Employer of record in Honduras: costs, rules and how to hire
Hire someone in Honduras without opening your own company there.
An employer of record (EOR) can handle local employment while you manage the person’s work. Start by confirming the provider’s coverage and the arrangement available for your specific hire.
By Employ Borderless · We help you understand and compare EOR services.
How does an employer of record in Honduras work?
Three parties, two contracts: the EOR employs the person under a local employment contract, your company signs a service agreement with the EOR and directs the day-to-day work. Which arrangement is legal and sensible in Honduras is decided by the questions below.
Your company
Choose the person, agree their role and manage their daily work.
The employer of record
Handles the agreed employment, payroll and HR services through the employing entity named in your contract.
Your employee
Works with your team under a local employment contract with the EOR’s employing entity.
- Do you already have an entity in this country?
- How many people are you hiring, and for how long?
- Is the work genuinely independent, or is it a job?
- Who carries the employment risk if the arrangement is challenged?
What each route means in full
- Your own entity
- Choose it when: You already have a company here, or you are committing to a substantial local team for the long term.You become the legal employer. You arrange payroll, benefits, filings and employment support yourself, and you carry the setup and running cost.
- Employer of record
- Choose it when: You have a person to hire here, want them employed properly, and do not want to open a company for it.The provider is the legal employer through its own entity. You direct the work and pay one invoice covering salary, employer costs and the service fee.
- Independent contractor
- Choose it when: The work is genuinely independent: their own business, their own methods, their own clients.A contract for services, not employment. The label does not decide the status; how the person actually works does, and getting it wrong is reclassified after the fact.
Hiring in Honduras: the short version
Say you are hiring an accountant in Tegucigalpa at L30,000 a month. Before social security, the employer cost already has two extra salaries on top of pay: a thirteenth month and a fourteenth month, the second paid in June. Spread across the year, those two alone bring the cost to L35,000 a month. Contributions to the IHSS and the RAP come on top, and so does the provider fee.
The question to settle first is who employs your hire: ask which Honduran company signs the contract and runs the payroll, and get the contribution rates it applies in writing.
Your first hire in Honduras in five decisions
Five things settle a Honduran hire, and each one is worked through further down.
- Entity or EOR. No fixed headcount decides it. Compare the annual fee with running IHSS and RAP filings, the two extra salaries and payroll yourself.
- Employee or contractor. A contractor label does not change what the work is. Where the person works inside your team under your direction, employ them.
- Budget line. On L30,000 a month, the thirteenth and fourteenth month salaries add L2,500 each when spread across the year, before social security.
- Exit cost. Notice runs from 24 hours to two months by length of service, and a severance payment is owed on top. Get the provider's current calculation.
- Realistic start. After the employing company, the written contract and the social security registration are settled, not from an advertised onboarding window.
How to hire employees in Honduras
An employer of record employs your hire through a Honduran company, signs the contract, runs payroll and holds the social security registrations, while you direct the work. Ask which company that is, and keep the answer in writing.
From an agreed role to the first payroll
The steps are short, and the employing company is the one to settle first.
- Define the duties and the workplace, and the employer's sector and size, because the minimum wage depends on both.
- Verify the employing Honduran company.
- Agree the written terms: salary, schedule against the 44-hour week, vacation, any trial period and the dates of the thirteenth and fourteenth month salaries.
- Register the hire with social security through the employer.
- Set the payday.
How long the first hire takes, and what sets the date
The contract and the registrations set the date, not a number of weeks. Ask which of these is outstanding, because that is the one holding your start: the employing company, the signed contract, and the social security registration before the first payroll.
EOR, entity, or contractor in Honduras?
Honduran employer cost is higher than salary plus social security, because two extra months of pay sit on top of it every year. Both are owed whoever employs the person, so ask any provider to show them as separate lines.
What can a L30,000 monthly salary cost?
