The Caja Costarricense de Seguro Social known to most in its abbreviated form as CCSS or just the Caja is out in force to collect money owed to the institution. Many companies owe the Caja money. Some try to play games with the system, so they do not have to pay. Here is a bit of background and a company structure that most expats and Ticos alike do not know about which can be used to avoid the game playing.

The CCSS is the foundation of the social security system in Costa Rica. It collects money each month for itself and various other institutions to cover employee health, death and old age benefits to name a few.

Many companies get behind paying their monthly dues to the Caja. This is causing a severe breakdown of the system which is already taxed by rising health costs in general.

About a month ago, there were protests all over the country by the public complaining about the inefficiencies of the CCSS system and the poor medical care the institution provides in some areas of the country.

Some companies try to play games with the usual system of putting their employees on the payroll to avoid paying social security charges. One of the most notorious ruses is to have an employee provide an invoice to the company so it appears the employee is an independent contractor and not an employee.

There are three basic proofs that make up the definition of an employee in Costa Rica: remuneration, personal service and subordination.

Remuneration means a person gets paid for the work they perform. Personal service means the worker being paid for the services they provide must do the work, they cannot simply replace themselves with someone else when they do not want to work. Subordination means the worker takes orders and must obey them.

One problem with this ruse is that the worker usually does not pay into the CCSS system and thus is not covered by any benefits. In many cases, they do not pay for worker compensation either. That is provided by the Instituto Nacional de Seguros or INS for short. This fact contributes to the financial problems of the whole system and is one of the reasons the Caja is in a financial crisis.

True, independent workers can opt into the CCSS system by paying their quotas as such “trabajadores independientes” which mean independent – or professional – workers. However, if they meet the basic proofs of an employee as listed above, they are not independent and should be on a company’s payroll.

Due to the uproar by the public, Caja inspectors are everywhere trying to find the companies that do not pay and also trying to identify the companies that are playing games with the system.

Some companies like having certain professional workers off the payroll and it is more convenient for them to pay for professional services. Even the country itself has found it more economical to pay for services rendered and keep the payroll down.

For this reason, Law 7407 was created in May of 1994 adding a type of special company structure just for independent workers. It is called a S.A.L. or Sociedad Anónima Laboral. Translated into English this means a company for workers.

This company structure was initially created for companies that work with the government so thecountry could cut costs, but anyone can use it. One example is the phone company, Instituto Costarricense de Electricidad known as ICE for short. It uses S.A.L.s to do contract work like fix telephone lines and install telephone services.

A S.A.L must have at least four workers, and the workers must own the majority of the shares of the company. Outside investors can invest in a S.A.L. but they must remain a minority. If a worker of a S.A.L. leaves, he or she must return the stock holdings back to the company.

Here is how they work: Independent or professional workers constitute a S.A.L. to work with a company or companies. They bill for their work, and then the S.A.L. is responsible for paying into CCSS system and also paying for their workers compensation.

This keeps them off the payroll of the companies they work for and gives them the ability to work independently. The CCSS gets their money, and the companies receiving services do not have to worry about big payrolls.

An interviewed Caja inspector said, “S.A.L.s work well if the people that manage them do not play internal games with the company.” He was referring to the fact that in some S.A.L.s the workers’ pay themselves more than they report to the social security system and do not pay their workers compensation.

A company that has independent workers who are not on the payroll but meet the definition as an employee probably will have problems with the CCSS sooner or later. If these independent workers number less than four, the company should put them on the Caja system and get them workers compensation as soon as possible. If they number more than four and can manage themselves according to Law 7407, they should create a S.A.L and bill the company they are working for to keep in line with the law.

Most people do not know that if they hire a company and that company is not up to date with the Caja Costarricense de Seguro Social, the Caja can collect the money from the company or people to which the delinquent firm is providing services. For example, a security firm might not have all its guards on the payroll or might cheat by not listing any. The Caja has the right to come back at the firm or person who hired the company that did not pay into the system.

The Caja is on a rampage to get non-payers. Everyone, should evaluate the payroll to be sure they are being reported correctly and check to see if the companies they work with on a continual basis are up-to-date as well.

Complimentary Article in PDF Fomat

Today’s employee could be a company’s worst enemy tomorrow. If an employee turns, some will do as much harm as they can to their employer.

There are three important rules to finding and keeping a good employee: selection, training and remuneration. Even after going through a strict selection process, training employees extensively and paying them well, a day could come when they turn on the company.

There does not need to be a particularly good reason for this to happen. An employee may just decide to find another job, move on with their lives or decide they do not want to work anymore. Whatever the reason, many employees – especially in Costa Rica – see easy money by accusing their boss and/or others in their company of mistreatment. Even though this strategy knows no sex, women employees know they can stretch their charges farther than men.

This is due to Costa Rica’s stringent domestic violence laws where women use them to their own advantage to harass — and even steal from — men. The chance of an employer winning in a labor case is slim. A man winning a domestic violence case is also equally unlikely. A loss in a labor case can cost an employer thousands of dollars.

What should an employer do? Employees are usually a necessity in a business. The answer is to do things by the book as much as possible considering the labor laws are confusing to most expats. When in doubt, expats should ask a legal professional. Many of them do not know the answers either. The labor ministry is full of people who can answer questions, but few speak English. The ministry’s new Web site is very good. Many queries can be answered by a visit to http://www.mtss.go.cr/

The best rule of thumb is to have a written set of rules, and if an employee violates one twice, fire him or her the third time. Here is a very important fact to remember. Any fault expires after one month. If an employer does not reprimand an employee for a fault within that time frame, they lose the chance to do so.

