Costa Rica, a Latin American country located in Central America has made it legal for workers to receive their compensation in cryptocurrency. According to legal interpretations, the company has a fundamental principle that states that ‘whatever is expressly prohibited is tacitly permitted. This means that in the absence of a law prohibiting the use of cryptocurrencies, in principle it is not illegal to pay wages in cryptocurrencies like bitcoin.
Crypto is not considered as money but quasi money in the country. This means that it fulfils the same purpose as money, but is not necessarily of the same nature. Because of this, there are quasi-contracts,quasi-possessions,quasi-money and quasi-goods that are all legally accepted by the country’s legal regulations.
A lot of cryptocurrency enthusiasts in the country are extremely happy because they believe that cryptocurrency can help to improve Costa Rica’s economy by increasing cash flow in the area. They are also hopeful that this initiative will help in the mass adoption of cryptocurrency across the country. Rolando Perlaza, a Costa Rican lawyer with in-depth knowledge of crypto said,
This is a trend that could take hold in the country.
However, Perlaza acknowledged that even though cryptocurrency is considered as quasi-money it cannot fully replace fiat money for salary payments because the laws are clear that salary must be paid in money. He said,
It is clear that, in Costa Rica, crypto-currencies cannot be used as cash or liquid wages, but remember that here you can pay part of the salary with other goods that are not money or currency, provided that the legal minimum wage is recognised with money.
This means that at least the minimum wage must be paid in fiat currency. If the worker earns anything above the minimum wage, that can be paid in cryptocurrency as well. This is known as wage-in-kind and is similar to paying wages in terms of goods. He said that in the country the laws are flexible enough to adapt to changes such as cryptocurrency, however, there is still a need for a regulatory framework specifically designed for this.
Labour relations and forms of payment, compensation, and benefits evolve day by day, adjusting to the real needs of companies and social actors since legislation, jurisprudence and doctrine must be adapted quickly to their environment, respecting the basic principles of labor law, but without being an obstacle in the worker-employer relationship.
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