Dominican business sector rejects proposed Labor Code reform

Santo Domingo.- The Dominican Republic’s business sector has expressed strong opposition to a proposed reform of the Labor Code, approved in its first reading by the Senate. According to a joint statement signed by 85 business associations, the reform represents a setback rather than a step toward modernization.

“Far from updating the legal framework, the approved text ignores key agreements reached over years of tripartite dialogue,” the statement reads. Business leaders argue the changes undermine the balance and sustainability required for economic growth.

Among the main concerns raised:

• Increased labor costs: The reform would significantly raise labor expenses, with no consideration for micro, small, and medium-sized enterprises (MSMEs), which make up more than 98% of the Dominican productive sector.
• Job creation disincentives: In a country where informal labor already accounts for over 55% of the workforce, the new rules could discourage formal job creation and hurt ongoing efforts to formalize businesses.
• Judicial burden and legal uncertainty: The proposed changes would overload the judicial system, increase legal uncertainty, and weaken the investment climate needed to attract both domestic and foreign capital.

“This reform sends a negative signal at a time when the country is facing global challenges that demand stability, trust, and long-term vision,” said the statement. “We insist that any labor reform must come from a broad, participatory process based on solid technical studies that assess the economic and social impacts.”

Leading signatories include:

• The Association of Industries of the Dominican Republic (AIRD)
• The Dominican Association of Free Zones (Adozona)
• The National Association of Hotels and Tourism (Asonahores)
• The Employers’ Confederation of the Dominican Republic (Copardom)
• The Dominican Confederation of Micro, Small and Medium Enterprises (Codopyme)
• The National Organization of Commercial Enterprises (ONEC)
• The Association of Multiple Banks of the Dominican Republic (ABA)
• The National Council of Private Enterprise (Conep)

The proposal will now proceed to further legislative review, but the business community has called for immediate dialogue and a reassessment of the bill’s implications before it advances any further.