Remember, a disgruntled employee will use everything and anything in their power or possession to fight a battle with an employer. They will even make things up and offer false witnesses to testify in a labor case. Judges are more inclined to listen more to an employee than to an employer due to the legal principle in dubio pro operario, or “when in doubt favor the worker.” Keeping paperwork is essential.

Today when everything is on a computer or portable device, an employer must have a plan so an employee cannot steal important company information. This includes, but is not limited to, passwords, financial statements, credit card information and company as well as personal secrets.

Employers should plan for the eventuality that an employee may leave – usually it is more the case when they leave not if they leave – and first and foremost protect company information, especially, the information on computers.

A bad employee can do much worse than simply leave the door open for an office theft. Having the passwords to go along with the data can put the entire business out the door with the computers. Often the critical data can fit easily onto a portable hard drive or memory stick.

Worse yet is when the disgruntled employee is also the company computer expert. A business owner can find himself in a battle of wits with the very person trusted to protect the computers.

One solution to protect data is cloud computing, and while it may not yet be practical to keep everything in the cloud, it is now quite possible to put the keys to the data into the off-site Internet cloud.

Microsoft Bit Locker, a feature of Windows 7, when combined with the right server software, can control computer data even when it leaves the office. Information copied onto an external disk is transparently encrypted so that it becomes totally inaccessible once the employee’s access is revoked.

Businesses can now trust their employees to work from home with sensitive data knowing that it remains safe from theft and can be revoked the minute the employee is off the payroll.

Stolen laptop computers are equally inaccessible, and attempts to retrieve the data directly from the hard disk using other computers or recovery software are impossible thanks to strong encryption.

The key feature that makes Bit Locker work is a Windows Server running Active Directory. While in the past the investment in computer hardware and trained IT staff to support it may have been out of reach for smaller businesses, the Internet cloud now makes it possible to outsource the data keys to a trusted partner.

Protecting a company’s computers in a breakup with an employee is only one area of concern, but one of the most important and should be on the top of the business continuity plan.

Complimentary Article in PDF Fomat

Most expats in Costa Rica have experienced the problem of firing an employee or have one leave unexpectedly. One of the biggest headaches is calculating what is owed to them.

What usually happens is the employee goes to the labor ministry and has the calculations made there. An employer never knows if the numbers are right or wrong. Since many employees exaggerate the truth, the amounts sometimes end up in the stratosphere.

Here is a secret for expats to get a handle on employee severance pay.

First a note: An employee’s pay off varies based on years worked. The more an employee has worked, the more they get in cesantía. This is equivalent to severance benefits. Every employee is entitled to them, if they do their job in a satisfactory manner. The amount an employee is entitled to in vacation pay also varies with time.

Expats usually cringe when they have to make these calculations or call a lawyer to do it for them. Believe it or not, most lawyers do not calculate the amounts correctly either.

The savior is on the Internet located here.

This Web page takes the pain out of employer-employee separation. There is some information on the Web site that is in English, but not the severance calculations, so here is a quick course to use this valuable resource. The process is simple, so just follow this example for an employee:

Go to the Web site. Several boxes are on the page to fill in. They are in groups, the first group is called Tiempo laborado or “time worked.” Type in the date in the box labeled Ingreso. This is the employee’s start date. One can use the calendar, but it may not work on some browsers. If not, be sure to input the date as it is represented in Costa Rican format. For example, the day after Christmas two years ago would be represented as 26/12/2009. The dates are in a day/month/year format. Use this date for this example to see if the result at the end is the same as in this example.

The next box is labeled Salida for the termination date. The employee in this example will lose their job at the end of this month so put 30/06/2011 or use the calendar.

The next group is called Tipo de pago or “type of payment.” There are only two boxes, one is labeled Mensual for “monthly” and the other Semanal for “weekly.” Monthly includes monthly and bi-monthly payments. Weekly includes payments by the week, day or hour. For this example, check monthly.

The next grouping is named ¿Le ha sido otorgado el preaviso en tiempo? This means “Was the worker given notice of termination.” The answer is either SI or NO or Parcialmente for some notice was given. If the latter is the case, put in the number of days the employee was given to look for another job before termination. For this example, check no.

The last group on this page is labeled Días de vacaciones por disfrutar. This means, “How many vacation days does the worker have coming.” For this example, use five.

On the right side of the page — on the top and on the bottom of the calculations tables — in small letters are arrows with the word Siguiente. This means “next.” Click one of the arrows.

On this page there are 12 boxes to fill in. These boxes represent the last twelve months of a workers monthly payments. Fill in the boxes with the correct amounts.

Any in-kind benefits should be included in this amount. In-kind benefits include housing, food, or anything else that fits this definition: Payments for goods or services in lieu of money for labor. The domestic worker in this example is provided lunch by the employer worth 20,000 colons a month. For this example, fill in the boxes with the number 155,000 colons, 135,000 – this is a bit more than what a domestic employee earns according to the labor law – and add the 20,000 of in-kind benefits – their lunch.

Again, on the right side of the page – on the top and on the bottom of the calculations tables — in small letters are arrows with the word Resultado. This means “results,” click one of the arrows.

