upon termination without cause for 3 months, 6 months, 1 year, or 5 years:
Remember these laws are to protect workers and provide a safety net, when you look at this way it’s almost like 3 months: almost 1 month pay – 6 months: almost 2 months pay – 12 months: almost 4 months pay –5 years: a little over 6 months pay.
Final Thoughts for Homeowners and Employers
If you’ve decided to buy a house in the Dominican Republic or you’re already managing a rental property, hiring staff might come with the territory. Make sure you’re budgeting not just for the monthly wage, but also for annual benefits and potential termination costs. Even if you have a part-time worker like a pool guy that comes once a week, you should still follow these rules and refer to the calculator when ending a working relationship.
If you’re already living the good life here in the DR, working with a real estate agent in the Dominican Republic, considering Cabarete real estate, or searching for new business opportunities, staying informed will keep your investment and your peace of mind protected. Feel free to ask me any questions. My email is [email protected] and you should follow my instagram for new posts and info! www.instagram.com/gigitea.rd
All the best,
Gigi Tea