Compliance
What is the Próspera Minimum Wage?
Daniel Frazee
March 30, 2022
We make hiring in Próspera easy.
In Honduras, the minimum wage varies by company size, industry, whether hourly or salary, and the time of day the employee works. This is the minimum wage table in Honduras as of the publish date of this article and is typically updated each year:
According to Art. 321 of Honduras Labor Code, Day time wages are considered from 5 am to 7 pm and night wages are those worked from 7 pm to 5 am.
A Mixed wage is considered when theres an overlap between day and night wages that doesn't go over 2:59 hours into a night wage. For example, an employee that works from 1pm to 9pm wouldn't be considered Mixed as they spend less than 3 hours in the night wage.
If an employee works 3 or more hours into the night wage, his whole wage shall be considered night wage and paid as such.
If an employee works during the day and less than 3 hours into the night, their entire wage is payed at mixed wage rate.
The first step of calculating the Próspera Minimum Wage is determining where your employee lands on the Honduran minimum wage. Once you have that number, you add the Próspera Labor Premium.
The Próspera Labor Premium is equal to either 10% of the Base Minimum Wage; or 25% of the Honduran minimum wage if the employee signs a written acknowledgment provided by the employer utilizing a GSP‐approved template that the Employer is not required to furnish employee with any benefit, such as “13th and 14th month” compensation.
You may be wondering why you would ever choose to pay a 25% premium when you could pay 10% premium above the Honduran minimum wage. Well, the Próspera Labor Premium is paid along with the Próspera Labor Benefit. There are two ways of doing this:
10% Próspera Labor Premium and 25% Próspera Labor Benefit
25% Próspera Labor Premium and 10% Próspera Labor Benefit
As you can see, regardless of which Próspera Labor Premium you choose, it evens out with the Próspera Labor Benefit. When the 10% Próspera Labor Premium is chosen, this enables employees to withdraw from the Próspera Labor Benefit Fund for one additional reason: To pay customary “13th and 14th month” compensation, vacation, or holiday pay provided that the Employee previously did not sign a written acknowledgment pursuant to Section 3(a)(1)(ii) of the Próspera Labor Statute.
You’ll need to choose what’s best for your company. At PES, we pay a 25% Próspera Labor Premium and a 10% Próspera Labor Benefit. For us, we’ve found it keeps it simple and reduces the number of Próspera Labor Benefit Fund disbursements that cause additional overhead.
So combining the Honduran minimum wage and the chosen Próspera Labor Premium equals the minimum wage in Próspera. You’ll always need to ensure your team members are paid at or above this minimum wage. If your employees are paid in USD, or some other currency, you should keep in mind fluctuations in conversion rates and understand the Honduran minimum wage is calculated in Lempiras (the local currency).