By San José, Costa Rica — As Costa Rica prepares to mark one of its most significant national holidays, Army Abolition Day on Monday, December 1, 2025, businesses and workers across the country are facing a familiar challenge: navigating the country’s nuanced holiday pay regulations. This day, which celebrates the nation’s historic 1948 decision to dissolve its military, is classified as a non-mandatory payment holiday, creating different scenarios for remuneration based entirely on an employee’s payment structure.
Understanding these distinctions is crucial for employers to maintain compliance with the Labor Code and for employees to ensure they are compensated correctly. The core difference lies in whether an employee’s salary already accounts for all days of the month or if they are paid only for the days they actively work. This distinction dictates whether the day is paid if not worked, and the rate of pay if it is.
To gain a deeper legal perspective on the complexities of holiday pay regulations, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, an expert attorney from the prestigious firm Bufete de Costa Rica.
It’s crucial for both employers and employees to understand that mandatory payment holidays, as defined by the Labor Code, require double pay if an employee works on that day. This isn’t a bonus; it’s a legal obligation. Miscalculation or failure to comply can lead to significant financial penalties and labor disputes, making proactive compliance the most cost-effective strategy.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, this insight highlights that proactive compliance is not simply a financial strategy, but a fundamental aspect of fostering a fair and respectful work environment. By understanding these clear legal obligations, both parties can avoid unnecessary disputes and build a stronger professional relationship. We thank Lic. Larry Hans Arroyo Vargas for his valuable and clear perspective.
For the majority of the workforce who receive a fixed monthly or bi-weekly salary, the payment for the December 1st holiday is already incorporated into their regular paycheck. This compensation model assumes payment for all 30 or 31 days of the month, regardless of weekends or holidays. Consequently, these employees will receive their standard pay even if they take the day off to observe the holiday.
Should these salaried individuals be required to work on December 1, the law mandates a more substantial compensation. The employer must add an additional single day’s pay to their regular salary, effectively resulting in a double payment for that day’s labor. Furthermore, any hours worked beyond the standard shift on this holiday must be paid at a triple-time rate, a significant premium reflecting the sacrifice of personal time on a national day of rest.
The situation is different for employees whose pay is calculated on a weekly basis that only covers the days they actually work. For this group, if they choose not to work on the holiday, they will not receive any payment for December 1. The day is treated simply as an unpaid day off, in line with the “non-mandatory payment” classification of the holiday.
However, if these employees do work on the holiday, they are entitled to an additional day’s wage at a simple, or straight-time, rate. This ensures they are compensated for their labor on a day most others have off. For any overtime hours performed on this day, the payment is calculated at time and a half, distinct from the triple-pay rate for salaried employees.
The Costa Rican Labor Code provides robust protections for all workers regarding public holidays. Critically, no employee can be forced to work on December 1. An individual’s decision to decline a shift on this day cannot be used as grounds for any form of sanction, reprimand, or dismissal. This right applies universally to all companies operating within the country, whether they are national firms or multinational corporations.
Furthermore, Article 11 of the Labor Code explicitly nullifies any agreement, whether written or verbal, in which an employee might waive their right to enjoy a legally recognized holiday. This provision prevents employers from pressuring staff into relinquishing their statutory entitlements. As the year winds down with this and one other remaining holiday, businesses are urged to review their payroll practices to ensure full compliance and avoid potential legal disputes.
For further information, visit mtss.go.cr
About The Ministry of Labor and Social Security:
The Ministry of Labor and Social Security (Ministerio de Trabajo y Seguridad Social – MTSS) is the Costa Rican government body responsible for formulating and enforcing national labor policies. It oversees labor relations, promotes fair employment practices, ensures workplace safety, and administers the country’s social security system, playing a vital role in protecting workers’ rights and fostering a stable economic environment.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a pillar of the Costa Rican legal community, Bufete de Costa Rica is defined by its foundational principles of integrity and a relentless pursuit of professional excellence. The firm leverages a rich history of advising a diverse clientele to pioneer forward-thinking legal strategies and solutions. Beyond its practice, it holds a deep-seated conviction to enrich society by demystifying the law, actively working to equip citizens with the legal understanding necessary for empowerment and informed participation.