On the page, the employee is presented the amount of what is called liquidación. To pay off the employee in this example would cost 472,750.00 colons. At today’s exchange rate that would translate into $945.50.

Having employees tends to be a pain. In Costa Rica — as in other parts of the world – the employees are really the bosses of the employers. Going to labor court is expensive, and unless an employer has an iron-clad case they will most probably lose.

The best advice is to have a good labor contract, give written reprimands when they are needed – but no more than two, the third is to terminate. Most importantly, and something most people, not even lawyers know, is an employer only has 30 days to act on any fault of an employee, otherwise, the fault expires.

When one needs to end an employment relationship, this handy calculator is easy to use and very accurate and very few people even know it exists.

Complimentary Article in PDF Fomat

There are several types of company structures in Costa Rica. The two most common are the sociedad anónima and the S.R.L.

However, there are only two types of tax statuses, active and inactive. This fact complicates tax filings for expats and is becoming more of a problem every day due to the enforcement of the country’s new banking regulations. There should be another status offered to filers by the tax department. This status could be called something like “nonoperational,”"static” or “passive.”

Active companies, in theory, exist to make revenues and after deducting legal costs and expenses end up with a profit, which is taxable. Inactive companies exist to hold assets but do not have revenues, costs or expenses. Active companies need to file several types of returns including, but not limited to, sales tax, education and culture tax and income tax forms. Inactive companies only need to file the education and culture tax form each year.

Here is the problem. If a household of an expat has a large domestic staff, it is recommended the employees be on a payroll in the name of a company and not the name of a person. In this case, the company whether it be a sociedad anónima or an S.R.L. has no other purpose but to exist to meet the payroll of the employees. In other cases, all the expenses of the household are paid out of the inactive company.

This is not really an active company using the rules of the tax department because the company does not have revenue. However, it is not an inactive company either because the payroll of the employees are, in theory, expenses for the company.

All companies have accounting requirements, whether they be active or inactive. In accounting there are always debits and credits.

Now in a company that is active revenues are received to pay the expenses. But where does the money come from to pay the payrolls and other household expenses in a company that has no revenues. Well, it comes from the owners of the company but not as revenues but as loans or capital inflow.

On tax returns, this kind of company will never have a profit, only losses. However, the tax departments still wants all the forms filed each year as if the company is active. This includes form D-151 and D-101. In the past, the tax department was not very careful in auditing the D-151 form. This form is an informational document that is filed by active companies as a cross checking mechanism to catch tax cheaters. The tax department was trying hard to make the filing of this form a quarterly endeavor, but after a big fight, it remained an annual filing due Nov. 30 of each year.

Now, the tax department is doing a much better job checking the D-151 form and even in companies that exist only to pay employees or other incidental expenses need to file this form. Recently, an expat couple was fined heavily because they did not file the D-151 form. They also were using their company to pay their telephone bills as well as their employees and did not report the expenses on the form.

Here is the other problem. In the past most expats left these kinds of companies as inactive but had bank accounts open to pay the bills. Most

banks in Costa Rica are updating their records due to new banking regulations. One of the many requirements to have a bank account is to submit a form proving the company is an active company. This fact means that an inactive company with a bank account will be closed by the bank unless the owners of the company go to the tax department and signs up as an active company. Once the company is active, all the other forms need to be filed or fines, and penalties will result. In addition, once a company is active, it also needs to keep a set of books, including accounting, which can be inspected at anytime by the tax department.

The good old days are gone where managing a company and maintaining a bank account was easy. Now days, it requires a lot of work and probably the services of an accountant. If many expenses are being paid out of one of these companies, an accounting program to keep track of the information needed to fill out the D-151 return will probably also be necessary.

It would be nice, but probably is only a pipe dream and will not happen, that the tax department start another tax category other than active or inactive which would facilitate the use of a company structure to pay payrolls and expenses of an activity that does not produce any revenue like a domestic household.

This would ease the tax filing requirements on expats on these kinds of companies and also alleviate the big headache of opening and maintaining a bank account. As it stands today, if an expat currently has a bank account for a company that is inactive, it will probably be frozen or closed shortly unless the owner makes the company active.

Citibank is currently in a major updating process and calling all of their customers to come bring their accounts up-to-date. Customers are being told that if they do not do so immediately, their bank accounts will be frozen, put in an inactive status, or closed.

Complimentary Article in PDF Fomat

Here is some great news for green-minded expats.

The Costa Rican tax department required all tax contributors to keep their account documents for five years and their accounting books up-to-date at all times. This meant gobs and gobs of paper and sufficient storage places to stash all the stuff. Not very green thinking.

In a country that pledges to be carbon neutral by 2021 — different politicians have used a variety of different pledge dates — not allowing companies to digitize their accounting was insane.

Until the very recent past, that was the rule. Everyone needed to keep all their accounting in boxes to support what was reported to the tax authorities. Well, good news, a recent request for clarification to the Ministerio de Hacienda, the mother organization of the local tax department found that according to a resolution DGT-02-09 from the Direccion General De Tributacion, dated Jan. 9, 2009, people can keep electronic documents and forget the paper.

The only two major requirements set forth by the tax department are that individuals and companies electing to keep their documents digitally must guarantee the documents cannot be altered by others. This means good security measures to protect the documents must be in place. Also sufficient backup procedures also must be maintained.

