In our last edition we talked about the special conditions of the Housemaid labor contract and all the benefits and important conditions of this special contract that is important to know when you contract, but know it is also important to know about the normal contracts and the consequences of termination. This consequences will depend on certain acts or attitudes of the contractor and the worker and depending of this, there will be money involved. The first thing you have to know is Who is a employee ?, what special characteristics established by law, determine who is and who is not a employee, The person you call your employee has to do the following A persons who gives you a service, material or intellectual He gives that services in virtue of a Work Contract This Contract can be verbal or written, individual or collective This person receives a salary for his work, he has a eight hour work day, and he is subordinated to your orders This is the person you can call your employee, he has to follow your rules and you have to follow the legislation in order to create this rules, both are protected by law in case of differences PROBLEMS WITH YOUR EMPLOYEE Costa Rica´s, Labor Law protects the indiscriminate dismissal of employees without a just case, this just case is establish by law and will determine if the worker is entitled to a compensation for his dismissal or he was fired and deserves no compensation, this because of his actions or work attitude JUST CASES TO FIRE AN EMPLOYEE They are established by the Labor Code, in its article 81, and they are the following When the workers conduct during his job is immoral, or he insults , slanders or hits his employer Its is difficult to determine exactly what is immoral, but we can go by the normal behavior of a person which will not do things that for the general public is not correct, this will depend on the case, and also its analysis When the workers conduct is the same mentioned above but against a work mate, in working time and that with his actions he disturbs work and efficiency in the job When the worker after working hours , and out of the work facilities, insults, slanders or hits his employer, or his representatives in the job, only if his actions where not provoked by them, and as a consequence of the event the daily living and working is impossible for the efficient development of work When the worker commits a crime or a grave damage to the property of the employer or when he intentionally causes a damage in the materials or the machinery, tools, raw materials, products and any other object related with no doubt to the job When the worker reveals the employer secrets of the products, techniques or commercial strategies When the worker, because of his inexcusable unwise conduct, puts in danger the security of the working area, or of the people inside When the worker does not come to work , without a permit from the employer, without a justification for two days consecutively or three days in a month When the worker denies in a reiterative mode, to adopt the preventive measures or the indicated procedures to prevent accidents or illness, or when he denies in the same way, the directives for efficiency issued by his employer, causing grave loss in the production or the services When the worker after been censured once for his actions according to items a,b,c,d,e he continues the same actions When the employee at the moment of making the work contract, lied pretending to have special qualifications for the job, knowledge, or present fake references that can be proved false, or that while performing his job it is obvious he does not have the capability to do it and for which he has been contracted When the worker is serving a sentence for a criminal act When he worker commits a grave fault to the obligations established in the contract The only thing you pay to dismiss a worked who fits any of the previously sited, is Vacations, pay one day for each month worked. Aguinaldo, add all the amount he has earned from the past December to the date and divided into 12, that will give you the amount to pay for aguinaldo If the worker is fired without one of the just cases sited above, he will be entitled to Vacations and Aguinaldo and the following “Pre-aviso”, this is a legal figure, that gives the worker the right to be indemnified, if the employer is letting him go without proper notice, this figure will work under the following conditions If the worker has less than 30 days working, you don’t have to give them previous notice If she or he has from 30 days to 6 months working, you have to give one week notice or the equivalent in cash If the worker is 6 months to 1 year in the job, you have to give 15 days notice or the equivalent in cash If the worker has over a year working for you, the previous notice is one month, or that same amount in cash For every week of “PRE-NOTICE” or “PREAVISO”, they have one extra day off to find a new job The term “Cesantía” is used to give the worker some laying off insurance money in case they don’t find a job in the period of time they are “PRE-NOTICE”, this amount will be paid by the contractor in the following way If the worker is less than 30 days old in the job she is not entitled to any amount If she or he has 30 days to six months, then the amount is the equivalent of ten days work If they’ve worked from 6 months to one year, they get paid 20 days work. From one year and on, 1 month of salary for each year worked until you reach 8 months This information is important, so you know what can be spected from a work relation with an employee, the basic information is provided here but you know that every individual case is different and might or might not fit in one of the above, any consultation about the concepts explained, I will be glad to answer just write to us and we will gladly help you.

