Nicaragua - Increase in minimum wage for 2020

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On February 6, 2020, Nicaraguan Ministry of Labor issued the Ministerial Agreement number ALTB-01-02-2020, which establishes that as of March 1, 2020, a new adjustment of 2.63% will be applied to the minimum wage applicable in Nicaragua.

The National Minimum Wage Commission, formed by the Government of Nicaragua, the union sector, and the private-sector business agreed that said adjustment will apply to all workers in the public and private sector of Nicaragua, establishing that in cases where the salary needs to be stipulated based on production or performance standards, the units of measures must be maintained without any alteration, but must be revalued as a result of readjustment.

Furthermore, through this agreement, the wage adjustment of 8.25% for the Free Zone industries was ratified, which was approved as of January 1, 2020, therefore, the 2.63% adjustment does not apply to this sector.

It is important to note that, although the Nicaraguan Minimum Wage Law (Law No. 625) establishes that the indicators that should be considered when setting the half-yearly wage variation are inflation and economic growth, in 2019 there was no wage adjustment in the economic sectors of Nicaragua. In this regard, it was also agreed that this adjustment will be the only one to be applied this year, so there, there will be no other adjustments in the second half of 2020:

Economic sector Percentage New monthly salary in córdobas (C$) New monthly salary in dollars approximate (US$)
Agriculture 2.63% C$ 4,286.33 US$ 126.30
Fishing 2.63% C$ 6,517.49 US$ 192.00
Mining and Quarrying 2.63% C$ 7,698.07 US$ 227.50
Manufacturing Industry 2.63% C$ 5,763.44 US$ 170.00
Special Scheme Industries 8.25% C$ 6,399.07 US$ 188.50
Micro and Small National Handicraft and Tourism Industry 2.63% C$ 4,605.42 US$ 135.00
Electricity and Water; Commerce, Restaurants and Hotels; Transportation, Storage and Communications 2.63% C$ 7,861.99 US$ 232.50
Construction, Financial Establishments and Insurance 2.63% C$ 9,592.40 US$ 283.10
Community, social and personal services 2.63% C$ 6,008.97 US$ 177.00
Central and Municipal Government 2.63% C$ 5,345.22 US$ 157.50

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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