Overview of Article. Puerto Rico is a Commonwealth of the United States easily accessed by travelers from the U. S. mainland, and its citizens are U. S. citizens. However, U. S. or multi-national employers who conduct business in Puerto Rico, or who plan to do so, should be aware that Puerto Rico's local statutes provide far greater rights to its employees than do any of the laws of the 50 U. S. states. Employment matters are regulated in Puerto Rico both under federal U. S. law and local statutes, regulations, case law and provisions of Puerto Rico's Constitution.
Local Puerto Rico employment statutes include provisions on a wide range of employment-related matters. This article will focus on some key principles of which employers should be aware regarding the hiring and separation of employees in Puerto Rico.
Employees in Puerto Rico are not at-will employees. All employees in the 50 U. S. states, with the exception of Montana, are considered employees at will, meaning that they can be discharged at any time and for any reason, unless the discharge is in violation of a contract, applicable law, or public policy. However, employees in Puerto Rico are not employees at will. Instead, the laws in Puerto Rico provide numerous safeguards for employees in terms of the legal and monetary ramifications of employment termination.
Indefinite Term Contracts. Where a termination date is not provided in the employment contract or other documents regarding the employment relationship, the employment will be considered a contract for an "indefinite term", causing the employee to be protected by the terms and conditions of Puerto Rico laws, including those pertaining to termination without just cause.
Fixed-Term Contracts. In general, the dismissal of an employee contracted for a certain term or project will be presumed to be an unjust dismissal except when a discharged employee has a contract for a term of employment or project. However, employers should understand that the fact that a discharged employee provided services under a fixed-term contract does not, in itself, automatically deprive that employee of the protections of Puerto Rico's laws regarding the separation of law of those working without a fixed term if the circumstances indicate an employee's expectation of employment continuity or of a bona fide employment contract for an indefinite period of time.
What is a discharge under Puerto Rican law? In addition to an employee being...