As the growth of new Act 20 companies persists, many owners are looking to hire local talent. CASPR works with these businesses to build the perfect team, and has observed some common goals for both parties - employees and employers, alike. In this piece we outline and discuss what employees value most.
When a potential hire is evaluating an Act 20 company, the opportunity to grow with the company is at the top of their priorities. We feel confident these companies will be profitable, as many entrepreneurs are moving their established business to Puerto Rico or creating a service company to support current operations. Employees want to see a plan in place for the right incentives - the opportunity to earn more responsibility and compensation as time passes.
Secondly, being part of a team is especially important for candidates. By design, Act 20 companies can operate from anywhere. While working from home has its perks, it voids the opportunity for building relationships. If you are considering starting an Act 20 business with employees, we highly recommend looking into a co-working space such as Spehce or CoSPAZIO.
Accessible owners and influencing business decisions also appear high on the list. Working for an Act 20 company can be a fast track to an executive position, but if the employee is relegated to remedial tasks, motivation starts to deteriorate quickly.
While average wages are 20-40% lower than the mainland, owners should still expect to pay a premium for top, skilled labor. Similarly to the US, younger employees value higher salaries over benefits, as well as a reasonable work life balance. Older employees are looking for security and stronger benefits. Keep this in mind as you look to attract the young all-star or the seasoned veteran.
Puerto Rico recently went through labor reform, which has given more power to the employer. That being said, there are some unique requirements that must be followed. Companies are required by law to provide Christmas bonuses, and this has become a standard in the marketplace. Vacation time is also more generous compared to the US, with 3 weeks being the standard.
As part of the labor reform, employers are permitted to have a year long probationary period - something unheard of in the continental US. While this is beneficial for owners, the lack of security for employees is troubling. CASPR recommends a 120-day period, then a one year agreement with clear, measurable professional goals.
The opportunity in Puerto Rico is undoubtedly attractive for business owners. Along with these benefits come responsibilities, though. Employers hold the key to the success and sustainability of these incentives. If executives make an effort to employ Puerto Ricans and reward them fairly, as so many Act 20’s do today, all parties will flourish. It will only be a matter of time before Puerto Rico becomes the guiding light for economic reforms around the world.