What it is and who sets it
The minimum wage is the lowest pay an employer can legally give per hour of work. In Panama the Executive sets it by decree, on the proposal of the National Minimum Wage Commission, a tripartite body with representatives of the Government, employers and workers. The Labour Code requires it to be reviewed at least every two years.
The current table is that of Executive Decree 13 of December 31, 2025, published in the Official Gazette on January 6, 2026 and in force since January 16, 2026. It replaced the 2024 table and applies until the next review, expected at the end of 2027.
Two regions, many sectors
Panama divides the country into two wage regions. Region 1 groups the districts with the most economic activity: Panamá, San Miguelito, Colón, David, Santiago, Chitré, La Chorrera, Arraiján, Boquete, Bocas del Toro and about thirty others. Region 2 is the rest of the country. Within each region, the rate depends on the economic activity and, in many sectors, on whether the company is small or large.
| Activity (examples) | Region 1 | Region 2 |
|---|---|---|
| Wholesale and retail trade, large company | B/. 3.02 per hour | B/. 2.48 per hour |
| Construction | B/. 3.51 per hour | Own, lower rate |
| Agriculture, small company | Own rate | B/. 1.64 per hour (the lowest) |
| International flight crew | B/. 5.01 per hour (the highest) | |
| Domestic work | B/. 350 per month | B/. 320 per month |
Figures from Executive Decree 13 of 2025. The full table with all 59 rates is in the Official Gazette and on the MITRADEL website.
How the monthly wage is calculated
- Identify the region where the workplace is, not where the employee lives.
- Identify the company’s economic activity under the decree, and its size.
- Multiply the hourly rate by the agreed weekly hours and by 4.33 weeks a month.
- Add what applies: overtime, holiday and night surcharges are calculated on that base.
What happens if less is paid
Paying below the minimum is a labour offence. The worker can claim the difference before MITRADEL or the labour courts, and the employer faces fines and back pay. The minimum wage is also the base for the thirteenth month, holidays and Social Security contributions.
Frequently asked questions
What is the minimum wage in Panama?
There is no single figure. In 2026 there are 59 hourly rates by region, activity and company size, between 1.64 and 5.01 balboas per hour. The most common in urban commerce is 3.02 balboas per hour, about 628 balboas a month for a 48-hour week.
How often does Panama’s minimum wage change?
Every two years. The current table took effect on January 16, 2026, and the next review is due at the end of 2027.
Does the minimum wage apply to foreigners?
Yes. It applies to every worker hired in Panama regardless of nationality, provided they hold a work permit.
Related articles
- Net salary calculator for Panama
- How to open a company in Panama
- Panama public holidays
- Income tax calculator
Sources
- Ministry of Labour and Workforce Development (MITRADEL), The minimum wage in Panama.
- Executive Decree 13 of December 31, 2025, Official Gazette 30438 of January 6, 2026.
- Labour Code of Panama, articles 172 to 180.
Ask about this article
Type your question and we will show you the answer inside this article or in other Radar Panamá publications.
