Contents of this guide
What thirteenth-month pay is, who receives it and the law behind it
Article 1 of Cabinet Decree 221 of November 18, 1971 (Gaceta Oficial 16989) requires every employer to pay this special bonus to its workers, on top of what labor rules already provide. Article 4 extends it to private activities and to public institutions that receive no subsidy from the national government. Decree 19 of 1973 sets the scope and the calculation base, and Law 20 of 1992 restored the second installment from August 14, 1992. Public servants are also covered by Law 52 of 1974.
The decree counts as worked days those of illness, accident, maternity, leave and vacation that are properly documented. An adviser to the Ministry of Labor’s top office (MITRADEL) said on a television program, as reported by Panamá América, that people who provide professional services are not entitled to the bonus.
The three installments and their payment dates
Article 3, as replaced by Cabinet Decree 52 of February 24, 1972 according to the text compiled by Sijusa, sets three proportional installments. In the original version, published in Gaceta Oficial 16989, the first fell due on March 15.
| Installment | Legal deadline (private sector) | Weekday in 2026 | Status on October 13, 2026 |
|---|---|---|---|
| First | April 15 | Wednesday | Past due date |
| Second | August 15 | Saturday | Past due date |
| Third | December 15 | Tuesday | Pending |
The rules opened for this article do not say what happens when the 15th falls on a weekend, so that case is checked with MITRADEL.
The rules do not give exact dates for each period: Decree 19 refers to “the period that corresponds to each installment”. La Estrella de Panamá describes it as December 16 to April 15 for the first, April 16 to August 15 for the second and August 16 to December 15 for the third. Other guides use whole months, so the cut-off is confirmed with MITRADEL or an accountant.
How thirteenth-month pay is calculated, with an example
Article 2 of the 1971 decree sets one day of pay for every eleven days of effective work. Decree 19 adds that each installment is calculated on the average of the pay received in the period, including base salary, extraordinary shifts, commissions, bonuses, paid leave and vacation. That is why overtime surcharges count in the base. The press sums it up this way: everything received in the period is added up and divided by 12.
- Set the installment’s period. Four months, with the cut-off confirmed with MITRADEL.
- Add what was received. Base salary, overtime with surcharge, commissions, bonuses.
- Include paid days off. Leave and paid vacation are part of the sum.
- Divide the total by 12. The result is the gross installment, before deductions.
- Prorate if the period was not fully covered. Only what was received in the months worked counts.
Illustrative examples, with made-up figures used only to show the operation:
| Case (illustrative) | Received in the period | Gross installment |
|---|---|---|
| Fixed salary of 800 dollars a month | 3,200 dollars | 266.67 dollars |
| Salary of 800 dollars and 50 of overtime in one month | 3,250 dollars | 270.83 dollars |
| Salary of 1,000 dollars and 400 of commissions in the period | 4,400 dollars | 366.67 dollars |
| Hired mid-period, 2 months at 900 dollars | 1,800 dollars | 150.00 dollars |
Illustrative and before deductions. Under article 3 of the decree and Law 20 of 1992, Social Security contributions and income tax apply to the bonus; the rates are confirmed with the CSS and the tax authority. The CSS revenue regulation requires these sums to be reported in the April, August and December payrolls.
With the salary and what was received in the period, Radar’s calculator gives the gross installment in seconds.
Base pay can be checked against the legal floor in the guide to the minimum wage in Panama, and what each side pays into Social Security is in the one on Social Security contributions.
Public and private sector
In the private sector the decree’s deadline applies and each employer pays. In the public sector, Law 52 of 1974 sets the same dates as a maximum, and the actual calendar is announced by the Ministry of Economy and Finance. The Comptroller General’s Office said on August 5, 2026 that the second installment would be paid on Thursday, August 6, 164,859,362.02 balboas to 300,046 servants, according to its press release. Telemetro reported that the MEF set the third installment for Friday, December 4, 2026. Law 52’s calculation base was amended after 1974, so the amount is confirmed with each servant’s institution.
What happens if the employer does not pay, and the deadlines
The bonus cannot be seized and enjoys the other protections of wages (article 3). Under Decree 19, a contract clause that limits it is valid only if it favors the worker. The worker can go to MITRADEL, and the Labor Code provides that an administrative claim interrupts the limitation period (article 12, item 7).
On late payment, the adviser quoted by Panamá América in August 2023 said it is possible only by agreement with the worker and with a 10 percent surcharge. The report cites no rule and that percentage appears in none of the legal texts opened for this guide, so it stays an attributed statement. A specific fine was not verified either.
Article 221 of the Labor Code sets one year from separation for claiming benefits derived from the end of the contract, and the proportional thirteenth month is usually claimed with the severance settlement. The edition consulted is a Justia compilation, so the deadline for each case is confirmed with MITRADEL or a labor lawyer.
Frequently asked questions
When is the second thirteenth-month payment of 2026?
In the private sector the deadline was August 15, 2026, and public servants were paid the second installment on Thursday, August 6, according to the Comptroller General’s Office. The next installment falls due on December 15.
When do private companies pay the thirteenth month in Panama?
By April 15, August 15 and December 15 each year, under article 3 of Cabinet Decree 221 of 1971 as amended by Cabinet Decree 52 of 1972.
When do public employees get the December thirteenth-month payment?
The MEF set Friday, December 4, 2026 for the public third installment, according to Telemetro. The law sets December 15 as the latest date.
How is the thirteenth month calculated in Panama?
What was received in the installment’s period is added up, with overtime, commissions and bonuses, and the total is divided by 12, under Decree 19 of 1973 and the press summary.
What happens if the thirteenth month is not paid in Panama?
The worker can file a claim with MITRADEL, and an administrative claim interrupts the limitation period under the Labor Code. If the contract ended, the claim for benefits lapses one year after separation.
Related articles
- Thirteenth-month pay calculator for Panama
- Minimum wage in Panama: how it is set, regions, sectors and how it is calculated
- Social security contributions in Panama: what the employee pays, what the employer pays and what changed
- Overtime in Panama: day, night and mixed-shift surcharges with a table
This content is informational and does not replace the advice of a labor lawyer or an accountant on a specific case.
Sources
- Cabinet Decree 221 of 1971, Gaceta Oficial 16989 and compiled text with amendments (Sijusa).
- Decree 19 of 1973, Gaceta Oficial 17436: calculation base.
- Law 20 of 1992, Gaceta Oficial 22099 and Law 52 of 1974, Gaceta Oficial 17617.
- CSS General Revenue Regulation, article 50 and Labor Code, articles 12 and 221.
- Comptroller General’s Office, second installment of 2026 and Telemetro, public-sector dates.
- La Estrella de Panamá, how to calculate the payment and Panamá América, payments past the due date.
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