Peru is quickly becoming a leading destination for companies looking to hire in Peru and expand their remote teams with access to a skilled talent pool in Latin America. Known for its dynamic economy, diverse workforce, and growing infrastructure, Peru offers significant advantages for businesses seeking to hire and operate in the region.
This guide will walk you through everything you need to know when you hire in Peru. From understanding different hiring methods and navigating labor laws to setting up a business entity for direct hiring, this comprehensive guide covers the essential aspects of recruitment, payroll, taxes, and compliance when you hire in Peru. Whether you’re a startup hiring your first Peruvian contractor or a growing company establishing a local entity, this guide will help you navigate the Peruvian market efficiently and compliantly.
Key Stats About Hiring in Peru
Language: Spanish (English proficiency is growing, particularly in the business and tech sectors)
Time Zone: GMT-5 (similar to Eastern Standard Time, with no Daylight Saving Time)
Currency: Peruvian Sol (PEN)
Population: Approximately 33 million
Major Cities for Talent: Lima, Arequipa, Trujillo
Internet Penetration: Over 60%, with reliable high-speed internet in urban areas
Labor Force: Approximately 17 million, with a strong focus on tech, finance, and services
Education: High literacy rate (94%) with approximately 20,000 STEM graduates annually
Why Hire in Peru?
Peru has become one of Latin America’s most promising markets when you hire in Peru for skilled professionals. Here’s why it stands out as an ideal location for businesses seeking remote talent:
Government Incentives
Peru’s government actively supports foreign investment through free trade agreements, tax benefits, and simplified regulatory frameworks for companies that hire in Peru. Programs like Peru StartUp foster innovation and entrepreneurship, attracting skilled professionals ready to work with international companies.
Skilled Workforce
With a labor force of over 17 million, when you hire in Peru you gain access to a diverse and highly educated talent pool. Cities like Lima, Arequipa, and Trujillo are known for their universities and professional ecosystems, providing access to professionals in technology, engineering, finance, and customer service.
Growing Economy
Peru has one of the fastest-growing economies in Latin America, with a GDP of $262 billion in 2026. A stable macroeconomic environment and a strong focus on foreign investment make it an attractive market for international businesses that hire in Peru.
Cultural Compatibility
Peruvians exhibit a work culture that aligns well with North American and European standards, emphasizing collaboration, punctuality, and adaptability when you hire in Peru. Additionally, Peru’s GMT-5 time zone enables seamless communication with U.S.-based teams, facilitating real-time collaboration.
Cost-Effective Talent
Companies that hire in Peru benefit from competitive salary ranges that are 50-65% lower than comparable positions in North America, while still accessing highly qualified professionals.
3 Ways to Hire in Peru
When it comes to hiring talent and deciding how to hire in Peru, businesses have three main options: engaging contractors, utilizing Employer of Record (EOR) services, or forming a local legal entity.
1. Hiring Contractors in Peru
Hiring contractors when you hire in Peru is often the simplest way to quickly onboard talent for short-term or project-based work. Contractors operate as self-employed individuals and handle their own taxes and benefits.
PROS
- Flexibility: Suitable for short-term projects or roles with fluctuating workloads
- Cost-Effective: No requirement to provide benefits such as health insurance, pensions, or paid leave
- Simplicity: Minimal paperwork with no need to set up a legal entity
CONS
- Compliance Risks: Misclassifying employees as contractors can lead to financial and legal penalties
- Limited Control: Less oversight and control compared to full-time employees
- Talent Attraction: Top candidates may prefer the stability and benefits of full-time employment
Key Considerations: Clearly define the scope of work, deliverables, and payment terms in a contractor agreement when you hire in Peru. Ensure compliance with Peruvian laws that distinguish contractors from employees to avoid misclassification risks.
2. Employer of Record (EOR) Services to Hire in Peru
An Employer of Record (EOR) serves as the legal employer of your Peruvian staff, managing payroll, taxes, benefits, and compliance. This allows businesses to hire in Peru with full-time employees without the need to establish a local legal entity.
PROS
- Compliance: Ensures adherence to local labor laws, benefits, and tax regulations
- Quick Onboarding: Speeds up hiring without navigating Peru’s administrative complexities
- Reduced Administrative Burden: Payroll, HR, and benefits are managed by the EOR
CONS
- Service Costs: EOR services charge a monthly fee per employee, adding to operational expenses
- Indirect Control: Certain employment decisions must go through the EOR
Key Considerations: EOR services are ideal for companies exploring the Peruvian market or looking to hire in Peru with small teams. They offer a compliant and flexible solution for hiring full-time talent.
3. Entity Formation When You Hire in Peru
Setting up a local legal entity in Peru allows businesses to hire in Peru directly with employees and manage their operations independently. This option is best suited for companies planning long-term investments and larger workforce expansion.