This may sound real simple in theory, but it is not in practice. Most people are lax in both areas. Many do not keep their computers up-to-date with the latest virus and firewall software because it costs too much money. In addition, people know backups are important but just never get around to putting a good backup system in place.

There is no excuse for not doing either. These days there are a multitude of free virus and firewall programs available and they sometimes rival programs one can purchase. Backup systems have come down in price drastically, and most backup equipment is designed for computer neophytes or, better stated, the downright computer dummies of the world.

Yes, granted, most of the accounting source documents an individual gets is on paper. Cash register tapes, invoices, cash receipt forms, credit card vouchers, and the list goes on and on. Many of the papers received in Costa Rica one cannot even read because they are printed on paper with microscopic printing or printed with a printer that has not had a ribbon replacement for years.

None the less, this paper can be recycled if it is digitized instead of stored in some storage area for years and years. Better yet, the mentality of people is changing. One now can request their light, water and phone bills digitally by having them sent to an e-mail address. Once received, the bills can be paid online and the bill and payment can be put in a digital filling cabinet without ever printing a piece of paper.

For novices to this digital world, the best digital filing system for Windows operating systems to store documents is made by Nuance — once called ScanSoft — and it is called Paperport. This program is easy to install, easy to use and comes free with many scanners.

Newer cellular telephones also make excellent expense-capturing devices. One just takes a picture of an accounting document and using the telephone e-mails the photo to oneself for accounting.

Most newer accounting systems today have incorporated ways to attach digital documents to transactions. Two of the best are Quicken and QuickBooks 2010. Intuit’s Quicken and QuickBooks products have been around for years. A newer company, called NeatReciepts, is great for individuals who are looking for something very simple to use for their expense tracking and document archiving.

The secret for everyone is to “think green” and use the new Costa Rican tax law change to improve and protect the environment. Thinking green is hard at first, but it gets easy real fast because people working green save money. They do not buy as much paper and they do not have to pay for those outrageous printer cartridges or laser toner refills.

Here is one example of green thinking and an accounting trick to avoid printing paper. Request all utility bills to be sent online to an e-mail address as mentioned above. Pay the bills using online banking, but when the payment receipt screen appears, do not print it. Use a function on everyone’s computer, called “print screen” or “Grab” and send the receipt directly to the computer and not to a printer.

The transaction can be posted to an accounting system like Quicken or QuickBooks and the bill and the payment receipt can be attached to the record. So no paper printed, and the tax department states this is 100 percent acceptable.

There is an added benefit for expats and people in general that think and live green. They do not have to lug accounting stuff around. It makes them more mobile. Everything they need to work and play in Costa Rica or in any other part of the world can be kept on a computer and backed up to a multitude of online sources. The data can be encrypted to keep it out the reach of prying eyes.

Green thinking is good. It saves money, makes one more mobile. It is good for the environment, and, best of all from a legal perspective, it complies with the law. The surprise is that it took environmentally conscience Costa Rica so long to come up with a rule allowing for digitizing documents.

Complimentary Article in PDF Fomat

Having a business — despite the effort, paperwork and bureaucracy — can certainly pay off. A small entrepreneur may dream about earning so much success that the local business goes global and becomes a landmark around the world.

However, do schools in Costa Rica teach future business owners that what pays them is their clients’ preference? And if they do not go to school for business, do owners forget they have been keeping every business they have visited open by being a client there and that the success of their business depends on their customers’ satisfaction?

Although it should be almost instinctive to think of customer service as the most inherent component to any business, Costa Rica has a long way to go, not only in providing clear and timely customer service policies, but also in educating its citizens to demand the satisfaction their money is paying for.

Latin American countries are not famous for providing customer satisfaction, and that varies from culture to culture (including exceptions), but they have always been a few steps behind developed nations. However, culturally, why do most Hispanic nations share the notion that when one has a business, suddenly one gets to run the show, and the peskier one gets the more business-like one appears? Well, some possible answers come to mind.

First of all, coming from a Catholic-colonized background, these cultures have been educated to obey anyone who seems powerful. Business owners are looked at as authority figures, as more important people than the average person. Owners and managers are treated with the same admiration and respect as priests, nuns, pastors, ministers, deputies, presidents. Therefore, when Latin American consumers face unfair, insulting treatment by any business in town, their instinctive response has been to quietly take it gracefully (as social subordinates), and never complain.

Secondly, many Hispanics, especially Ticos, are afraid of drawing attention to themselves. They tend to be shy, passive and nervously friendly people. Standing up for oneself is culturally frowned upon in Costa Rica; people who stand their ground are usually labeled as negative, confrontational, dramatic and even spiteful.

Besides avoiding scenes, Ticos are masters of hypocrisy. They can fool anyone with their nice tone and smiles. They would rather act behind the scenes than gathering the courage to be upfront about issues with people.

Therefore, Costa Rica has become a paradise for sneaky, abusive and fraudulent businesses that are still going strong, to the point that almost no establishment is safe from complaints.

The saying, “the customer is always right” seems to be the one motto missing in the training programs for customer service positions at any workplace.

Another theory might be that Ticos employed for assisting clients simply got the first job available, even if they were not qualified for it. One would think that any sensible business owner or manager would find out enough information about a prospective employee before trusting them with such a crucial position for their business, but just like so many other aspects of Costa Rican culture that seem to run backwards, owners do not care or value customer service providers in their establishments. It is actually one of the worst paid positions in any company, which would explain the last possible theory: customer service providers are so unhappy about their working conditions that they get theirs by taking it out on the customers, hopefully contributing to ruin sales.

