Panama: A new law has granted Coercive Jurisdiction to the Ministry of Labor and Taskforce Development
Law No. 237 of the 15th of September 2021 was enacted amending the Panamanian Labor Code, Cabinet Decree No. 249 of 1970 and the Organic Law of the Ministry of Labor and Taskforce Development.
The Ministry of Labor and Taskforce Development now has coercive jurisdiction and can apply fines up to fifteen thousand dollars (US $ 15,000.00) to repeat offenders of provisions established for the protection of the work of nationals.
The amendment of Article 20 of the Labor Code’s General Norms of Labor Protection establishes the fines that may now be applied in case of violation of labor legislation concerning the employment of foreigners.
The fines for hiring unauthorized foreigners are to be applied as follows:
- For the first time, US $ 500.00.
- For the first time, US $ 500.00.
- For the second time, US $ 1,000.00
- For the third time, US $ 15,000.00
- For the fourth time, the Notice of Operation will be cancelled.
The Ministry of Labor and Taskforce Development may delegate its coercive jurisdiction authority to executing judges who have to fulfill the same requirements applicable to be a Municipal Judge.
The Executing Judge shall be in charge of making the collection of the fines. Administrative resolutions and/or judicial resolutions duly issued by the Executing Judge establishing obligations in her/his favor shall be an enforceable instrument.
Private enterprises should conduct a review of all of their personnel in order to determine the migratory work status of foreigners employed in order to prevent problems with the labor authorities. The Ministry of Labor and Taskforce Development shall issue a Manual of Procedures as well as the regulations for the coercive collection procedures according to existing provisions of the Labor Code.
