Hire employees in Panama, hassle-free

With Deel, your business can easily hire employees in Panama. No more worrying about local laws, complex tax systems, or managing international payroll. Deel takes care of everything in 150+ countries.

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Employee - Panama

Hire employees in Panama No entity needed.

Usually, to hire in Panama,  your business needs an entity. That means a local office, an address registered as a subsidiary, and an account with a local bank. All of this, plus navigating regional benefits, payroll, tax, and HR laws, can take months. 

Panama also treats contractors differently than full-time employees, so misclassifying a contractor could lead to fines. Deel lets you hire employees in Panama quickly, easily, and compliantly. We even automate tax document collection, payroll, benefits, and more.

All the necessary benefits for Panama built right in

Deel allows you to provide localized benefits for employees in Panama within minutes. All in one manageable online dashboard.

  • Educational Scheme
  • Worker Compensation Insurance
  • 13th Salary
  • Work from Home Allowance


    Speak to our team about how to compliantly hire in Panama

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    Quick Overview

    Currency: United States Dollar (USD)

    Capital: Panama City

    Official language: Spanish

    Payroll Cycle: Bi-Monthly

    Statutory Holidays

    Paid Time Off

    In Panama, employees are entitled to 30 calendar days of paid holiday after 11 months of employment.

    Public Holidays

    • New Year’s day
    • Independence Day from Spain
    • Martyrs' Day
    • Carnival
    • Good Friday
    • Labor Day
    • Separation Day from Colombia
    • Colón Day
    • Uprising of Los Santos
    • Mother's Day
    • Christmas Day

    General Taxation

    Individual Income Tax

    The individual income tax depends on many variables, such as marital status, level of income, etc. The average ranges up to 25%

    Employer Cost

    Approximately, 36% of employee salary

    Additional information

    Employment Contract Details

    Employment contracts must be in writing in official language and can be bilingual. The contract should contain salary, position, responsibilities, the type of contract and bonuses if applicable.

    Probation Period

    The maximum probation period is 3 months. Probation period is not mandatory.

    Minimum Wage Requirements

    The minimum wage will depend on the sector of the company. For Deel the minimum monthly wage is USD 611.52

    Maximum working hours and overtime

    The maximum working hours permitted during a week is 48 hours, from Monday to Saturday. Standard is from 8am to 5pm with 1 hour for lunch time.

    Parental Leave

    • Maternity Leave: employees are entitled to 14 weeks of paid maternity leave, it can start 6 weeks before childbirth. However, if delivery date is delayed, then the prenatal portion of the leave is extended so the employee has 8 weeks of post-natal leave.
    • Paternity Leave: employees are entitled to 3 days of paid leave.

    Sick Leave

    Employees are entitled to 18 days' paid sick leave.

    Termination requirements for employees in

    Written dismissal must be provided stating cause and termination date. Employers are not required to pay severance unless termination is due to redundancy. If so, payment is determined based on the length of the labor relationship, it ranges from:

    • Up 6 months of employment - 2 weeks’ wages
    • Up to 20 years of employment - 15 months' wages

    Notice Period

    Notice is not required for employees terminated due to justifiable cause. Employees are entitled to 30 days’ notice is they are dismissed without reasonable cause.

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    5 Stars

    Deel is the best!!

    “Deel is an amazing platform! It's super intuitive and user friendly, plus it runs suuuuper smoothly!! It has great options for paying and withdrawing money, plus it helps you keep super organized with your spending. They also have great support and are super friendly with all the questions you might have :D I would definitely recommend it!!”

    Manuela Echeverry
    Nov 20, 2020
    5 Stars

    A contracting life-changer!

    "This has by far the singular tool that made my contracting work amazing. It used to be that contract management and payouts was a nightmare — Deel makes everything so easy especially with its Transferwise integration. Everyone gets paid on time and kept happy. I also contacted their support a couple of times for some small questions and they’ve been nothing short of amazing. If you’re a contractor or someone who hires contractors then definitely give Deel a go."

    Kix Panganiban
    Dec 3, 2020
    5 Stars

    Great service offering!!

    "The Deel platform has been super effective for my team and I and has enabled us to bring on workers globally. The platform allows us to onboard individuals seamlessly and with no issues at all. Highly recommend."

    Michael US
    Oct 28, 2020
    5 Stars

    Terrific service

    "Great service, amazing customer care, terrific platform, both for the company and for the contractors/employees. Saving everyone's time and money"

    Nunzio Martinello
    Dec 15, 2020
    5 Stars

    Deel is a game-changer for distributed teams

    "Deel has been instrumental in helping us both open and operate our EU operations. It's super simple to set up and implement and the support team has been world-class. I can't recommend them enough!"

    Jeremie Habib
    Nov 16, 2020
    5 Stars

    Great app with great customer service

    "Great app with great customer service, with great attention to details and legal requirements. Looking forward to keep using it!"

    Felipe Marote
    Jan 29, 2021