Some people like the idea of a Marriage under the sun and in a private desert beach in Costa Rica, rather than their normal marriage license in their hometown before a Judge or Priest, so for those of you that have that idea I will explain how things work in Costa Rica. Marriages in Costa Rica is a little bit different than in the United States and Canada, there you ask for a Marriage License and then perform the rituals of marriage before a person who is authorized to do it or before a Priest works different; there is two types of marriages. CATOLIC MARRIAGE: The Catholic priest has the law given right to solemnize marriages. This type of marriage automatically becomes a civil marriage, because by law the catholic priest are also civil authorities to perform marriages. This responsibility is granted thru their inscription before the Civil Registry of their signature and official seal. Catholicism is the official religion of the Costa Rica Government by law, so one of the benefits Catholics get of this is that their Priests are able to perform marriages, all other religions are not authorized to perform marriages, they cannot be registered and will not have legal value CIVIL MARRIAGE: This one is performed by a Family Judge authorized by the court, or by a Notary Public, all the other religious denominations have to perform a civil marriage by a Notary Public or Judge, get it registered and then go back and have the religious ceremony, Lawyers that are also credited as Notary Publics and duly registered in the Civil Register and Judges are the only ones authorized to perform marriages, they have a special book for that, they keep a record of them and are the ones responsible for the registration of that marriage before the National Registry. ( Civil Registry keeps track of identification numbers for citizens, marriage records, birth records, and death records). In any of the cases the basic requirements are: Two witnesses, they have to be of legal age and be present a the moment of signature of the documents Certification from the national registry of your civil status ( In case of foreigners they sign at affidavit, stating that there is no previous marriages. In the case of the Catholic Church they require a pre-marital course, and that the persons to be married are Catholic, also that the witnesses have to be Catholic, and the Religious ceremony has the validity of the Civil Marriage. After this requirements it normally takes the lawyer or priest involved about a month to inscribe your documentation in the National Registry Divorce is a lot different than in the United States, Canada and most countries, because if you want to divorce by mutual agreement or irreconcilable differences and there is no dispute there are several things to think about first The first requirement is to have your marriage is at least 3 years old, if it is not then sorry but the law does not allow negotiated divorces to happen before the marriage is that old Any of the other causes of divorce can be started at any time, but in those cases there will be litigation involve, physical or sociological damage or unsustainable situations The causes to get a divorce if it is not by common agreement are: Adultery Attemp to murder the spouse or any of the children Prostitution of the spouse or any of the children Cruel treatment Legal separation for at least one year The absences of the spouse legally declared Separation for at least three years If your situation does not fit in one of those, you can’t get divorced, also the average amount of time to get a divorce in court would be of at least two years, so maybe is better to talk to your ex and get a divorce by mutual agreement that would take only three months Also important in a divorce situation The real estate and other assets purchased or obtained by any other mean, by any of the two parties during the time they were married are to be divided in halves If you have been awarded an inheritance this is the only thing that its not subject to be divided, it is only yours. The party that provides the income to the family has to provide alimony to the one that has no income until he or she gets a way to earn a living If you have children, the Patronato (Government Institution that is en charged of supervising minors in Costa Rica), is going to be a party in your divorce, children get child support until they are 18 years old, or 25 if they are studying Normally the women will be granted with the custody fort he children, that is almost fact, the only way to change that is to demonstrate that the women will not provided a safe environment for the children to grow in, but, prove it Please be advise that this information is a general idea of the situation and that in any particular case there is always differences and situations that might change some of the facts, and might not fit exactly in the general rule, so always consult your counselor for a professional advise, it is important to obtain certainty when you are thinking in the way you are going to live in the future, and also to avoid inconveniences that might show up when acting without proper professional advise.

