Takeaways

• The Puerto Rico Christmas Bonus is a local tradition that comes with significant statutory requirements for employers.
• There are two tiers of employee eligibility and bonus amount depending on employee hire date and employer headcount.
• Employer profitability-related exemptions may apply, as do penalties of various percentages for failure to timely pay the Christmas Bonus.

Article

As coquito season nears, Puerto Rico employers must remember another local tradition: Paying the Christmas Bonus.

Under P.R. Law No. 148 of June 30, 1969, eligible (including former) employees must receive this statutory annual bonus between Nov. 15 and Dec. 15 of any calendar year. Failure to pay the bonus in a timely manner results in a 50 percent penalty if payment is made within six months of the due date; or 100 percent penalty if payment is made thereafter.

Employee Eligibility + Bonus Formulas

The eligibility requirements and bonus formula will depend on the employee’s hire date and the employer’s headcount. Legislation enacted in 2017 changed the eligibility threshold but grandfathered existing employees into the previous requirements and formula while they work for the same employer.

Employers must therefore account for the following two employee groups:

1. Employees Hired Before Jan. 26, 2017

An employee who works at least 700 hours between Oct. 1 of any calendar year and Sept. 30 of the subsequent calendar year is entitled to the Christmas Bonus. For employers with up to 15...

Read Full Story: https://news.google.com/rss/articles/CBMirAFBVV95cUxOT1B0U1RrRVhScG9GZUxNbG1W...