• Costa Rica Real Estate

Libertarians propose Caja insurance bill for workers earning less than minimum wage

August 24, 2015

Libertarian Movement Party lawmakers Otto Guevara and Natalia Díaz have filed a bill to amend laws governing Costa Rica’s Social Security System, or Caja, to allow insurance for employees who work only a few hours a day or during a specific period.

Bill No. 19,685 aims to incorporate exceptions to Caja’s insurance system that stipulate contributions based on a minimum monthly wage.

In order to offer basic insurance with the Caja, current laws provide only a minimum monthly wage of ₡185,488 ($345). Caja uses this figure to calculate monthly insurance fees for workers even if they earn less than that. The law does not allow for coverage for temporary workers.

The Libertarian Movement proposal aims to create an option for Caja insurance based on a worker’s actual income instead of using a minimum wage for everyone.

Díaz cited several examples of workers who would benefit, including gardeners, domestic employees, construction workers, painters, farmers and seasonal sales employees. Advocates believe the initiative will help strengthen the Social Security System by increasing the number of people who contribute to the Caja.

“We also seek to benefit the productive sector, as we know this initiative will boost new business ideas and will create thousands of new jobs,” Guevara said.

Díaz added that the initiative would help reduce informality in the workforce and boost social insurance coverage for a considerable number of workers who currently do not have any kind of insurance.

A date for discussing the proposal before the full Legislative Assembly is pending.

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