May 20, 2026
By: Kimberly Esquivel
Labor Management Department - EAS LATAM
Article 62 of the Political Constitution of Costa Rica recognizes that collective bargaining agreements entered into in accordance with the law have the force of law. The Labor Code also gives them the character of professional law and establishes that their provisions may be binding within the corresponding scope of application.
1. Legal nature of a collective bargaining agreement
A collective bargaining agreement is a formal agreement that regulates working conditions and related matters within a specific scope. In business practice, it may become a direct source of obligations for the company and a mandatory reference for Human Resources, Finance and Operations.
The key point for companies is that the collective bargaining agreement should not be managed as an isolated document. Its content may affect individual employment contracts, internal policies, regulations, payroll budgets, benefits and disciplinary procedures.
2. What does a collective bargaining agreement usually include?
Although each agreement depends on the negotiation, the type of company and its operating reality, these instruments normally regulate labor conditions, benefits, internal procedures and mechanisms for the relationship between the company and employee representatives.
Work schedules and shifts: schedules, rotation, night shifts, rest periods and operational continuity.
Salaries and adjustments: salary scales, periodic increases and additional payments by category, seniority or special duties.
Bonuses and incentives: productivity, attendance, target-based or collective performance bonuses.
Additional benefits: meals, transportation, uniforms, insurance, scholarships or family benefits.
Leaves and permits: medical appointments, bereavement, personal matters, maternity, paternity and other cases.
Vacation and rest periods: vacation scheduling, collective vacations, holidays and compensatory rest rules.
Occupational health: protective equipment, committees, active breaks, ergonomics, risk prevention and internal protocols.
Disciplinary procedures: prior steps before sanctions, right of defense, internal investigations and corrective measures.
Internal mobility and training: promotions, transfers, internal competitions, technical training, languages and certifications.
Conflict resolution: internal committees, claim procedures, conciliation and communication channels.
3. Why does this matter for free trade zone companies?
Companies operating under the Free Trade Zone Regime are subject to a special framework of incentives and obligations. Law No. 7210 defines this regime as the set of benefits granted by the State to companies that make new investments in the country and comply with legal and regulatory requirements, including manufacturing, processing, repair, maintenance of goods and export-oriented services.
However, belonging to the free trade zone regime does not replace the application of Costa Rican labor law. If a private company has an applicable collective bargaining agreement, it must manage it as part of its labor, financial and operational compliance system.
In a free trade zone operation, a clause on shifts, incentives, meals, transportation, leaves or disciplinary procedures may have relevant effects on operational continuity, payroll costs, productivity indicators and internal conflict management.
4. Filing with the MTSS: a key validity requirement
In practice, companies often speak of “registration”, but the correct technical term is filing with the Ministry of Labor and Social Security. The Labor Code provides that a collective bargaining agreement must be executed in writing in three copies: one for each party and a third one to be filed with the corresponding MTSS office.
This rule is relevant because the agreement has no legal value until the date on which the copy is filed. Therefore, a private company should not manage this instrument only as an internal agreement signed and archived.
5. Can a collective bargaining agreement be “deregistered”?
It is not advisable to speak of “deregistration” as if it were the cancellation of a license or the removal of a filing. The applicable legal figure is the denunciation of the collective bargaining agreement. This denunciation should not be confused with a criminal or administrative complaint; it is a formal communication to prevent the agreement from being automatically extended at the end of its term.
The Labor Code provides that the agreement must state its duration and effective date. Its term may not be less than one year or more than three years, and it is automatically extended for an equal period if neither party denounces it one month before the respective expiration date.
The Office of the Attorney General has explained that denunciation is a formal expression of will to prevent automatic extension and terminate the agreement at the corresponding expiration date. If the notice is not filed within the required period, the agreement is deemed extended by operation of law.
Practical control questions for private companies
Is there a collective bargaining agreement currently in force?
Which centers, positions or employees are covered by it?
Which clauses have an economic impact on payroll, benefits or incentives?
Which provisions affect shifts, continuity of service or operational planning?
What procedure must be followed before imposing sanctions or termination?
Is the agreement aligned with regional corporate policies?
Is the expiration date controlled to avoid automatic extensions?
In the Costa Rican private sector, a collective bargaining agreement may become a direct source of labor, economic and operational obligations. Its effect is not limited to the legal area; it also reaches Human Resources, Finance, Operations and General Management.
For free trade zone companies, where operational efficiency and labor cost control are critical factors, properly reviewing the scope of a collective bargaining agreement allows management to anticipate contingencies, organize internal processes and make decisions with greater certainty.
The business recommendation is clear: these instruments should not be managed as isolated documents. They should be reviewed, budgeted, communicated and applied consistently within the company’s labor management system.
References
Political Constitution of the Republic of Costa Rica, article 62.
Costa Rican Labor Code, Law No. 2, articles 54, 55, 57 and 58.
Ministry of Labor and Social Security, Collective Bargaining Agreements Section.
Free Trade Zone Regime Law, Law No. 7210, article 1.
Office of the Attorney General of the Republic, criteria on denunciation and extension of collective bargaining agreements.