PROS
- Full Control: Directly oversee hiring, payroll, benefits, and operations
- Market Presence: Establish a stronger local brand and long-term footprint in Peru
- Long-Term Strategy: Ideal for businesses scaling operations and building large teams
CONS
- Time-Consuming: The process of incorporation involves significant time and paperwork
- Higher Costs: Upfront costs for registration, legal fees, and ongoing compliance
- Regulatory Complexity: Requires navigating Peru’s legal and tax environment
Key Considerations: Setting up an entity when you hire in Peru requires registering with Peru’s Public Registry (SUNARP), obtaining a tax identification number (RUC), and complying with labor and tax obligations. This option is most suitable for businesses with long-term growth strategies in Peru.
Labor Laws and Employment Contracts When You Hire in Peru
Understanding Peru’s labor laws is essential to ensure compliance and maintain a positive employer-employee relationship when you hire in Peru. This section outlines the main types of employment contracts and the key labor regulations.
Types of Employment Contracts
Peruvian labor law recognizes several types of employment contracts:
Indefinite-Term Contract: The default contract type for permanent roles with no defined end date. This provides stability for long-term hires.
Fixed-Term Contract: Designed for temporary or project-based roles, with a maximum duration of five years. After this, the contract may convert to indefinite-term.
Part-Time Contract: Suitable for employees working fewer than 24 hours per week. Benefits are provided on a proportional basis.
Key Considerations: All employment contracts must be in writing and clearly outline job duties, salary, benefits, working hours, and termination conditions when you hire in Peru. Fixed-term contracts require a defined end date and justification for temporary employment.
Employee Rights and Benefits
Peruvian labor law guarantees employees several rights and mandatory benefits that employers who hire in Peru must provide:
Working Hours
- The standard workweek is 48 hours, typically spread over six days
- Overtime is paid at a rate of 1.25 to 2 times the regular hourly rate, depending on the day and time
Paid Leave
- Annual Vacation: 30 calendar days of paid vacation annually after completing one year of service
- Public Holidays: Peru recognizes 12 public holidays, which are observed as paid days off
Public Holidays in Peru
- January 1 – New Year’s Day (Año Nuevo)
- April – Holy Thursday (Jueves Santo)
- April – Good Friday (Viernes Santo)
- May 1 – Labor Day (Día del Trabajador)
- June 29 – Saint Peter and Saint Paul (San Pedro y San Pablo)
- July 28 – Independence Day (Día de la Independencia)
- July 29 – Independence Day Celebration (Celebración del Día de la Independencia)
- August 30 – Santa Rosa of Lima (Santa Rosa de Lima)
- October 8 – Battle of Angamos (Combate de Angamos)
- November 1 – All Saints’ Day (Día de Todos los Santos)
- December 8 – Immaculate Conception (Inmaculada Concepción)
- December 25 – Christmas Day (Navidad)
Maternity and Paternity Leave
Maternity Leave: Female employees are entitled to 14 weeks of paid maternity leave.
Paternity Leave: Fathers are entitled to 10 days of paid paternity leave.
Severance Pay
For termination without just cause, employees are entitled to one month’s salary per year of service, up to a maximum of 12 months.
Key Considerations: Adhering to these rights and benefits is critical for maintaining compliance and building trust with employees when you hire in Peru. Employment contracts should outline these terms clearly to avoid disputes.
Payroll, Benefits and Compensation When You Hire in Peru
Employers who hire in Peru must follow strict guidelines when managing payroll and compensating employees. Compliance with payroll structures, mandatory benefits, and contributions is essential to avoid legal issues.
Salary Structure
Base Salary: The minimum wage in Peru is 1,130 PEN (approximately $300 USD) per month as of 2026.
Bonuses: Mandatory July and December bonuses equal to one month’s salary each (gratificaciones).
Allowances: Employees earning below a specified threshold are entitled to a transportation or meal allowance.
Mandatory Benefits
Employers who hire in Peru must provide:
Health Insurance: Employers must contribute 9% of an employee’s monthly salary to the public health system (EsSalud).
Pension Contributions: Employees must contribute 10% of their salary to their pension plan, either through the public (ONP) or private (AFP) system.
Severance (CTS): Employers must deposit a severance amount equivalent to one month’s salary per year of service into a Compensation for Time of Service (CTS) account.
Payment Cycles
Monthly Payments: Salaries are typically paid monthly when you hire in Peru.
Deductions: Employers must withhold taxes and contributions for pensions, social security, and other mandatory deductions.
Key Considerations: Employers must ensure payroll compliance by calculating mandatory contributions, taxes, and bonuses accurately when they hire in Peru. Partnering with a local payroll provider can help simplify these processes.
