Approval of legislative Decree No. 519 increasing fines for labor non-compliance in El Salvador

By: Carlos Rodríguez

On October 4 of this year, the Legislative Assembly enacted Legislative Decree 519, which amends Art. 627 of the Labor Code, in order to substantially increase the fines for labor noncompliance.

The fines for non-compliance that did not have an express sanction, which are the great majority, had a sanction of up to 500 colones (i.e. $57.14) for each infraction.

With this reform, the penalty for each labor benefit that has been violated will be up to 12 minimum wages for the industry, commerce and services sector, depending on the number of employees:

1. Micro enterprises with up to 10 employees, a fine of up to 2 minimum wages per benefit violated.

2. Small companies with more than 10 to 50 employees, a fine of up to 4 minimum wages for each benefit violated.

Medium-sized companies, with more than 50 and up to 100 workers, a fine of up to 8 minimum wages for each benefit violated.

Companies with more than 100 employees, a fine of up to 12 minimum wages for each benefit violated.

3. The fines are individual for each infraction and to determine the exact amount of each sanction, the economic capacity of the offender and the size of the company, the seriousness of the infraction, the intentionality and the damage caused will be taken into account.

It is also important to take into account the following aspects:

a) The labor infractions to which the reform will apply, are those that do not have an express sanction, which are the great majority; however, infractions in Occupational Safety and Health, and other specific labor infractions that already have an express sanction in labor laws, this reform does not apply to them.

b) With this reform, fines are increased, but the procedure by which they are imposed is not reformed; that is to say, in order to impose fines, inspections must be carried out and in case violations are found, a term of no more than 15 working days will be allowed for their compliance and in case a re-inspection is carried out and the violation is not corrected, the respective sanctioning procedure will be initiated.

c) The Reform Decree will become effective 8 days after its publication in the Official Gazette. It has not yet been published, so we will follow up and keep you informed.

d) The reform will apply to infractions detected in inspections carried out on a date when the reform is already in force. For inspections performed previously, fines of up to $57.14 will apply.

For further information on the legal application of the above mentioned decree, please contact us at