This illustration assumes an unchanged salary for a full year, with the thirteenth and fourteenth month salaries spread across twelve months. It deliberately leaves out the social security rates, which this page does not quote.
| Budget item | Monthly | Annual illustration |
|---|---|---|
| Gross salary | L30,000.00 | L360,000.00 |
| Thirteenth month salary | L2,500.00 | L30,000.00 |
| Fourteenth month salary | L2,500.00 | L30,000.00 |
| Subtotal before social security | L35,000.00 | L420,000.00 |
| IHSS and RAP contributions, company benefits and the provider fee | Add the provider's quoted figures | |
I treat the thirteenth month as a month of salary because the regulation of the fourteenth month says it follows the same terms as the thirteenth. Confirm the payment date of the thirteenth with the provider.
Ask for a complete provider quote
A useful quote names the employer and prices every statutory line, so you can compare two providers on the same salary.
- The Honduran company that employs your hire.
- The IHSS and RAP contributions, with the rates and the year they apply to.
- The thirteenth and fourteenth month salaries, and when each is billed.
- The service fee, deposit and invoice tax.
- The cost of ending the employment, including notice and the current severance calculation, or of moving the hire to your own company.
Compare providers on the same gross salary and benefits, because an advertised fee does not establish the employment budget, and there is no universal headcount at which you should switch to direct employment.
Moving from an employer of record to your own Honduran company
Plan the move around years of service, because vacation, notice and severance all count them. Settle in writing how the accrued thirteenth and fourteenth month salaries and the vacation balance are paid or carried, and take Honduran advice on whether service with the provider counts once the person joins your company.
What should you budget for hiring in Honduras?
Your budget includes salary, employer contributions, agreed benefits and the EOR fee. Ask for a quote for the actual role and salary.
- Gross salary
- Employer contributions
- Benefits and other costs
- EOR service fee
- Gross salary: 100
- Employer social contributions: 7%
- Benefits and EOR fee: quoted per hire
The numbers behind this figure
| Cost | Amount |
|---|---|
| Gross salary | 100 |
| Employer social contributions | 7% |
| Benefits and EOR fee | Quoted per hire |
Source: ISSA, 2024
Published EOR base fees among providers covering Honduras range from $179 to $699 per employee/month. These are provider base prices, not a quote for this hire or the total employment cost.
What an employer of record adds to the employment cost
Budget the provider fee as a third line, next to gross pay and the employer contributions. Across the market it runs from $99 to $799 per employee per month, or 8 to 20% of salary, and where a quote sits in that range is decided by the work rather than by the country: headcount, how much of the administration you hand over, and whether the provider is pricing a single hire or a team. I treat a quote at the bottom of the range as a question rather than a win, because the cheap number is usually the one with the fewest things inside it.
What the fee buys is the employment itself: the employing company, the payroll run, the social security filings and the employer-side administration. What it does not buy is the cost of employing the person. Gross pay, the two extra salaries and the employer contributions are all yours. Ask for a quote that separates the fee from the pass-through costs, because a single blended figure hides which half moves when pay changes.
Source: Servicio de Administración de Rentas, income tax, captured September and October 2026.
Average salary in Honduras by occupation
Gross monthly earnings of employees per ISCO-08 occupation group, in HNL, from the ILO's official labour statistics. These stored survey figures for Honduras have reference year 2025. Use these survey earnings to benchmark an offer before an EOR quote turns it into total employer cost.
| Occupation group | Monthly (HNL) | Approx. USD |
|---|---|---|
| All occupations | 11,248 | $433 |
| Managers · ISCO 1 | 24,284 | $936 |
| Professionals · ISCO 2 | 25,137 | $969 |
| Technicians and associate professionals · ISCO 3 | 18,549 | $715 |
| Clerical support workers · ISCO 4 | 16,593 | $639 |
| Service and sales workers · ISCO 5 | 10,502 | $405 |
| Skilled agricultural, forestry and fishery workers · ISCO 6 | 8,694 | $335 |
| Craft and related trades workers · ISCO 7 | 11,385 | $439 |
| Plant and machine operators and assemblers · ISCO 8 | 12,468 | $480 |
| Elementary occupations · ISCO 9 | 6,150 | $237 |
Source: ILOSTAT, the International Labour Organization's statistics database (average monthly earnings of employees, both sexes), reference year 2025.