Navigating Taxes and Legal Compliance to Hire in Peru
Understanding Peru’s tax and legal framework is vital for businesses that hire in Peru. Employers must comply with corporate and employment tax regulations to avoid penalties.
Corporate Taxes
Corporate Income Tax: The standard corporate income tax rate is 29.5%, applicable to taxable income.
Value-Added Tax (VAT): A 18% VAT is applied to the sale of goods and services, with specific exemptions for items like basic food products.
Employment Taxes and Withholdings
Income Tax Withholding: Employers who hire in Peru must withhold income tax from employees’ salaries based on progressive rates, ranging from 8% to 30%.
Social Security Contributions: Employers are responsible for contributing 9% of salaries to EsSalud.
Pension Contributions: Employees contribute 10% of their salary to their pension plan, deducted directly from their wages.
Key Considerations: Accurate calculations and timely remittance of these taxes and contributions are essential when you hire in Peru. Failure to comply can result in penalties and legal issues for the company.
Data Protection and Privacy Regulations
Peru’s Data Protection Law (Law 29733) governs the collection and processing of personal data. Employers who hire in Peru must:
Data Consent: Obtain explicit consent from employees before processing their personal information.
Data Security: Implement measures to protect employee data from unauthorized access or misuse.
Permitted Use: Use employee data only for purposes outlined in the consent form or employment contract.
Key Considerations: Businesses must maintain accurate records and ensure compliance with Peru’s tax and data protection laws when they hire in Peru. Collaborating with local legal and accounting experts can help manage these obligations effectively.
Company Formation and Setup to Hire in Peru
For businesses planning a long-term presence and wanting to hire in Peru, setting up a local entity is a critical step. Here’s what the process entails:
Types of Business Entities
Simplified Stock Company (S.A.C.): The most flexible and common structure for foreign investors when they hire in Peru. It allows limited liability and streamlined governance.
Limited Liability Company (S.R.L.): Requires at least two partners and is ideal for small businesses.
Public Corporation (S.A.): Suitable for larger companies, requiring stricter governance and reporting requirements.
Registration Process
- Choose a Business Name: Verify the availability of the name with Peru’s National Public Registry (SUNARP)
- Draft and Notarize Bylaws: Define the company’s purpose, governance, and operational rules
- Register with SUNARP: Submit incorporation documents to obtain a business registration number
- Obtain a Tax ID (RUC): Register with Peru’s National Tax Authority (SUNAT)
- Open a Corporate Bank Account: Required for conducting business transactions and payroll payments
Key Considerations: The process of establishing a legal entity in Peru can take several weeks when you hire in Peru. Partnering with local legal advisors ensures smooth navigation of the regulatory requirements.
Compliance and Management When You Hire in Peru
Ongoing compliance with local regulations is essential for businesses that hire in Peru. Key compliance areas include tax filings, payroll management, and social security contributions.
Annual Compliance Requirements
Tax Filings: Companies must file annual corporate income tax returns and monthly VAT declarations with SUNAT.
Financial Statements: Businesses are required to prepare and submit financial statements to the tax authority (SUNAT).
Social Security Contributions: Employers must remit social security and pension contributions monthly when they hire in Peru.
Working with Local Partners
To streamline operations and ensure compliance when you hire in Peru, many foreign companies collaborate with local partners:
Accounting Firms: Handle bookkeeping, tax filings, and financial reporting to ensure accuracy.
Legal Advisors: Provide support for employment contracts, compliance updates, and dispute resolution.
Payroll Providers: Manage salary payments, deductions, and contributions to streamline operations.
Key Considerations: Regular audits and collaboration with local experts can help ensure compliance and reduce the risk of penalties when you hire in Peru.
Leveraging Employer of Record (EOR) and Professional Employer Organization (PEO) Services to Hire in Peru
For companies seeking to hire in Peru without establishing a legal entity, EOR and PEO services offer a practical solution.
Employer of Record (EOR): The EOR acts as the legal employer, managing payroll, taxes, and benefits, while you retain operational control when you hire in Peru.
Professional Employer Organization (PEO): Similar to an EOR, a PEO handles HR, compliance, and payroll, allowing you to focus on day-to-day business activities.
Key Considerations: These services simplify hiring and ensure compliance, making them an ideal option for companies new to the Peruvian market when they hire in Peru.
Frequently Asked Questions About Hiring in Peru
How much does it cost to hire in Peru?
The cost to hire in Peru is competitive within Latin America. The minimum wage is 1,130 PEN (approximately $300 USD) per month as of 2025. Skilled professionals in technology, finance, and engineering typically earn between $800-$3,000 USD monthly depending on experience and specialization. Employers must budget for mandatory costs including 9% health insurance contributions (EsSalud), CTS (severance fund deposits), and two annual bonuses (July and December gratificaciones). Total employment costs when you hire in Peru are 50-65% lower than comparable North American positions.
