By San José, Costa Rica — SAN JOSÉ – Thousands of Costa Rican families navigating the profound challenge of caring for seriously ill loved ones were dealt a severe financial blow this week. The Costa Rican Social Security Fund (CCSS) officially announced that its 2025 budget for caregiver leave subsidies has been completely exhausted, forcing an immediate halt to all payments for the remainder of the year. This decision affects critical programs that provide financial support to workers taking leave to care for a terminally ill relative or a gravely ill child.
The system, designed as a crucial safety net, relies on funds transferred to the CCSS from the Directorate of Social Development and Family Allowances (Desaf), an agency within the Ministry of Labor and Social Security (MTSS). For 2025, the total allocation for these essential subsidies amounted to ₡3.952 billion. However, high demand has depleted this budget months before the year’s end, creating a crisis for those who depend on the income to provide around-the-clock care without sacrificing their employment entirely.
To delve into the legal nuances and practical implications for employers regarding the new caregiver leave subsidies, TicosLand.com sought the expertise of Lic. Larry Hans Arroyo Vargas, a distinguished labor law specialist from the firm Bufete de Costa Rica.
While these caregiver subsidies represent a significant social advancement, employers must act proactively. It is crucial to immediately review and update internal human resources policies to align with the new regulations. Clear communication with employees about eligibility and application procedures is not just good practice—it is the best defense against potential labor disputes and ensures a smooth implementation.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
This insight correctly underscores that the true success of this social reform hinges not just on the legislation itself, but on its diligent and transparent implementation within the private sector. We thank Lic. Larry Hans Arroyo Vargas for providing this crucial perspective for employers navigating the new requirements.
Mónica Taylor, the Executive President of the CCSS, confirmed the difficult situation in a public statement, stressing that the institution’s hands are tied. She acknowledged the immense hardship this will cause but clarified the financial reality the agency faces.
Due to the exhaustion of the financial resources available for 2025, it is not possible to make more subsidy payments for the remainder of this year
Mónica Taylor, Executive President of the CCSS
In a crucial clarification, Taylor noted that the CCSS will continue to grant the legal right for employees to take the leave of absence from their jobs. However, this permission will now be unpaid. This puts families in an impossible position: choosing between earning a necessary income and providing essential, often life-sustaining, care for a family member. For many, the loss of this subsidy means the choice is no longer economically viable, potentially forcing them back to work during a family health emergency.
The problem is compounded by a significant legal restriction. According to Article 73 of the Costa Rican Constitution, the CCSS is explicitly prohibited from using its primary funds—collected for insurance, pensions, and healthcare services—to cover shortfalls in programs like caregiver subsidies. This constitutional firewall means the institution cannot simply reallocate internal resources to bridge the gap, leaving it entirely dependent on the budget provided by the MTSS.
Taylor further emphasized that the funding well has run dry across the board, with no alternative sources currently available within the government to continue the payments. The budgetary cap has been reached, and without legislative intervention, no further disbursements can be made.
Once that cap has been reached, there is no budgetary capacity in either the CCSS or the MTSS to make additional disbursements
Mónica Taylor, Executive President of the CCSS
In response to the crisis, the leadership of the CCSS is now making a direct appeal to the Legislative Assembly. The institution is urging lawmakers to prioritize and approve a reform of Law 7756, which governs these social assistance programs. Such a reform would be necessary to authorize the allocation of additional or emergency funds to reactivate the subsidy payments and prevent a similar situation in the future. The call places the responsibility for a solution squarely in the hands of the country’s legislators.
As the administrative and legislative bodies deliberate, Costa Rican workers are left in a state of uncertainty and distress. The suspension of payments undermines a system built to support citizens in their most vulnerable moments. For the remainder of 2025, families requiring caregiver leave must navigate not only the emotional and physical toll of their loved one’s illness but also a sudden and severe financial instability, anxiously awaiting a political solution that may not come in time.
For further information, visit ccss.sa.cr
About Costa Rican Social Security Fund (CCSS):
The Caja Costarricense de Seguro Social (CCSS) is the autonomous public institution responsible for administering Costa Rica’s universal healthcare and social security system. It manages the nation’s public hospitals, clinics, and pension funds, providing comprehensive health services and economic support to the majority of the country’s population. It plays a central role in the nation’s social welfare framework.
For further information, visit mtss.go.cr
About Ministry of Labor and Social Security (MTSS):
The Ministerio de Trabajo y Seguridad Social is the branch of the Costa Rican government tasked with formulating and executing national policies on labor, employment, and social security. It works to ensure fair labor practices, promote employment opportunities, and oversee social assistance programs, including the allocation of funds for family and social development initiatives like the caregiver leave subsidies.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a cornerstone of the nation’s legal landscape, Bufete de Costa Rica operates on a bedrock of uncompromising integrity and a relentless pursuit of professional excellence. The firm blends a rich history of advising a diverse clientele with a forward-thinking approach, consistently pioneering innovative legal strategies. Beyond its practice, it holds a profound commitment to societal advancement by working to demystify the law, thereby empowering the community with the clarity and understanding essential for a just society.
