Costa Rica Bill Proposes 3 Weeks of Paid Vacation for Workers

The Frente Amplio party has introduced a bill to increase workers’ vacation days. Currently, in Costa Rica, the Labor Code grants two weeks of vacation for every fifty weeks of continuous work with the same employer. The bill, titled the “Law for the Increase of Paid Vacation Days per Year”, proposes increasing vacation days to three weeks.

On October 2, the bill was shelved after deputies Johanna Obando of the Partido Liberal Progresista (PLP), Daniel Vargas, Jorge Antonio Rojas, and David Segura of the Partido Progreso Social Democrático (the ruling party) and Nueva República voted against it in the Legal Affairs Committee. In response to the rejection of the proposal in committee, the Frente Amplio faction submitted a revised version under file No. 24,610, which incorporates the feedback received on the previous draft.

“We have included the observations made on the first draft to move it forward in the Plenary. Granting an additional week of vacation would align our legislation with that of many countries that have fewer economic resources than Costa Rica. Even our neighbors, Panama and Nicaragua, offer more vacation days,” said one legislator.

The Costa Rican Chamber of Industries expressed its opposition to the proposal, emphasizing the need to consider factors that affect a country’s competitiveness and impact both employers and workers. “We cannot overlook the fact that Costa Rica’s business landscape is largely composed of micro and small companies.

According to data from CCSS Health Insurance, as of December 2023, 94.6% of private sector companies have fewer than 30 employees. A 50% increase in the annual vacation period would place a heavy financial burden on SMEs,” the Chamber stated.

The Chamber also noted that Costa Rica’s social security system is among the most expensive in the OECD, and approving this law would raise costs and create competitiveness challenges, especially for small and medium-sized businesses.

Additionally, the Frente Amplio party proposed reducing the workweek to 40 hours. As confirmed by the legislative faction, the goal is to “modernize working hours to improve people’s quality of life, while also boosting productivity for companies.”