I´ve had many inquires about the use of having a corporation in Costa Rica, and I would like to explain the ways of having a corporation and its benefits: The name for them is Anonymous Societies, because the stockholders are never mentioned anywhere, only in the first document or Constitution the Notary Public takes note of the parties that make the Society and that are the stockholders initially, and after that the National Registry does not take note of that and they are never mentioned again, unless they want to be. The stocks in a Anonymous Society are transferable with only the stockholder signature in the back and can change hands as many times necessary, They are presented in the annual meeting so the board of directors can take note of the presence of the stock and its holder. The Commerce Code of Costa Rica, which is a copy of the Mexican Commerce Code which is also a copy of the Spanish Commerce Code had the original intention of making possible the trip to the new found lands of America at the beginning and kept that idea thru time. This gave the explorers a Legal instrument to finance their expeditions and at the same time, it gave the investors, security in their investment because they owed a percentage of the corporation that made the trip and so, the same percentage of the benefits of it. The Corporation in this sense is a legal individual, who represents the interests of its stockholders, it was important to be able to claim a piece of the new riches found in the new found lands once the trip was finished Thru time the idea of the Anonymous Society has change very little, so the legislation is intended in that type of Entity, a big Corporation with allot of stockholders who start a new business or service and who initially is financed by the stock holders and then when the business is running they get back their percentage of the earnings. But times have changed and we lawyers have found new uses for the legal figure of the Corporation, it is still intended for the initiation of a business that would generate income but there is also another use for it. The corporation can be used to hold your assets in Costa Rica, and it can become a good way to limit your liability in a personal responsibility situation you may encounter. If your idea is to buy a house or real state in Costa Rica, it would be recommendable to do it thru a corporation so that those properties stay away and safe from your personal responsibilities. To constitute a corporation you require: At least two persons, because a Society means at least two An amount of capital to give economical ground to the corporation ( who much would stocks cost and how many stocks shod be made A board of directors that is made up of a President, Secretary a Treasurer at least A fiscal who has the obligation of vigilance of the Corporation activities A Resident Agent, that normally is the Notary Public who constitutes the Corporation, who will the responsible of receiving judicial and extra judicial notifications for the Corporation. A legal representative for the Corporation that is normally the President of the Board of director or him and the Secretary acting together It has to be specified if the power of attorney given to the Representative, has limitations or is as the Spanish legal term says GENERALISIMO SIN LIMITE DE SUMA, that means he can buy sell and in any way decide of the assets of the corporation. The corporation has a set of six legal books in which the changes in it are made, the inventory, the stockholder registry, the general assemblies and the board of directors assemblies are kept, also a book that states the annual balances of the fiscal year (In Costa Rica from October 1 to September 31 of every year). You may change the board of directors, the powers they have and all the possible agreements necessary for the corporations to operate Many corporations never even use their books, because they never have commercial activity and its board of directors never changed, This is the case when the corporation is used only to hold real state or vehicles, never makes any type of business and stays away from trouble, and it actually can because, different from a fisical person, a juridical person never has the possibility of having liability for accidents or criminal activities, but there is always an exemption to the rule Vehicle accidents, the corporation will be responsible for the damage caused by the accident, and if the car is not well insured or the deductibles are not paid the other assets can be foreclosed to pay for the amounts pending, so have a good insurance in your vehicles or keep cars and real state in separate corporations If your corporation has an employee it would be responsible for the work benefits and accidents of its employees, as well as of following the regulations on work risk insurance and social security. In case of mortgage to the real state of the corporation, if the property given in mortgage does not cover all the expenses of the foreclosure, the other real state registered on the same corporation would be liable for the amount pending after final foreclosure It is very important to have control over the board of directors so you never loose sight of the real state that is in the name of the corporation, also to keep the stocks and legal books in a safe place, always have a lawyer and a good accountant to keep the corporation up to date with all its requirements.

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