Withdrawal from the Labor Capitalization Fund
The Labor Capitalization Fund (LCF) in Costa Rica is similar to unemployment benefits in the United States. Employers make contributions to the fund so employees can receive income in case of future unemployment.
The general rule is that this benefit becomes available after five continuous years working for the same employer, or when a worker dies, in which case the money accrued is paid to the worker’s family.
However, given the current situation in the country, the Legislative Assembly is preparing a bill that will expand the possibility for people to withdraw this savings during the Declared Emergency for the duration of the crisis caused by COVID-19.
If it is approved, people will be able to withdraw from the LCF if they meet the following conditions:
They have been temporarily suspended from their job.
Their hours have been reduced; hence their salary has decreased.
The project also lists the requirements for how to proceed, which would be:
A document provided by the employer certifying the termination of the employment relationship, its suspension, or the application of a reduction in work hours. Said document must contain the grounds (reasons) and indicate the date from which the employment relationship ends, or on which the suspension or reduction of the working person’s work hours.
The applicant must indicate a bank account in their name where the funds are to be deposited. If the applicant does not have one, they must indicate that so the operator or financial entity may determine another means of delivery.
The LCF Operators will have a maximum of fifteen (15) calendar days to transfer the LCF resources to the worker.