Facts & Stats
- Capital City
Cuban peso ($, CUP)
- Population size
- Ease of doing business
- Cost of living index
- Payroll frequency
- VAT - standard rate
- GDP - real growth rate
Cuba is a socialist island republic off the southern coast of the United States. Cuba has enjoyed a long history since the 4th century B.C. that’s seen the country change hands from indigenous control, Spanish colonization, and United States occupation, before it achieved independence in 1902.
Much of the Cuban economy is government-controlled, and only 13% of workers are officially employed by private businesses; that in itself is an improvement since Cuba used to have 91% of the economy controlled by the state.
Although the country of 11 million has opened up to the world, it still maintains its antique charm, with Baroque Spanish-colonial architecture, vintage cars, exotic carnivals, and specialty coffee species like the Cafecito, Colada, Cortadito, and Café con leche.
Government intervention has set back the Cuban economy in the health, education, finance, and manufacturing industries, mainly because of a massive brain drain. Since the Cuban Revolution of 1959, over 1.5 million Cubans have fled the country for asylum in the United States.
After years of economic sanctions since the days of the Cold War, Cuba has warmed up to the west. But there’s still a long way to go before the country can claw its way back to the west. Although the United Kingdom and the EU have taken steps towards normalizing relations with Cuba, the United States still imposes sanctions on American individuals and businesses conducting trade with Cuba.
In recent times, Cuba has over 2.3 million youths below age 18. Among that are a significant number of experts and professionals who are eager to work remotely with global brands without leaving home.
Grow your team in Cuba with Remote
Note that we are busy building our own entity in Cuba to provide you with the best possible employment solutions for your employees, but our employer of record service is not yet live in this country.
To employ in Cuba, companies must own a local legal entity in the country or work with a global employment solution. Developing the processes required to manage payroll, benefits, taxes, and onboarding in countries like Cuba can get complicated fast, especially without localized expertise.
If you’re looking to start hiring in a country like this, partnering with a global employment solution like Remote makes it easy for your company to employ workers quickly, cost-effectively, and in full compliance with all local legislation.
In the countries where we do offer our EOR services, Remote takes on the responsibility and legal risks of international employment so you can focus on hiring great talent and growing your business.
Risks of misclassification
Cuba, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Cuba may lead to fines and penalties for the offending company.
Employing in Cuba
The Cuban constitution states that the country is a democratic, socialist workers’ republic. It’s all a pointer to the fact that the state takes workers rights seriously, as spelled out in regulations such as:
The Cuban Constitution of 2019
The Labor Code, i.e. Law No. 116 of December 20, 2013
Law No. 105 On Social Security of December 27, 2008
— all of which guarantee equal pay for equal work, the right to individual and collective labour disputes, safe working environments, and protections against discrimination based on age, religion, and race.
Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off.
Cuba’s minimum wage is fixed at CUP 2,100 ($87.52) per month. Of course, it’s a given that skilled employees and expatriates based in the country will negotiate rates on a case-by-case basis which will tend to be higher than the minimum wage.
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Competitive benefits package in Cuba
At Remote, we’re obsessed with helping you craft the best possible employee experience for your team. We are leading the way in practicing “fair equity”, which means making sure employees everywhere have access to both the required and supplemental benefits they need to thrive (and that will allow you to attract the best local talent).
We are still busy building our own entity in Cuba, but our benefits packages for all countries are tailored to fulfill the local needs of your employees. Typically, our packages contain some or all of the following benefits:
Mental Health Support
Pension or 401(K)
Life and Disability Insurance
Taxes in Cuba
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Cuba.
Types of leave
Cuban employees are entitled to 30 days of paid vacation.
Cuban employment law states that employees cannot be ‘fired’ but can be returned to the hiring pool (or the entity that hired them to the employer) in a process known as devolución.
Employees can be dismissed at will as long as they're notified in advance and paid any applicable severance benefits — unless for cases of severe misconduct, for which an employee can be dismissed without severance payments.
Indefinite contracts can be terminated with 30 days’ notice, while employers are required to provide 15 days’ notice before dismissing workers who’re employed on temporary contracts.
Cuban employees are entitled to severance payments proportional to their tenure with an employer, such as:
Up to nine years of employment: one month’s salary
10 to 19 years of employment: two months’ salary
25+ years of employment: three months’ salary
30+ years of employment: five months’ salary
Limited to 180 days, i.e. six months. Contracts can be terminated without penalty during the probation period.