Compliance Stuff

Takeaways In MCG Therapy Group, LLC v. Maestre Rivera, the Puerto Rico Supreme Court ruled contractual non-compete provisions may remain enforceable following a valid assignment when a contractor’s consent to an assignment is express or implied through conduct. Exclusivity provisions restricting an independent contractor from providing services to third parties during the contract term are valid under Puerto Rico law. Restrictive covenants involving independent contractors are enforceable if they are reasonable and protect legitimate business interests. Related link MCG Therapy Group, LLC v. Maestre Rivera Article In a significant decision for businesses operating in Puerto Rico, the Puerto Rico Supreme Court held in MCG Therapy Group, LLC v. Maestre Rivera , 2026 TSPR 56 (May 28, 2026), that a contractual non-compete provision may continue to be enforceable following a valid assignment of a contract, including in the context of an independent contractor relationship. The court also ...

Takeaways The Puerto Rico Supreme Court’s significant  Tucker v. Money Group  ruling holds that courts must compel arbitration, even for Puerto Rico Anti-Discrimination Act discrimination claims, when the Federal Arbitration Act applies to a valid arbitration agreement. The Puerto Rico court clarified a prior exception to this rule allowing discrimination claims to bypass arbitration applies only to unionized employees covered by collective bargaining agreements, not to individual employees. Employers should consider the importance of assessing whether their employment agreements can be read as affecting interstate commerce and drafting robust arbitration provisions. Related links Tucker v. Money Group, LLC y Otros Quiñones González v. Asociación Puerto Rico Anti-Discrimination Act Article The Puerto Rico Supreme Court issued a significant ruling in  Tucker v. Money Group, LLC ,  2026 T.S.P.R. 9 (Jan. 27, 2026), holding that individual employees who sign valid arbit...

Puerto Rico (PR) OSHA has issued a public notice announcing revisions to the fines and penalties imposed on employers for noncompliance with adopted OSHA standards, effective as of November 3, the date of the notice’s publication. Under the updated penalty framework, willful or repeated violations carry a minimum fine of $11,823 and a maximum of $165,514 per violation. Serious violations are subject to penalties ranging from $1,221 to $16,550 per violation, while non-serious violations carry no minimum penalty and a maximum of $16,550 per violation. Employers that fail to correct a cited violation may be fined up to $16,550 per day until the violation is remedied. Failure to comply with posting notice requirements may result in penalties of up to $16,550. These revised penalty amounts are intended to align PR OSHA enforcement with federal OSHA standards and to strengthen deterrence against workplace safety and health violations in Puerto Rico. The adjustments were adopted pursuant to ...

In  Jack Javier Slim v. Royal Blue Hospitality, LLC H/N/C El Conquistador Resort-Puerto Rico , 2025 TSPR 133, 216 D.P.R. ___, the Puerto Rico Supreme Court held that the non-resident bond requirement under Rule 69.5 of the Puerto Rico Rules of Civil Procedure 32 L.P.R.A Ap. V, R. 69.5, is incompatible with the summary employment proceedings established by Act No. 2 of October 17, 1961, 32 L.P.R.A. §3118,  et seq . (“Act 2”) and therefore may not be imposed on an employee-plaintiff. Act 2 allows labor claims to be heard under an expedited process, in which discovery is limited to the parties. Therefore, the Court emphasized that applying Rule 69.5 in Act 2 cases would undermine the statute’s expedited nature and could result in unjust delays contrary to legislative intent. In the underlying case, the defendant-employer failed to timely answer the complaint and argued that the Act 2 deadline had been tolled while the trial court initially required plaintiff to post a non-residen...