How to hire through an EOR in Honduras
- Step 1
Define your hire
Prepare the role, work location, salary, working hours and target start date.
- Step 2
Confirm the local hiring route
Ask the provider to confirm that its employing arrangement fits this role and location, including any restrictions.
- Step 3
Review the full quote and contract
Check the legal employer, total costs, benefits, responsibilities and exit terms before signing.
- Step 4
Complete onboarding
Coordinate employment documents, required checks, equipment and the payroll cut-off with the EOR.
- Step 5
Keep employment changes coordinated
Manage the work and tell the EOR about proposed pay, leave, contract or termination changes before they take effect.
What should the EOR arrange before your hire in Honduras starts?
Confirm the employment terms, work eligibility, payroll and pension arrangements before the start date. Ask which local rules and agreements apply to your employee.
What types of employment contracts exist in Honduras?
For most hires through an employer of record, expect an indefinite contract. It is the contract the trial period and notice rules are written for.
Trial period
A trial period may not exceed 60 days and is paid. It must be agreed in writing; without that, the general rules of the employment contract apply. If neither side ends the contract when the trial period finishes, it continues indefinitely.
Notice
Either side can end an indefinite contract with notice: 24 hours under three months of service, a week from three to six months, two weeks from six months to a year, a month from one to two years, and two months after two years. During notice, an employee being dismissed gets one paid day a week to look for new work.
Put the employment terms in writing
State the employer, the duties, the workplace, the start date, the salary, the schedule against the 44-hour week, the vacation, any trial period, and the dates of the thirteenth and fourteenth month salaries.
Misclassification risk
A contractor agreement for someone who works inside your team, on your schedule and under your direction, describes employment. I have not read a penalty schedule for misclassification in this pass, so I am not going to quote one.
Source: Código del Trabajo y sus reformas (Secretaría de Trabajo y Seguridad Social), captured September and October 2026.
What catches employers out in Honduras
Six points decide whether a Honduran payroll is right. Ask the provider how each one is handled before the first payslip.
| Point | Why it changes the decision |
|---|---|
| Two extra months of salary | A thirteenth month and a fourteenth month, the second paid in June unless agreed otherwise. |
| Minimum wage depends on sector and size | The 2026 table runs from L9,596.64 to L19,298.72 a month by sector and number of workers. |
| Vacation grows quickly | From 10 working days after one year to 20 after four years with the same employer. |
| Notice runs both ways | From 24 hours to two months by service, and a dismissed employee gets a paid day a week during notice to look for work. |
| The trial period must be written | Up to 60 paid days, agreed in writing, or the general contract rules apply. |
| The rules' date | The Code compilation I read may not reflect every later reform, so severance and maternity leave are not quoted as figures here. |
Source: Secretaría de Trabajo y Seguridad Social, 2026 minimum wage table, captured September and October 2026.
What taxes and social contributions apply in Honduras?
Employers in Honduras contribute to the IHSS, the social security institute, and to the RAP, the private contributions fund that also manages the labour reserve fund under a 2024 law, Decree 47-2024. I could not reach either institution's own pages, so this page does not quote their rates. Ask the provider for the rates on the payslip, the ceilings they apply to, and the year they cover.
Income tax on salaries
The employer withholds income tax through payroll using a progressive table that the tax authority, the SAR, updates each year; the 2026 table was published in Agreement SAR-01-2026 in January 2026. Ask the provider for the withholding calculation behind the payslip rather than estimating from an old table.
What pay and leave should your offer in Honduras cover?
Agree pay, working patterns, paid leave and benefits as part of the offer. These affect both your hiring budget and how you plan the employee’s work.
- Paid annual leave: 10 days
- Public holidays: 11 days
- The rest of the year: 344 days
The numbers behind this figure
| Entitlement | Days a year |
|---|---|
| Paid annual leave (statutory minimum) | 10 days |
| Public holidays (national) | 11 days |
| Total statutory paid days off | 21 days |
Source: National government, 2026. Statutory minimums. Eligibility, accrual and collective agreements can change what an individual employee receives.
