Dominican Republic

Employer of Record in the Dominican Republic

Skuad's EOR (Employer of Record) solution helps your business expand into the Dominican Republic without the need for an entity setup. Our unified and automated global HR platform enables you to expedite the onboarding of your remote team and manage their payroll, benefits, compliances, etc. We help you streamline the global expansion process with the assistance of our international network.

Navigating the legal and employment landscape in the Dominican Republic can be challenging. With Skuad's innovative EOR solution, You can effectively address the HR requirements of your organization. If you wish to know how we can partner with you for your business growth and success, contact Skuad today.

The Dominican Republic at a Glance

Population: 11.4 million

Currency: Dominican peso

Capital City: Santo Domingo

Languages Spoken: Spanish

GDP: USD 113.54 billion

‍What You Must Know Before Employing in the Dominican Republic

The Ministry of Labor governs the employment laws in the Dominican Republic. Any employer willing to hire in the territory must strictly adhere to the laws. Foreigners working on Dominican soil are subject to the provisions of the Labor Code since Dominican labor laws are territorial (Principle V of the Labor Code).

Employers must be thorough with the local rules and compliance regarding working hours, compensation, leaves, social contributions, and more. The table below gives a sneak peek into the basic employee entitlements to keep in mind while employing in the Dominican Republic.

Talk to Skuad experts to know more about Employment laws and rules in the Dominican Republic and how partnering with Skuad can simplify the employment process in the Dominican Republic.

Contractors vs. Full-Time Employees

Full-time Employees are those employees who are hired by your firm and work for specified hours. They receive a fixed salary and a company requires paying social and other benefits to the employees while managing their activities daily. A termination notice is a prerequisite in case an employer aims to end the working relationship with a full-time employee.

Contractors are freelancers who work on a freelance basis. They are paid project-basis and work as per the requirement of the project. The company does not require paying any benefit. Work can be terminated either at any time or by providing a short notice period.

Employment contracts in the Dominican Republic may be verbal or written. A contract exists unless proven otherwise by the employer. It is better to enter into written agreements for a clear and sound work relationship.

In the Dominican Republic, it is better to hire through contractors, because it is not worth the hassle of going through the direct route in this small country. The overall hiring process gets complex due to hiring and retaining the right employees which can be easily done when you have local support. Call Skuad experts to help you deal with full-time and contractual employment.

Hiring in the Dominican Republic

he employer can float out an advertisement for hiring and interview the candidates. The work starts from the probation period which gets transferred to full-time service.

Labor Law and other ministerial decisions govern hiring in the Dominican Republic. The majority of laws favor Dominican Republic nationals over other nationalities. When hiring from outside the Dominican Republic, you must ensure that the candidates are worthy of the job and that no unemployed citizens can replace them. The foreigners applying for the job must have appropriate qualifications and professional competence to fill in the position.

Putting together written employment contracts and offer letters is among the most important initial steps of this employment relationship. It requires you to think about local employment laws, statutory demands, and country-specific standards.

Duties and Rights of the Employer in the Remote Working System

• Employers can choose the working hours for remote working employees.
• Employers hold the right to abolish the remote working system at any point in time if the employee breaks the rules and regulations.
• Employers are required to hire competent employees who are qualified to take up the job remotely.
• Employers are required to specify whether a particular job opening is suitable for remote working.
• Employers are required to give fair treatment to both remote working and in-office employees.
• Employers are required to provide any necessary tools and systems to employees to ensure ease in remote working.

Probation & Termination

There is a three-month probation period in which the employer can train and analyze the employee's performance. During the probation period, the employer or employee can terminate the contract without the necessity of any notice period. However, it is expected to give a 24-hour notice to the terminating party.

Termination of Service

The termination of service can happen with a notice period, as demonstrated below. For 'at will termination', the terminating party needs to give a notice period as below. For without cause termination, there needs to be severance pay given to the employee. The severance pay ranges from 6 days to 23 days salary based on the time employed.

EOR Solution in the Dominican Republic

Business expansion is a long-drawn process that calls for extensive planning, especially when expanding to a foreign country. It is complicated and can take up to several months to complete but by choosing the EOR route for hiring employees in the Dominican Republic, you can fast-track the expansion process. Employer of Record Dominican Republic (EOR) solutions by Skuad can make expansion to the Dominican Republic much simpler and a lot quicker for business. Our global outreach and a tech-enriched HR platform ensure compliance with local labor laws by managing employment responsibilities such as monthly payroll, work permits, employment contracts as well as taxation for your employees in the Dominican Republic. Book a demo with Skuad.

