Yes - For expats it is very difficult. Many new arrivals are shocked to learn how protective Costa Rica is of its labor force; the rule of thumb is that “if a Tico can be found to do the job, hiring an expat to do it is forbidden.” There are two exceptions to that law:
If the position requires specialized or unique skills, and a Tico with those qualifications isn’t commonly available, an expat can be hired to fill the position. However, to legally employ the expat the employer must apply for a “Work Permit” for the person to be hired. Many employers are not willing to go through that process because it requires extensive paperwork and expense, and can take up to six-months for the Work Permit to be issued. And, under the law, the employee cannot actually perform the work at that position until the permit is issued.
Costa Rica law does allow foreigners to earn money in Costa Rica by purchasing and owning a business, but it prohibits them from working as an employee of that business; for instance an expat can open or purchase a beauty shop but they cannot work as a hair dresser, receptionist, or at any other position in that business. Another example is that a foreigner can purchase a bar but is prohibited from working as a bartender. In both cases, the owner must be “hands off” – they cannot answer the phone and make appointments or manage the business on a daily basis; a Tico must be hired to fill those positions.
In either case, those persons found violating the labor laws will be required “to leave the country,” (voluntarily deported) usually within 30 days, regardless of the social or financial investment or commitments that person may have in Costa Rica, or face being imprisoned.
There is one way an expat can legally generate an income in Costa Rica; there is no prohibition for persons to work remotely from within the country. That is, a person can have a business outside of Costa Rica which they operate via internet, and / or telephone, such as booking birthday parties in Montana or doing marketing consulting with taffy manufacturers in Europe. However, if the income from the business is directly deposited in a Costa Rican bank account it will be subject to Costa Rican income taxes.
If you have read FAQ #38 you may have learned that Costa Rica has some different labor laws. Even hiring part-time laborers, such as a maid or gardener, exposes the “employer” to some very specific employment laws, this can result in large, unanticipated expenses. Therefore, before hiring any part-time or full-time employee, you should consult with an experienced attorney who can advise you of your legal obligations and how to best protect yourself from lawsuits.
ARCR has English-speaking associate attorneys who have extensive experience in assisting MEMBERS with interpreting and understanding the Costa Rican labor laws for hiring full and/or part-time help.