Introduction
The Chilean Labour Statute contains several rights granted to employees that must be honoured by employers. Those rights cannot be waived by employees during the labour relationship. The most relevant minimum labour rights are: minimum legal wage (currently approx. US$600); 15 working days’ vacation per year; profit sharing; currently maximum 42 hours of work per week; severance; and social security contributions.
Also, our Labour Code considers the regulation for unions, including their objectives, requirements for their constitution, faculties, and the regulation for collective bargaining proceeding, also including a non-exhaustive list of conducts that are considered anti-union practices.
Legal framework
The Chilean Labour Statute is basically composed of the Labour Code and several special social security laws.
New Developments
In the course of 2026, important modifications were made to the Labour Code, including Law No. 21,561 (known as the “40-hour Law”), which highlights the second workweek reduction (from 44 to 42 hours).
A pension reform enacted through Ley N° 21.735 (published on March 26, 2025) transforms the country’s pension architecture by introducing a new mixed system that preserves the individual capitalisation pillar while layering on a mandatory Social Insurance (Seguro Social Previsional) funded exclusively by employer contributions. Employers are now required to contribute 8.5% of the worker’s taxable remuneration, phased in gradually starting at 1% from August 2025 and will increase annually until: 6% is allocated to the worker’s individual capitalisation account (reached progressively, beginning at 4.5%), 1.5% goes to a Protected-Return Contribution pension which generates State-guaranteed pension payments in the worker’s favour, and the remaining 2.5% funds the Autonomous Pension Protection Fund (FAPP). The FAPP finances three key benefits: a years-of-contribution bonus of up to 0.1 UF per 12 months of contributions, capped at 300 months, payable to pensioners aged 65 or older who meet minimum contribution thresholds; a gender life-expectancy compensation for women; and eventually the disability and survivor insurance previously financed by workers. Benefits began phasing in from December 2025 (years-of-contribution bonus and gender compensation) and the Protected-Return Contribution is set to commence in September 2026.
Also, as from 1 December 2026 Law N°21.719 introduces a significantly strengthened data protection framework with direct and material consequences for the employment relationship. In the labour context, employers acting as responsible for the employees’ data are bound by the core principles of licitud, purpose, and proportionality, meaning that only data strictly necessary for the execution of the employment contract may be collected and processed. The processing of sensitive personal data without the employee’s consent is granted when it is necessary for the exercise of rights and fulfilment of obligations in the labour or social security sphere — but only within the framework of the law. Equally significant is the prohibition on automated individual decision-making that produces legal effects on workers — including profiling based on professional performance, health, or behaviour — unless one of the statutory exceptions applies, a provision that limits the use of algorithmic tools in performance evaluation, hiring, and workforce management. The law also requires that compliance programs be incorporated expressly as an obligation in employment contracts or in the employer’s internal regulations under, effectively embedding data protection governance into the fabric of the employment relationship. The duty of confidentiality is perpetual — it survives the termination of the employment relationship — and employers must ensure that their personnel and third-party processors comply with it. Pre-existing restrictions are preserved and reinforced: employers remain prohibited from conditioning hiring on the absence of commercial or financial debt records, on pregnancy, or on genetic information. Biometric data — increasingly common in attendance control systems — now receives explicit heightened protection and may only be processed with the employee’s express written consent and after specific disclosures regarding the system used, its purpose, retention period, and the means for exercising data rights. Finally, from a regulatory standpoint, the creation of the Personal Data Protection Agency as the exclusive competent authority for interpretation and enforcement has already prompted the Department of Labour to formally declare itself incompetent to issue pronouncements on data protection matters.