Costa Rica seems to be waking up from its passivity. Once Costa Rica started getting acquainted with customer satisfaction policies — assuming it happened gradually due to the booming growth of U.S. companies in the country — the Ley de Promoción de la Competencia y Defensa Efectiva del Consumidor – N° 7472 (competition promotion and effective consumer protection act) was created Dec. 20, 1994. However, extensive informative campaigns concerning its regulations and services have never been implemented, and it still keeps many consumers in the dark about what to do if they become victims of unscrupulous service providers.

For that reason, a small group of conscientious journalists, among them Hazel Feigenblatt, Armando Mayorga, have decided to create their own blogs online devoted to posting customer complaints about treatment in banks, restaurants, appliance stores, cable companies, governmental companies, transportation, scams, among others. Ms. Feigenblatt even has a page for English-speaking customers. Interestingly, most consumers rant about their experiences in detail in the blog site, but admit not expressing their dissatisfaction or demanding better treatment to service providers while it was happening. Despite that, Ticos’ perception of clients as subordinates is definitely changing, and they are learning that customers are actually the ones who run the show.

Although there are extensive reports about most establishment categories, anomalies experienced at banks and restaurants top the list. The following are some of the most outrageous situations people pay to suffer daily in Costa Rica, according to the complaints registered by the consumer protetion Web sites:

Banks

Unnecessary long waits. Customers have reported waiting up to four hours for a simple transaction in public banks, mainly due to having less than half of their staff working. Long lines are also true for some private banks.

Administrative mistakes never or reluctantly resolved. Some managers or supervisors often excuse clerk’s mistakes like depositing wrong amounts, giving back wrong receipts, applying unjustified withdrawals, giving or offering deceiving information to get clients to sign contracts or pay unnecessary, non-refundable fees, among others. Besides standing by clerks’ incompetence, they even dare to blame clients for not paying attention at the situation. Others opt for playing the fake customer-service card by apologizing, making countless promises and then cowardly avoiding follow-up calls and ignoring e-mails.

Ridiculous commissions and interest rates. While some public and private banks are famous for charging commissions as high as $7 for print-up statements, others randomly raise the credit interest rates up to 30%.

Discrepancies with infamous Law # 8204. Following governmental efforts against international and local fraud/laundering, banks recently launched publicity campaigns for updating personal information in bank account records, and have been punishing customers who fail to comply by closing their accounts.

However, the most serious aspect of this law is that it does not mention or describe the rights or duties of people who do not work and still have bank accounts (students, wealthy people, housewives, etc.).

The law grants banks the liberty to decide what to do with the accounts of unemployed customers, and not surprisingly, those people are being told by banks that they cannot fill out the form required by the Superintendencia General de Entidades Financieras (SUGEF) to update their data, and will have their accounts closed as a result.

Banks are only servicing customers who can abide by the new law. What upsets several customers is that the law is being imposed on every account holder, not only on suspicious ones. Besides being a waste of time, paperwork, and bank resources, they feel that banks are treating all clients as criminals until proven otherwise, instead of striving to select and apply the law only on suspicious ones and keeping the rest happy.

No security guards past office hours. Complaints about how easy banks make it on criminals that commit paseos millonarios (mugging people and taking them to different ATM vestibules to empty their bank accounts) on their customers by not having one security guard at their offices after hours. Many people have fallen prey of this type of crime, and several have even been killed. Banks eventually opted for closing automatic teller service at 10 p.m., but that has only made criminals operate earlier (a woman was attacked and robbed at 7 p.m.)

Restaurants

Bugs and hair in food. As insane as it may sound, cockroaches have been found cooked and fresh several times inside served food at renowned restaurants. Flies were also found in cheese and chili containers, and a long hair was found inside a pizza. It needs to be said: do any of the bug-infested restaurants know how crucial fumigating food-service establishments is for their prosperity? There are plenty of exterminating companies that use eco-friendly substances safe for kitchens. They do not even need the staff to evacuate. Therefore, no excuse is viable for not fumigating a restaurant.

Questionable promotions and fraud/stealing. Misleading information about promotions as well as low quality in promotion dishes are common complaints, and credit card fraud and plain stealing from clients’ purses by staff members have been reported at some restaurants.

Bad food. Old, sour coffee and slightly decomposed lasagnas were reported at one prominent outlet.

Long waits. Long lines are common complaints about fast food restaurants, as well as regular restaurants, even when food has been sent back.

Rudeness, homophobia. Whether it has been rude treatment, bad food, long waits or bugs in food, one aspect most restaurants share is their lack of apologetic effort. Apparently, some waiters and delivery people are trained to put on an uncomfortable facial expression, walk away silently or respond rudely when atrocities are pointed out to them. A pizza chain’s staff recently was reported as mocking, ignoring and insulting gay customers for which they subsequently apologized. The company promised to include human relations in the staff training.

Specifics of the various accounts and the names of the outlets are listed on the Web sites. However, A.M. Costa Rica cannot substantiate individual complaints.

