Aguinaldo, meaning "Christmas bonus" in Spanish, is a legally mandated extra payment that employers must provide to workers at the end of each year. While the concept exists across Latin America, the specific rules vary significantly by country.
Aguinaldo by Country
In Mexico, the aguinaldo must be at least 15 days of salary, paid before December 20th each year. Workers who haven't completed a full year receive a proportional amount. In Argentina, it's known as the SAC (Sueldo Anual Complementario) and equals one full month's salary, paid in two installments in June and December. In Guatemala, employers must pay one full month's salary as aguinaldo between December 1 and 15.
Calculation and Proration
Employees who join mid-year receive a prorated aguinaldo based on the months or days worked. The calculation base typically includes regular salary but may exclude certain bonuses or variable compensation depending on local law. Employers must budget for this obligation throughout the year.
EOR Relevance
An Employer of Record in Latin America automatically handles aguinaldo calculations and payments, ensuring compliance with each country's specific rules. This removes the risk of miscalculating this mandatory benefit, which can result in labor penalties and employee disputes.