How does payroll and compensation work in Honduras?
Honduras sets its minimum wages each year by sector and by company size. From 1 January 2026, under Agreement SETRASS-233-2026, they run from L9,596.64 to L19,298.72 a month. For a professional role they rarely bind, but check the band for the employer's sector and headcount.
Hours and overtime
| Topic | Rule in the Labour Code |
|---|---|
| Daytime hours | At most eight hours a day and 44 a week, paid as 48. |
| Night hours | At most six hours a day and 36 a week. |
| Overtime in daytime | A 25% surcharge. |
| Overtime at night | A 50% surcharge on the daytime rate, or 75% on the night rate when it extends a night shift. |
The thirteenth and fourteenth month salaries
The fourteenth month is 100% of a month of salary if the year of continuous work is complete at 30 June, and a proportional part otherwise. It is paid in June unless the parties agree another date, on the average ordinary salary of the year. The regulation says it follows the same terms as the thirteenth month, so budget a month of salary for each, and agree both dates in the contract.
Read this in full under “What catches employers out in Honduras”.
What benefits and leave are employees entitled to in Honduras?
Vacation in Honduras grows fast with service, from 10 working days after the first year to 20 after four years. Maternity leave is paid; get its current length from the provider.
Leave entitlements
| Service with the same employer | Minimum paid vacation |
|---|---|
| One year | 10 consecutive working days |
| Two years | 12 consecutive working days |
| Three years | 15 consecutive working days |
| Four years or more | 20 consecutive working days |
Holidays
The Labour Code lists the paid national holidays: 1 January, 14 April, 1 May, 15 September, 3, 12 and 21 October, 25 December, and Holy Thursday, Friday and Saturday, paid even when they fall on a Sunday. Confirm the year's calendar with the provider.
Three things on this page are described without figures on purpose: the severance payment, the length of maternity leave, and the social security rates. The Labour Code compilation I read may not reflect every later reform on the first two, and I could not reach the social security institutions' own pages. Get the current figures from the provider, in writing, before you budget.
What happens if you need to end employment in Honduras?
Discuss the proposed change with the EOR before giving notice or promising an exit payment. Ask it to confirm the procedure, timing and costs for the employee’s circumstances.
The numbers behind this figure
| Obligation | Weeks of salary |
|---|---|
| Statutory notice | 7.2 weeks |
| Statutory severance | 23.1 weeks |
| Total statutory exit cost | 30.3 weeks |
Honduras sits at number 12 of 190 countries for statutory exit cost in our Termination Cost Index.
What are the termination and compliance rules in Honduras?
Ending an indefinite contract takes notice, and a dismissal without just cause adds a severance payment, the auxilio de cesantía, that grows with years of service. This page does not quote the severance figures: the Code compilation I read may not reflect later reforms to them. Ask the provider for its current calculation in writing.
Notice
Notice runs from 24 hours under three months of service to two months after two years. During notice, an employee being dismissed gets one paid day a week to look for new work.
During the trial period
The trial period lasts up to 60 paid days and must be agreed in writing. If neither side ends the contract when it finishes, it continues indefinitely.
These are stored source rules, not a case-specific termination calculation. Confirm the applicable procedure and current requirements before acting.
Choose an EOR for your hire in Honduras
Compare the employing entity, itemised costs, local support, payroll deadlines and what happens if you change or end the arrangement.
Questions about hiring in Honduras
What does an employer of record do in Honduras?
An employer of record employs your hire through a Honduran company, signs the contract, runs payroll and holds the social security registrations, while you direct the work.
Can I hire in Honduras without setting up my own company?
Yes, through a provider whose Honduran company employs the person. Confirm the employing company and the contribution rates it applies before you compare prices.
Is an EOR the same as a PEO?
No. With an employer of record the provider's Honduran company is the legal employer; with a PEO or payroll service your business remains the employer and needs its own registrations. Compare EOR and PEO service models.
What is the minimum wage in Honduras?