What is the best way to hire employees in Peru?
The best way to hire in Peru depends on your business timeline and commitment level. For quick market entry without establishing a legal entity, using an Employer of Record (EOR) is ideal as they manage all compliance, payroll, and benefits within days. For project-based or short-term work, hiring independent contractors offers flexibility. If you’re planning long-term operations with multiple employees, establishing a local entity (S.A.C. is most flexible) provides full control. Most companies start with an EOR to test the Peruvian market before committing to entity formation.
Can I hire remote workers in Peru without a local entity?
Yes, you can hire in Peru without establishing a local entity by using an Employer of Record (EOR) service or hiring independent contractors. An EOR acts as the legal employer, managing all compliance including payroll, taxes, 9% health insurance contributions (EsSalud), CTS deposits, and mandatory July and December bonuses while you direct daily work activities. This allows you to compliantly hire full-time employees in Peru within 3-7 business days. Contractors manage their own taxes and benefits, though proper classification is critical to avoid misclassification penalties.
What are the labor laws I need to know when hiring in Peru?
When you hire in Peru, key labor laws include: a 48-hour standard workweek across six days, 30 calendar days of paid vacation annually after one year of service, 12 paid public holidays, 14 weeks of paid maternity leave, and 10 days of paternity leave. Employers must provide severance pay for termination without just cause (one month’s salary per year worked, up to 12 months maximum). Mandatory employer contributions include 9% to EsSalud, CTS deposits, and two annual bonuses (July and December). All contracts must be in writing with clear terms.
How long does it take to hire employees in Peru?
The timeline to hire in Peru varies by method. Using an Employer of Record (EOR), you can hire employees in as little as 3-7 business days once candidates are selected. Hiring contractors is even faster, typically 1-3 days after contract agreement. However, if you’re establishing a local entity first, the S.A.C. incorporation process takes approximately 6-10 weeks, including name registration through SUNARP, drafting and notarizing bylaws, obtaining a Tax ID (RUC) from SUNAT, and opening a corporate bank account. After entity setup, individual hiring proceeds within 1-2 weeks.
What is the minimum wage in Peru?
The minimum wage in Peru for 2025 is 1,130 PEN per month (approximately $300 USD), set by the government and adjusted periodically. However, skilled professionals in high-demand sectors like software development, engineering, financial analysis, digital marketing, and customer support typically earn significantly above minimum wage, ranging from $800-$3,000 USD monthly depending on experience, specialization, and language proficiency. Peru’s 20,000 annual STEM graduates and 94% literacy rate provide access to qualified talent at competitive regional rates.
Do I need to pay taxes when I hire in Peru?
Yes, when you hire in Peru, you must comply with several tax obligations. Employers contribute 9% of employee salaries to the public health system (EsSalud) and must make regular CTS (severance fund) deposits. You must also withhold income tax based on Peru’s progressive rates (8-30%) and remit it to SUNAT. Employees contribute 10% of their salary to pension plans (ONP or AFP), deducted from wages. Employers must pay two mandatory annual bonuses (July and December gratificaciones). If you establish a local entity, you’ll be subject to 29.5% corporate income tax and 18% VAT. An EOR handles all these obligations.
What are the benefits of hiring in Peru vs other Latin American countries?
Hiring in Peru offers several unique advantages over other Latin American countries. Peru has one of the fastest-growing economies in Latin America with GDP of $262 billion, providing economic stability. The GMT-5 time zone provides perfect alignment with U.S. Eastern time for real-time collaboration. Peru produces 20,000 STEM graduates annually with a 94% literacy rate, offering strong technical talent. Government support through free trade agreements, tax benefits, and programs like Peru StartUp make it attractive for foreign investment. Cost-effective salaries (50-65% lower than North America) combined with generous employee benefits (30 days vacation, strong labor protections) and cultural alignment with Western business practices make Peru an excellent nearshore destination.
Conclusion: Ready to Hire in Peru?
Peru offers a dynamic and growing environment for businesses seeking to hire in Peru with skilled talent in Latin America. With its diverse workforce of 17 million professionals, stable and fast-growing economy (GDP of $262 billion), and government incentives including free trade agreements and tax benefits, Peru is an excellent choice for remote teams and local operations.
Whether you opt to hire in Peru through contractors, use an EOR, or establish a local entity (S.A.C. being most flexible), this guide provides the foundation to navigate Peru’s labor market efficiently and compliantly. Understanding key requirements—including 9% EsSalud contributions, CTS deposits, mandatory July and December bonuses, 30 days annual vacation, and progressive income tax (8-30%)—ensures successful hiring practices.
Start your journey to hire in Peru today and unlock access to one of Latin America’s most promising and cost-effective talent markets, where you can build high-performing teams while reducing costs by 50-65% compared to North American hiring.