Customers do have legal options when experiencing abuse from businesses. After the 1994 consumer protection act was created, the Ministry of Commerce added the Comision Nacional del Consumidor (a national consumer commission) to its jurisdiction, in charge of receiving, processing and penalizing consumer complaints. According to the agency’s Web site, reporting steps go as follows:

1- An unhappy customer can contact the agency toll free at 800-266-7866, at consumo@consumo.go.cr, and at fax number 2284-8821 for specific instructions and information about the complaint.

2- According to the recommendations received during step 1, the consumer may be asked to visit the agency office (Avenida 3, between calles 30 and 32) with a detailed written complaint, along with the following documents: receipt / car-repair slip / contract / warranty, full name of the reporting person or company as well as a physical address where to notify them, and any other relevant document.

The Web site states that resolutions may take from 30 days up to two months, depending on the type of complaint. However, consumers have also been complaining about the lack of efficiency of this institution, from never answering the toll free line to never resolving cases. The staff seems to only follow up on high-profile complaints. Despite the latter, the commission has processed a considerable amount of complaints and penalized several companies since its foundation, slowly changing the customer service landscape in Costa Rica.

Other entities where consumers can report abuse are Defensoria de los Habitantes and Autoridad Reguladora de Servicios Publicos. The Poder Judicial is in charge of serious cases that include suing for damages, and consumers must have acquired legal representation prior to visiting their offices.

Since all institutions listed above conduct all procedures in Spanish, translators will be required for expats who are not bilingual.

An effective initiative to make businesses strive for excellence is to have them compete for a spot on an A-List of the best rated businesses Denver Channel 7 maintains such a list on its Web site for its community and rates viewer experiences in different city establishments weekly or monthly. Surely, that will keep service providers on their toes, and customers healthy and happy calling the shots.

Complimentary Article in PDF Fomat

Being an important expat destination, Costa Rica offers great weather, beaches and plenty of rainforests, and it can be, bureaucracy and all, a good location for expats who want to grow their businesses. However, there is a group of expats who not only do not own businesses but also need to make ends meet. They get to know a very different kind of jungle: Costa Rican workplaces.

Common employment for expats or foreigners looking for a temporary Costa Rican experience include English teaching, sales and customer service at sportsbooks, casinos, other call centers and real estate firms. Jobs in tourism are the fewest, and they usually require applicants to speak fluent Spanish. In addition, some expats or foreigners seek to get hired or, if popular enough, get requested for cultural activities, especially in the music scene.

In many interviews with expates about their employment experiences in Costa Rica, there seems to be some common denominators in Tico workplace environments. Aiming to set the record straight – unlike many sites that sugarcoat everything about this country – the following are some of the most important ones.

Contract discrepancies. Expats who get hired in jobs whre employers do not require work permits should get paid the full amount offered during the interview. Too often companies wait until it is time to pay the first salary to fast-talk foreigners into believing they are required to pay 9 percent of their salary as government withholdings because of immigration scrutiny. This constitutes employer fraud. Employers can only deduct 9 percent of salaries from employees who are registered in the Caja Costarricense de Seguro Social. The social security agency in Costa Rica is commonly referred to as the “Caja.” That percentage goes directly to that organization. If employers are deducting the withholdings from unregistered employees, they are keeping the money, plain and simple. They cannot send those percentages to Caja because they would be questioned as to whom that money corresponds, nor will they be exempt from a hefty fine if they are caught employing illegal workers, even when deducting the monthly amount. Expats should ask about this aspect during their interviews, and address their knowledge on the matter.

Other complaints have to do with hours promised vs. hours offered. This is especially true for English teachers. Many report being promised full-time schedules and only being given a fraction of that once they sign six-month to one-year commitments with deceiving schools.

Payment irregularities. This seems to be the aspect drawing the most resentment from expats. Some state they applied for jobs that advertised salaries in dollars to then find out that their first salary was paid in colons. Even if they always had the option to quit, some of them decided to endure their jobs, always worrying about converting their monthly payments to dollars to make sure they reflected accurate exchange rates.

Payment delays are also very frequent, especially in sportbooks or casinos. Expats have reported up to a week’s delay in getting their salaries, always being told bogus excuses by their employers about having problems with bank transfers. The ironic thing is that most call center employers are expats themselves, but they have adopted hora tica (Tico timing) when doing business.

Unannounced, gradual salary cutbacks have also been reported. This aspect is frequent in places where salaries are paid under the table. If management decides to start cutting back on commissions or salary amounts that were initially promised, employees have no way to legally protect themselves.

Lying about payment amounts or payment at all also seems to be common in contracts concerning the music scene. Foreign disc jockeys who are hired in local bars complain about how often they have to address problems with the amount they get paid compared to the one offered, which is also true for foreign performers. Some music concerts have been cancelled, even once the audience has arrived to the location, due to payment disagreements between foreign artists and event organizers. Fans have even vandalized facilities once they find out they are not getting their money back either. Expat disc jockeys who aim to get jobs at radio stations say it is good exposure, but forget about getting paid.

Some of them were lied to during job interviews at different stations, being told that once the ratings were received, they would sit down to discuss compensation. Instead, they were given the runarounds by employers once it was time to discuss payment and when some pressed the issue, they were magically taken off the air. Others opted for sucking up to the station and were able to get full-time administrative jobs that would give them monthly salaries ranging from only $300 to $400.