From 1 January 2026, monthly minimum wages run from L9,596.64 to L19,298.72, depending on the sector and the number of workers in the company.
What are the thirteenth and fourteenth month salaries?
Two extra salaries a year. The fourteenth is 100% of a month if the year of service is complete at 30 June, paid in June unless agreed otherwise, and follows the same terms as the thirteenth.
How much paid vacation does an employee get?
10 working days after one year with the same employer, 12 after two, 15 after three, and 20 after four years or more.
What are the working hours and overtime rules?
At most eight hours a day and 44 a week in daytime work, paid as 48, and six hours a day and 36 a week at night. Overtime carries a 25% surcharge in daytime, 50% at night, and 75% when it extends a night shift.
How much notice is needed to end employment?
From 24 hours under three months of service to two months after two years, in five steps. A dismissed employee gets one paid day a week during notice to look for work.
What does it cost to dismiss an employee?
Notice, plus a severance payment that grows with years of service. This guide does not quote the severance figures because the Code compilation available may not reflect later reforms, so get the provider's current calculation in writing.
Is there a probation period?
Yes, up to 60 paid days, agreed in writing. If neither side ends the contract at the end of it, it continues indefinitely.
Does an EOR fee include the employment costs?
No. The fee, from $99 to $799 per employee per month or 8 to 20% of salary across the market, buys the employment administration. Gross pay, the extra salaries and the employer contributions are pass-through costs, so ask for a quote that separates them.
Check the facts behind this guide
Each reviewed fact links to its source and shows its validation date and effective period. Monthly review does not mean that every rule changes monthly. Statistical benchmarks retain their original data periods.
View sourced facts and review dates
| Fact | Value | Source | Effective / data period | Last validated |
|---|---|---|---|---|
| Eight hours a day, 44 a week paid as 48 | The ordinary daytime working day is at most eight hours and 44 hours a week, paid as 48 hours. Night work is capped at six hours a day and 36 a week. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, article 322 | ||
| Overtime at 25%, 50% or 75% extra | Overtime is paid with a 25% surcharge in daytime, 50% when done at night, and 75% on the night rate when it extends a night shift. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, article 330 | ||
| Vacation from 10 to 20 working days | After each year of continuous service with the same employer, paid vacation is at least 10 working days after one year, 12 after two, 15 after three, and 20 after four years or more. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, article 346 | ||
| Fourteenth month salary, paid in June | Permanent employees are entitled to a fourteenth month salary: 100% of a month if the year of continuous work is complete at 30 June, or a proportional part. It is paid in June unless the parties agree another date, and the regulation says it follows the same terms as the thirteenth month salary. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, regulation of the fourteenth month salary, articles 1, 2 and 5 | ||
| Minimum wage: L9,596.64 to L19,298.72 a month | From 1 January 2026, monthly minimum wages run from L9,596.64 to L19,298.72, depending on the economic sector and the number of workers in the company, under Agreement SETRASS-233-2026. | Secretaría de Trabajo y Seguridad Social: tabla de salario mínimo 2026 (Acuerdo SETRASS-233-2026) | Honduras: private-sector employment under the Código del Trabajo, subject to the contract, any collective agreement and more favourable terms | |
| Notice from 24 hours to two months | Either side can end an indefinite contract with notice: 24 hours under three months of service, a week from three to six months, two weeks from six months to a year, a month from one to two years, and two months after two years. During notice, an employee being dismissed gets one paid day a week to look for work. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, article 116 | ||
| A paid trial period of up to 60 days | The trial period may not exceed 60 days, is paid, and must be agreed in writing. If neither side ends the contract when it finishes, the contract continues indefinitely. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, articles 49 and 50 | ||
| Paid national holidays set in the Labour Code | The Labour Code lists the paid national holidays: 1 January, 14 April, 1 May, 15 September, 3, 12 and 21 October, 25 December, and Holy Thursday, Friday and Saturday, paid even when they fall on a Sunday. | Código del Trabajo (Decreto 189-59) y sus reformas, compiled by the Secretaría de Trabajo y Seguridad Social, article 339 |