Outsourcing Employment Through an Employer of Record

Outsourcing is one of the easiest ways to enter the Dominican Republic market and get started with your business. Through an EOR you can legally hire employees in this country where all the hiring and payroll processes would be taken care of by professional EOR providers. You will give the guidance and the instruction of running the business which will be diligently carried by the local employees through your local EOR solution. Book a demo with Skuad today.

Types of Visas in the Dominican Republic

The process of fulfilling missions and moving employees from one nation to another is typically expensive, time-consuming, and complex. We'll support you through each phase of the visa process, from preparation and initiation to post-visa works. We'll also support the employee on the floor with workplace, office, and car leasing in addition to cultural and local language coaching.

Work Permits

You need to follow some processes to get your work permit in the Dominican Republic.

Payrolls & Taxation

Running international payroll requires you to ensure that payroll deductions and taxation are locally compliant, which is hard even for a single nation and just grows in complexity in the countries you expand to. Employees have to be paid on time and in the appropriate currency. An EOR takes in your payroll tasks.

Following taxes are levied on personal and businesses:

Employer Taxation

Employee Taxation

You can entrust Skuad with payroll & taxation management in the Dominican Republic. Book a demo to know more.

Bonuses

Bonuses are frequent throughout the Christmas season, and are usually paid around December 20th and are equivalent to an extra month's wage. They are exempt from paying taxes.

A profit-sharing bonus of 10% of the company's net income is also available to employees. Those with less than three years of service are entitled to 45 days of pay, while those with more than three years are eligible for 60 days.

Incorporation: How to Set Up a Subsidiary in the Dominican Republic

You can establish a limited liability company (LLC) or Sociedad de Responsabilidad Limitada (S.R.L.) in the Dominican Republic. Alternatively, you can establish a simple limited company, a public limited company, a branch, or a representative office.

The steps of incorporating a subsidiary in the Dominican Republic are as follows:

• You need to file a registration request with the Dominican Trademark Office to obtain a trading name for your company
• You need to draft by-laws and other incorporation documents
• You need to pay 1% incorporation taxes on the company’s registered capital
• You need to prepare a business registration application and file it with your company incorporation documents
• You need to file a request for a Tax Identification Number.

You can rely on Skuad to handle your expansion needs. Speak to our experts to know more about incorporating a subsidiary in the Dominican Republic.

PEO

A professional employer organization (PEO) collaborates with medium- and small-sized organizations to provide HR services. A PEO handles various HR services such as recruitment, payroll, training, and other HR tasks. An EOR also provides similar HR services; however, the difference lies in the arrangement or association between the outsourcing company and the business.

A PEO acts as your co-employer, whereas an EOR service acts as the legal employer of your employees. The latter assumes all the responsibilities and liabilities of your remote team. You can outsource a specific HR function or end-to-end activities.

Further, an EOR service allows you to expand your workforce without setting up a business entity. It handles payroll funding, worker’s compensation, and unemployment claims and reports. It files taxes under its file ID number.

Skuad's EOR solution is a good way to expand your business in the Dominican Republic without setting up a separate entity. Our solutions help you to stay focused on your business and leave all business compliances, payroll processing, and complete management work to us. Connect with Skuad to know more.

Conclusion

Expanding into the Dominican Republic is a fantastic choice for your business as it is one of the fastest-growing economies in the world. Skuad EOR is the perfect solution for your organization’s expansion plans. It works as a unified employment platform with automated workflows, digital signatures, employee payroll, contractor payout, and all types of compliance solutions. Book a demo with Skuad.

FAQs

1) What is an employer of record in the Dominican Republic?

In the Dominican Republic, an Employer of Record (EOR), like Skuad, is a service provider that legally hires and manages employees on behalf of another company. This includes handling all compliance, payroll, taxes, and employment benefits, allowing businesses to operate without establishing a physical presence in the country.

2) What are the benefits of using an employer of record in the Dominican Republic?

Using an EOR in the Dominican Republic offers several benefits including fast market entry, compliance with local labor laws, and administrative ease. Companies can focus on their core business activities without worrying about local employment regulations and payroll management complexities.

3) How much does it cost to use an EOR in the Dominican Republic?

The cost of using an EOR in the Dominican Republic can vary, but it typically ranges from 10% to 20% of the employee's salary. This fee covers the comprehensive management of HR tasks such as payroll processing, tax filings, and benefits administration. For more insights, try Skuad’s cost calculator now.

4) What is the notice period in the Dominican Republic?

The notice period in the Dominican Republic varies depending on the duration of employment. For employees who have worked less than one year, the notice period is 7 days. For those employed from one to five years, it extends to 14 days. For employees with more than five years of service, a notice period of 28 days is required.