No degree recognition. Costa Rica may be the education diploma paradise for Ticos, but not for expats. Costa Ricans know the more degrees they obtain, the better they will do professionally and financially. That is why there are so many Ticos enrolled in master’s degree programs and short-term trainings that will give them some kind of certificate or diploma. Those open doors. However, expats rarely share this advantage. Expats with bachelor’s degrees do not get better salaries compared to Ticos who have no college education for call center jobs or travel agencies.

The same happens with post-graduate degrees. English teachers who have master’s degrees or Ph.D.s do not get better salaries or positions in language schools unless they have mastered Spanish as well. Ticos do not seem to recognize professional achievement unless it is spoken in their language. Most expats do not even get it until they are residents. Therefore, foreigners with higher education usually end up founding their own language schools in order to put their degrees to good use.

Crazy work ethics. Although this aspect can be true of any office around the world, at least it is true that in Costa Rica it is the one thing you can always count on in the workplace: From increasing daily tasks with no corresponding raise to blatant favoritism reflected in treatment and unjustified raises from management to certain employees, Expats describe Tico office environments as an indoor Wild Wild West. Even though labor code violations are penalized, and the court usually rules in favor of the victim, work ethics that cannot be evidenced in paper are hard to prove in court. There are many cases of sexual harassment, sexism and verbal abuse that go unreported as well.

Concerning the Costa Rican music scene, anarchy seems to be the rule. Many expat and visiting musicians claim that event organizers, bar owners and promoters leave everything for the last minute, provoking embarrassing interruptions or performance delays due to their negligence concerning sound or equipment quality.

No professionalism. Costa Ricans holding an authority position anywhere seem to think that supervising or managing equals patronizing. Tico employees appear used to being disrespected by their employers or supervisors, but foreigners are not. However, Ticos who are not internationally educated treat foreign employees the same way they treat their own. They could have older expats under them, and they still scold them as if they were children. What they also ignore is that most foreigners will hold their own and put them in their place, which sometimes has resulted in unfair firings, since disrespectful Tico supervisors are usually backed up by companies due to their opportunistic skills. Some expat supervisors are not exempt from being jerks, but they usually patronize Ticos, not fellow expats.

Physical contact and no personal space. Costa Ricans have a very physical way of relating to others. Expats often complain about having to kiss Tico co-workers of the opposite sex on the cheek every morning, even the ones they do not like, as Ticos do among themselves. Many expats also feel Ticos have no sense of personal space, since they usually get too close to walk by or talk to them.

No political correctness. Ticos do not know what the term politically correct means. There is no equivalent for that phrase in Spanish either. Costa Ricans feel free to make ignorant racist, sexist, homophobic and ageist jokes in the workplace, disregarding the feelings of those around them. They also feel free to openly discriminate against others based on race, ethnicity or class. Many expats still cannot get over that aspect, especially because it is legally and culturally allowed.

Moving to any foreign country will always need some kind of adjustment, but most relevant information about what to really expect in Costa Rica is unavailable, and most Ticos do not want to have certain aspects of their culture revealed abroad. They need to keep Costa Rica’s reputation intact, and so far it has been working. Until now.

Complimentary Article in PDF Fomat

Costa Rica is labeled a paradise by many sources on the Internet: by visitors who describe their great trips in online blogs, by travel websites trying to entice tourists to visit and websites offering general information about Costa Rica’s nature, history, culture, and the like.

Too many — especially young people — take the bait and move to Costa Rica thinking they’re going to earn big bucks teaching or by working in call centers. Only they get trapped earning very little and what they do receive is easily consumed by living expenses.

Surprisingly — if not suspiciously — bad reviews about this so-called Central American Switzerland are sometimes hard to find, but digging deeper into the Internet pays off to get the true story. Most sources offering a realistic — and far from paradise — view of Costa Rica are foreigners who felt tricked into believing all the heavenly reports about a country that basically hit them with a harsh reality once they had already moved in.

It turns out that the most wonderful features of Costa Rica can only be enjoyed by tourists. Except for jobs offered in beaches — which all got perfect reviews — foreigners interested in trading their own country for a San José way of living have a much less idyllic view of their surroundings.

Besides tourism, Costa Rica is increasingly becoming an employment attraction, especially for college students who want to spend a couple of months abroad while making some money. The two main industries employing foreigners are English language schools and call centers.

Most people looking for a change of scenery get lured with all they read in the Internet, given that there are virtually no bad testimonies online about living or working in Costa Rica. Most Web sites on those topics say things like, “…there are plenty of jobs in Costa Rica for Westerners . . ” or “. . . if you are fluent in Spanish and English, then you can obtain many more jobs.” In reality, while there are some jobs, there are not plenty like the Web claims.

Although language schools are always looking for foreigners, most of them require teachers to have teaching certificates such as TESOL, ESL, TEFL or CELTA, which are an expensive investment, costing $2,000 if obtained in Costa Rica. Moreover, luck plays an important role in finding a school that will pay and treat an employee well. Most schools paint a prettier picture than what they actually offer. Some of their employment ads read “highly competitive hourly wages and full-time salary positions” when they actually pay no more than $8 an hour. They say “free private transportation to out-of-office locations” when it is free only from the teaching location back to the language school, not to the teacher’s residence. Some charge a fee for that extra service after late-night classes.

