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Policy Setup

Incapacity Policy Setup

The Incapacity Policy is a single per-Tenant Configuration record that controls the annual sick-leave allotment, the number of employer-paid waiting days per cause, and the employer/CSS pay percentages.

Where to find it

Go to Payroll > Incapacity > Policy.


Policy fields

Field Description Legal default
Annual Days Total employer-paid sick-leave days per calendar year 18
Common Illness Employer Days Waiting period for common illness before CSS kicks in 3
Occupational Risk Employer Days Waiting period for occupational risk 0
Maternity Employer Days Employer-paid days for maternity incapacity 14
Employer Pay Percent Fraction of daily base salary employer pays during waiting period 50% (0.50)
CSS Subsidy Percent Fraction of daily wage CSS pays after the waiting period 60% (0.60)

Art. 199 CT: The 18-day minimum and 50% employer pay rate are set by law. You may increase either value for enhanced employee benefits, but you cannot set them below the legal minimums.


Setting up for the first time

  1. Go to Payroll > Incapacity > Policy.
  2. Confirm the Annual Days (default 18). Increase only if your employment contract or collective agreement specifies more.
  3. Review the per-cause Employer Days settings. The defaults match Panama law - only change if your policy differs.
  4. Confirm Employer Pay Percent (0.50 = 50%) and CSS Subsidy Percent (0.60 = 60%).
  5. Click Save.

The policy applies to all future certificates. It does not retroactively change the split on approved certificates.


Per-cause waiting days explained

Common illness (3 employer days): The employee must miss at least 3 working days before CSS assumes the subsidy obligation. The employer pays 50% of daily salary for those 3 days, then CSS pays from day 4.

Occupational risk (0 employer days): The employer has no waiting obligation. CSS (or SIPE/occupational insurance) covers from the first day. The employer records the certificate but makes no sick-pay disbursement during the incapacity.

Maternity (14 employer days): The employer pays 50% for the first 14 days. CSS pays the remainder of the medically certified maternity incapacity period under Ley 59 de 2005.

Occupational illness (0 employer days): Same as occupational risk - employer waiting period is zero.


AffectsIncapacity flag on Payroll Concepts

The incapacity daily rate calculation uses Base Salary only by default. If your company includes other cotizable earnings in the incapacity base, you can flag additional concepts via Payroll > Payroll Concepts > Affects Incapacity. This is uncommon - confirm with your labor attorney before enabling.


Annual Reset

The balance resets on January 1 each year (configurable via policy). See Annual Reset for details on how partial-year hires are handled.


Related: Overview - Certificate Intake - Payday Split - Annual Reset - Payroll Concepts

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