Employer of record in Panama: costs and rules
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The confirmed portion of an employer's cost in Panama is the Caja de Seguro Social (CSS) employer quota of 13.25% of salary, which is $5,300 a year on a USD 40,000 hire; seguro educativo, the professional risks premium and the decimo tercer mes are not yet included in that figure, and EOR fees on top run from $199 a month (Payoneer Workforce Management, formerly Skuad) to $699 (Oyster), checked October 2026. The change US companies miss is that the CSS quota is climbing in steps: Law 462 of March 18, 2025 adds 3 points to the employer rate in stages, and 13.25% is only the first step, in force from the April 2025 contribution month through the February 2027 contribution month.
An employer of record in Panama is a Panamanian company that becomes your hire's legal employer, registers them with the CSS, pays the employer quota and runs payroll in US dollars, while you manage what they work on.
- Currency
- PAB/USD
On this page
Panama after the 2025 CSS reform
Law 462 of 2025 reformed the CSS, Panama's social security fund, and raised what employers pay. The CSS announced on March 21, 2025 that the employer quota would rise from the April 2025 contribution month, to 13.25% of salaries, one point up. That rate holds through the February 2027 contribution month. The CSS release says the 3-point increase is staggered but does not give the dates or sizes of the later steps, so any multi-year budget should leave room for a higher rate from March 2027.
Payroll is in US dollars. Panama's balboa (PAB) is at par with the dollar, so a USD salary needs no conversion and carries no currency risk for you or the employee.
So far we have confirmed only the CSS employer quota. We have not yet confirmed from an official source: seguro educativo (education insurance), the riesgos profesionales premium by activity, the decimo tercer mes and its CSS treatment, the 2026 minimum wage decree, vacation, seniority pay (prima de antiguedad), dismissal indemnity, probation, notice or working hours. We could not read the contribution articles of the CSS consolidated law text. Ask the EOR for every line it will bill, and check them with the CSS and the Ministry of Labor (MITRADEL).
Employment costs and rules in Panama
| Item | Panama |
|---|---|
| What the employer pays | CSS employer quota 13.25% of salaries from the April 2025 contribution month through the February 2027 contribution month (first 1-point step of a 3-point staggered increase under Law 462 of 18 Mar 2025); seguro educativo, riesgos profesionales and the decimo tercer mes rates not confirmed today |
| Sample salary used | USD 40,000 a year (PAB is at par with USD; no conversion) |
Checked October 17, 2026. Source type: official. Sources are listed at the end of this page.
What an EOR charges to employ someone in Panama
| Provider | EOR fee per employee per month | Deposit | Entity model (provider claim) |
|---|---|---|---|
| Payoneer Workforce Management | from $199 | None listed | Claims owned entities across APAC, MEA, Europe and the Americas |
| Pebl | $399 | Not listed | About 90% of employees on Pebl-owned entities |
| Playroll | from $399 | One month's salary per employee, refundable | No clear owned-entity claim |
| Rivermate | $319 to $639 | Not stated | Claims 38 owned entities |
| Multiplier | $459 (annual) or $499 (monthly) | Sized from costs, fees and notice period (method published, no fixed amount) | Claims owned entities in 160+ countries |
| Rippling EOR | Quote only (third-party reference: $499) | Not listed | Claims Rippling entities; no partner mention |
| Deel | $599 | Not stated by Deel | Claims owned entities in 130+ countries |
| Remote | from $599 | Waived for startups; otherwise not stated | Claims 100% owned entities in 90+ countries |
| Atlas | from $599 | Not published | Claims owned entities in 160+ countries |
| Papaya Global | from $650 | Refundable deposit, amount not stated | Uses in-country partners |
| Oyster | $699 | At least one month of total service cost, refundable (per its terms) | Owned entities and partners |
| Globalization Partners (G-P) | Quote only | Not stated | Information page claims 100+ wholly owned entities |
Source: each provider’s pricing page, checked October 16, 2026. Fees are the provider’s charge on top of salary and the employer contributions above. Some providers adjust prices by country.
The confirmed cost of a USD 40,000 Panama hire
Because Panama pays in dollars, the figures below are final dollar amounts, not conversions. They are the minimum you will pay, not the total.
| Line | Per month | Per year |
|---|---|---|
| Gross salary | $3,333.33 | $40,000.00 |
| CSS employer quota, 13.25% | $441.67 | $5,300.00 |
| EOR fee | $599.00 | $7,188.00 |
| Total of confirmed items | $4,374.00 | $52,488.00 |
CSS quota: CSS press release of Mar 21, 2025. Fee: Deel and Remote $599 list price, Oct 16, 2026. Not included: seguro educativo, riesgos profesionales, decimo tercer mes. Checked Oct 2026.
The quota is 13.25% x $40,000 = $5,300, or $441.67 a month. The fee is $599 x 12 = $7,188. At Pebl's or Playroll's $399 the fee drops to $4,788 a year; at Oyster's $699 it is $8,388.
Three items will raise the total once confirmed: education insurance, a work-risk premium that depends on the job, and the decimo tercer mes, Panama's thirteenth-month payment. Ask the EOR to quote all three and say whether its deposit (Oyster's terms ask for at least a month of total service cost, Playroll a month of salary) covers seniority and dismissal payments. The international cost calculator shows only countries with complete data.
Choosing an EOR for Panama
Multiplier scores 79 out of 100 in our published EOR ratings and Oyster 64, ahead of Remote (62), Playroll (60), Pebl (57) and Deel (54); see our scoring rules. None publishes a Panama price, and Multiplier says about 11% of countries cost more than its list price, so get a written Panama quote that shows the CSS rate it assumes. A quote at 12.25% predates April 2025. Compare the top EOR providers and our Deel, Remote and Oyster reviews.
Panamanian contractors
An invoicing contractor is not on your CSS payroll, so you skip the 13.25% quota and the EOR fee. A full-time role you direct can be treated as employment, which brings back CSS contributions and labor-law payments. For real project work, compare contractor management platforms or a contractor of record.
Your own company in Panama
Each EOR hire costs $7,188 a year in fees. A local company replaces that with CSS registration, MITRADEL compliance and local payroll costs. Use our EOR versus entity comparison and the EOR price comparison to test the numbers.
Frequently asked questions
What is the CSS employer contribution rate in Panama?
How much does it cost to employ someone in Panama on USD 40,000?
Will Panama's employer CSS rate go up again?
Is payroll in Panama paid in dollars?
How much does an employer of record cost in Panama?
Sources (9)
- Pebl: Pebl EOR pricing (checked Oct 16, 2026)
- Playroll: Playroll pricing (checked Oct 16, 2026)
- Multiplier: Multiplier pricing (checked Oct 16, 2026)
- Deel: Deel pricing (checked Oct 16, 2026)
- Remote: Remote pricing (checked Oct 16, 2026)
- Oyster: Oyster pricing (checked Oct 16, 2026)
- Payoneer Workforce Management (formerly Skuad): Skuad pricing (checked Oct 16, 2026)
- Oyster: Oyster terms of service (EOR deposit) (checked Oct 16, 2026)
- prensa.css.gob.pa/2025/03/21/aumento-en-el-pago-de-la-cuota-de-los-... (checked October 17, 2026)
This page is general information, not tax, legal or accounting advice. Rules and rates change, so check the official source linked above before you file or sign a contract. Read our disclaimer.