Takeaways Puerto Rico Occupational Safety and Health Administration (PR OSHA) has increased penalty amounts for workplace safety violations.   The new penalty structure ensures consistency with federal OSHA enforcement standards.   Strengthening workplace safety programs, verifying postings, and implementing prompt corrective action can reduce exposure under the new penalty framework. Related Links PRDOL OSHA Public Notice Act. No. 212 of September 17, 2024 Act No. 16 of August 5, 1975   Article PR OSHA recently issued a public notice announcing its updated fines and penalty structure for employer noncompliance with adopted OSHA standards. The updated fines are summarized here:  Nature of Violation Minimum Penalty (per violation) Maximum Penalty (per violation) Willful or repeated    $11,823   $165,514   Serious $1,221  $16,550  Nonserious $0  $16,550  Failure to correct a cited violation  N/A  $16,550 per d...

Takeaways In the wrongful discharge case of  Méndez Ruiz v. Techno Plastics Industries, Inc.,  the Court found an employee’s exhaustion of the 12-month Workers’ Compensation leave is not automatic grounds for a just cause termination. Puerto Rico does not recognize employment-at-will. Just cause analysis is necessary for terminations in Puerto Rico. Related link Méndez Ruiz v. Techno Plastics Industries, Inc. Article The Puerto Rico Supreme Court recently issued a decision reaffirming the importance of just cause for employment terminations in Puerto Rico.  Méndez Ruiz v. Techno Plastics Industries, Inc. ,  No. 2025 TSPR 68 (June 26, 2025). Puerto Rico does not recognize employment-at-will. The Court reiterated that companies must establish the reasons for termination are not arbitrary, capricious, or unrelated to legitimate business reasons . Under Law No. 80 of May 30, 1976, the Puerto Rico Unjust Dismissal statute, employers must have “just cause” for dismissal of...

Puerto Rico Governor Jeniffer González has signed Act No. 29-2025 into law, modifying the  Act to Regulate the Breastfeeding or Breast Milk Extraction Period , as amended (“Act 427-2000”), which provides certain nursing employees the right to time off to express breastmilk. Act No. 29-2025 adds protections to Act 427-2000, preventing employers from taking into consideration the breastfeeding or breast pumping period when evaluating the efficiency or productivity of their employees.  Specifically, Act. No. 29-2025 prohibits employers, supervisors or their representatives from using an employee’s breastfeeding or breast pumping period as grounds for unfavorable performance evaluations or adverse employment actions, including but not limited to reduction of work hours, reclassification, suspension, or dismissal. Furthermore, Act 29-2025 prohibits employers from considering the use of such protected time when evaluating employee efficiency, particularly in decisions related to ra...

  Puerto Rico has recently relaxed its requirements for remote work, implementing significant changes. The first set of changes occurred in 2022 with the enactment of Law 52-2022. In January 2024, further reforms were enacted with the signing of Law 27-2024 by then-governor Pedro Pierluisi. Quick Hits Puerto Rico has relaxed its  remote work requirements  with Law 52-2022, which exempts foreign employers without a nexus to Puerto Rico from making income tax withholdings for employees working remotely in Puerto Rico, provided certain conditions are met. Law 27-2024, effective January 2024, clarifies that nondomiciled employees temporarily residing in Puerto Rico are exempt from Puerto Rican employment laws and contributions, with their employment governed by their domiciles’ laws. Puerto Rico’s new remote work regulations have provided increased flexibility for foreign employers and employees, allowing remote work without the burden of local employment laws and tax obligat...

  On January 14, 2025, the Supreme Court of Puerto Rico had the opportunity to address the “national origin” protected category under the anti-discrimination provisions of Puerto Rico Act No. 100 of June 30, 1959, as amended (“Act 100”).  In   Roberto Jiménez Soto v. Carolina Catering Corp. (Sky Caterers),   the Court held that this category does not include discrimination based on the employee’s citizenship or immigration status. The plaintiff, a citizen of the Dominican Republic and a U.S. legal permanent resident, f iled suit against his employer after being terminated from employment following the expiration of his permanent residence card (green card). According to the plaintiff, his employer unlawfully terminated him due to his national origin because he was perceived and treated as an illegal immigrant. The employer, in turn, alleged that because the plaintiff failed to present a renewed green card, as required by airport security regulations in order to gain ...