Some schools also offer “flexible hours up to 40 per week” only for teachers to find out that they only can get up to 20 hours a week. It is common to find schools that hire more teachers than they need in case some decide to leave. So, a lot of teachers are left with a fraction of the time they were offered in the interview or training. There is even a school that claims the most hours teachers can aim for is between 8 and 12 hours a week: “Not one English school can give you a guarantee of more than that. If they do, they are lying to you.”

One Web posting says “if we don’t have your schedule filled to at least 12 hours, then we don’t blame you if you look for a second company/school to help with your income!”

That is an aspect never mentioned in any of the school sites. Working for at least two language schools is a really difficult task. Most schools offer classes at similar hours because students tend to schedule them between 4 and 6 p.m. Teachers must take into account that language schools are not within walking distance of each other. Some trips even require taking two buses and spending an hour, depending on traffic jams. Or a teacher can take a taxi with a $5 to $7 cab fare, equaling an hour of payment in most schools.

Foreigners will find it too complicated and sometimes impossible to juggle two schools at a time. Yet, due to necessity, some eventually get into crazy schedules such as teaching at 7 a.m. (when they are lucky to find schools offering those schedules) and then teaching again in the evening on weekdays, plus all day Saturdays. This type of daily commitment leaves no time and very little money to explore Costa Rica.

Financially speaking, at least one school website was honest about this matter, saying that Costa Rica is “not a great place for a person trying to make a lot of money teaching.” Teachers can expect to earn from $400 to $700 a month, but there some rare exceptions of full-timers who find a good place and can earn up to $1,500.

Since most schools employ teachers under the table, they pay in cash or have an agreement with private banks to open accounts for their employees to deposit their salaries. Some schools have a deal with immigration authorities to let their employees work while providing them with free Spanish lessons. Others promise a temporary work permit that must be renewed every year. That costs $250, which is covered by the schools, but if the teacher quits or gets fired before the contract term ends, they frequently have to reimburse the schools the permit fee.

Another aspect to consider is that many foreigners end up quitting after a short time of being employed because they want to travel or get discouraged. For this reason, many schools are now requiring between four and 12 months of commitment, which can be inconvenient for teachers who feel tricked into taking a job at a school that does not honor its promises.

In sections for frequently-asked questions of some language schools, when asking why they would want to come and get a teaching job, there are responses like “highly motivated students, the fantastic climate, and beautiful places to explore” or “Safety of a foreign government that has no military.” These statements are highly misleading.

First, local students are rarely motivated to work hard at learning a language. Most think that by paying for lessons, their teacher will somehow telepathically transfer them language fluency and vocabulary. Thus, a lot of teachers lose motivation because the lack of effort from students makes class flow virtually impossible, and they end up going over the same mistakes to only be blamed for failing students at the end of the term.

Second, it rains copiously almost every afternoon and evening from May to December, making it very uncomfortable for anybody who is commuting between buses. They get at least their feet soaked and have to teach wet until they get home, making them prone to getting sick.

Third, a country with no military does not equal a safer country but a system with less control or accountability. The crime rate goes higher by the day in Costa Rica, and as an expat expressed it, “You will never see so many security bars around houses and guards outside stores and banks with loaded shotguns in any other country.” Foreigners are walking wallets to local criminals, which makes them a favorite target.

For a good list of language schools, visit the eslbase.com website.

International workers have more chances of getting a lousy teaching job than getting one at a call center, unless it is in a sportsbook or casino. There is limited access to the call center industry, especially now that immigration authorities have a more strict surveillance of the operations. Some places are accepting only foreigners with residency, giving more job opportunities to Ticos.

A Web site stated that “. . . the most popular and best paid jobs in Costa Rica for English speakers can be found in call centers.” However, in reality call centers used to pay really high salaries, but due to the increase of English-speaking Ticos, monthly salaries now range between $600 and $1000. Only a few poker places or sportsbooks are still paying over $1,000. They pay in cash or through opening a bank account through them, but many foreigners complain about payment delays with lame excuses given by managers, and lack of professionalism in the workplace.

Call centers seem to offer more convenient schedules, although many operate on weekends and allow only one day off, making it impossible for foreigners to travel around Costa Rica. Some are flexible for requesting time off, but it depends on the place. Jobs in tourism are not in high demand, and they require foreigners to speak fluent Spanish. Plus, salaries are not great, ranging from $600 to $1,200. The same is true for real estate positions, which mostly work on commission and require employees to own a car.

Expense consideration is crucial when deciding to take a job in Costa Rica. The cost of living can amount up to $1,000 a month for one person. Rent is no less than $300 (unless shared with one or two roommates) for a livable apartment, but it can go up to $600 for a decent place, plus $100 in utilities. Food and groceries are really expensive due to importing taxes, since there are only some locally produced items. The cost of groceries can be as high as $500 a month for 2 people, and restaurant meals are no cheaper than $3. Transportation by bus is approximately $20 a month, and cab fares are no less than $1 a ride. Appliances, clothes and accessories are all taxed, but clothing can be found on sale often.

Culturally speaking, Costa Rica does not offer many options in terms of nightlife or daytime entertainment. Foreigners who like urban excitement will not find it in this country.

Of course there is the occasional dream story of people who came here to visit, found their niche, partnered or built a business and became prosperous, making them permanent and happy residents. But those people usually live by the beach and got really lucky. These cases are the exception, not the rule.

The ugly truth is most foreigners moving to Costa Rica to work find it hard to make a living here and wish they would have stayed home.

Complimentary Article in PDF Fomat