Peruvian labor legislation contemplates different types of contracts and applying them properly can be somewhat complex since they have divisions and subdivisions. At first glance, with so many names and terms, knowing them all might seem complex.

What is the contract?

Before delving into the different types of contracting and their classifications in our country, let us establish what an employment contract is. It is an agreement between two parties: the worker and the employer. The first agrees to provide his services and is subordinated to the second and, in return, the employer offers a remuneration.

Here we must note that there are three most important elements of an employment contract: First, the remuneration by the employer, and on the other hand, the provision of services and the subordination of the worker.

Types of employment contract

1. Permanent contract

These are employment contracts that have an exact start date, but do not detail an end date. Often, the people who provide services under this figure are considered stable or permanent workers and the work is done continuously. In addition, it is necessary to note that they can be celebrated in writing or verbally.

2. Contract determined or subject to modality

Also known as fixed-term contracts, these are agreements that have a start date and an end date. Those of a specific type cannot be extended beyond 5 years and must always be held in writing.

In this case, the agreement that establishes the employment relationship usually has a specific motivation, so the employer can choose between different modalities.

Contracts subject to modality

It is made up of three main modalities that are in turn subdivided to form a total number of nine possible contracts.

A. Contract of a temporary nature

It is divided into three types:

i. Contract for increased activity

It is used in the hiring of workers when a company has just started its activities or when collaborators are needed who will start a new activity in the company. These contracts cannot be extended for more than three years.

ii. Market need contract

This type of contract seeks to attend to the increase in production due to the activities carried out by the company. When permanent workers are not enough to meet the company’s requirements, it is necessary to hire more staff. Its maximum term of validity is five years.

iii. Contract for business conversion

It is a contract that is used by reason of the substitution, amplification or modification of the activities of the company. This has a maximum term of two years.

B. Contract of an accidental nature

It is divided into three types:

i. occasional contract

The objective of this is to hire workers to meet the needs that are not part of the regular activities of the company. The maximum duration it can have is six months a year.

ii. Substitution contract

Its objective is to hire personnel to replace a stable worker whose employment relationship with the company is suspended for justified reasons. The validity of this contract only lasts until the reinstatement of the replaced worker.

iii. emergency contract

The purpose of this is to cover the needs caused by fortuitous situations or force majeure. Its duration only extends for the duration of the emergency. Generally, it does not exceed one year.

C. Work or service contract

It is divided into three types:

i. Contract for specific work or specific service

They are contracts whose sole purpose is for the company to complete a work or service. Therefore, its validity only extends until the work is completed. The maximum term you can have is five years.

ii. intermittent contract

It is a contract that allows discontinuous needs to be covered. It is used during the occasions in which companies have permanent obligations, but these do not occur constantly, but rather fluctuate temporarily. The term of validity varies according to the need of the employer.

iii. contract per season

The objective of the seasonal contract is to cover the needs inherent to the business of the company when these only occur during certain times of the year.

3. Part-time contract

Finally, part-time contracts are those that establish a working day of less than four hours a day. Therefore, the remuneration will be lower than the minimum and will be awarded according to the hours worked. It is important to note that the collaborators under this contract have access to all the benefits except for the CTS.

Source: Management