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(506) 2223-1327           Published Monday, Oct. 17, 2011, in Vol. 11, No. 205       Email us
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Special setup lets employers duck Caja collectors
By Garland M. Baker
Special to A.M. Costa Rica

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 the
Caja collector

country 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.

Garland M. Baker is a 39-year resident and naturalized citizen of Costa Rica who provides multidisciplinary professional services to the international community.  Reach him at  Baker has undertaken the research leading to these series of articles in conjunction with A.M. Costa Rica.  Find the collection at, a complimentary reprint is available at the end of each article.  Copyright 2011. Use without permission prohibited.

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Our readers' opinions
Occupy movement needs
to be covered by media

Dear A.M. Costa Rica:

We have a movement that needs the attention of the media just like any movement.  I totally agree with most of them that the corporations have taken over.  We need to cover the issues being represented in the movement.

These are people who have lost their jobs and many times their homes.  These people are from all walks of life.  They are trying to wake people up to the harm that has been caused by the crisis.

The world needs to realize that we need to see what is happening here and a blackout from the media just gives more credence to the cause.  Media is bought and paid for by the elite.

If we do not allow these alternative voices to be heard, we should be worried.  Global voices should be heard.  The world has been taken by the bankers and by corporate greed.   We can no longer stand by and pretend everything is okay.

I only hope this can stay peaceful.  The Roman citizenry Saturday showed how violence does not get the proper attention and nor should it.

Support the people that can speak out against the corporate greed.  We have plenty of it here in our own backyard.

Debora Edholm

Profit-oriented firms won't
think twice about moving

Dear A.M. Costa Rica:

The proposed taxes on the tax free zone will cause a huge loss of jobs for Costa Rica. Costa Rica thinks that companies will stand for new taxes while forgetting that these companies are controlled by stockholders. Stockholders will do whatever needs to be done to protect their investments and their profits.

Those taxes, utility costs come out of their profits/pockets. They did not invest in Intel or any other business to help Costa Ricans and their problems. Costa Rica will make a mistake in thinking that the business can’t afford to move their multimillion dollar investment in Costa Rica. They are wrong. Intel and others not only will look at the increase in costs/loss of profits but how much another country will offer them to move in tax savings, utilities, etc.

If and that is not a little “if”, they decide to move, Costa Rica won’t be able to stop them. Those companies won’t tell Costa Rica that they are thinking about moving, They will build their new buildings in whatever country has struck a deal with them, and when it is set up and running they will shut down their operations in Costa Rica and will be gone in a few days. Those businesses have figured out just how long they needed to operate in the buildings they put here to reduce the cost to zero and they figure that into their profits.

When the proposed taxes/utilities costs equal the cost of a new building and the move they will be gone, and others will follow. The tax free zone will be tax free again as there will be no businesses there to tax. This is not an opinion, it is a fact. It has happened elsewhere and will happen here.

Ask the folks what happened in the United States about what happened to their jobs there when the cost went too high. That is how Costa Rica got them to come here in the first place. Need I say more????

Wake up Costa Rica or lose big time, and I don’t think you can afford it.
Art Sulenski
San Ramón
Find out what the papers
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By the A.M. Costa Rica staff

Here is the section where you can scan short summaries from the Spanish-language press. If you want to know more, just click on a link and you will see and longer summary and have the opportunity to read the entire news story on the page of the Spanish-language newspaper but translated into English.

Translations may be a bit rough, but software is improving every day.

When you see the Summary in English of news stories not covered today by A.M. Costa Rica, you will have a chance to comment.

This is a new service of A.M. Costa Rica called Costa Rica Report. Editor is Daniel Woodall, and you can contact him HERE!
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San José, Costa Rica, Monday, Oct. 17, 2011, Vol. 11, No. 205

The rain put a damper on all sorts of activities. This was a celebration of the 50th anniversary of the Instituto de Desarrollo Agrario downtown Friday. But the weekend soccer games went on as scheduled.

small turnout
A.M. Costa Rica/Shahrazad Encinias

Little relief from rains and slides expected until Wednesday
By the A.M. Costa Rica staff

The national weather institute said Sunday night that the current rainy conditions are expected to last until Wednesday.

That is not good news for more than 300 persons in public shelters or those whose homes are in jeopardy below water-soaked mountain sides.

Sunday's rain was accompanied by chilly weather in much of the country. In Santa Rosa, for example, in the north Pacific, the temperature hovered between 21 C. (about 70 degrees F) and 22.8 C (about 73 degrees F).

But the worst part was the rain. The national emergency commission said that Guanacaste continues to be hit hard and that heavy rains also fell in the northern part of the Central Valley, including Grecia.

Sunday from 7 a.m. to 7 p.m. Guanacaste got between 63 millimeters of rain (some 2.5 inches) up to 136.1 millimeters (5.3 inches) in Santa Rosa. The northern zone got 100 millimeters (3.9 inches) in 24 hours and 70 millimeters (2.76 inches) fell in just three hours on parts of the Caribbean coast late Sunday afternoon.

Rivers continue to rise, said the Instituto Meteorológico Nacional. There was concern about more flooding.

The Ministerio de Obras Pública y Transportes said that most of the roads that had been closed by slides and other problems were open. The Caldera highway has been reduced in one place to a single lane because crews are still cleaning up a slide that closed the toll road over the weekend.

The Consejo Nacional de Vialidad instituted telephone lines for the public where motorists could learn the condition of the highways. A Web page that usually carries that information is inactive. The numbers are 2202-5567
and 2202-5577. They are in service from 7 a.m. to 10 p.m.

By Sunday night the Consejo said that only nine of an earlier 142 problem highways were still closed. Most highways were affected by slides, but several bridges were damaged or destroyed, too.

The rainy week began as the result of a tropical depression in the Pacific. Then in the Caribbean another low pressure area developed. That system now is centered between the Yucatan peninsula of México and Florida, but the effects are being felt here.

The Comisión Nacional de Prevención de Riesgos y Atención de Emergencias said that Guanacaste and the northern zone were getting the brunt with towns cut off and many areas flooded.

Santa Cruz, Liberia, Carrillo in Guanacaste and Grecia, San Ramón, Alajuela and Mora were listed as being affected by flooding, slides and communities being isolated. There also is flooding lingering in Golfito. Shelters are there, in Puntarenas Centro, Poás, Santa Ana, San Ramón, Carrillo and Santa Cruz.

The emergency commission has continued an alert for the Pacific coast and the Central Valley.

Commission geologists inspected several landslide areas. They are Chitaría and Tapezco in Santa Ana, La Cascabela in Alajuelita, Burío in Aserrí and El Tablazo in Desamparados. As a result, the commission decided to evacuate six families in Desamparados. They were in a high-risk area. Another evacuation was being attempted in Salitral in Santa Ana.

The commission sought to relocate 80 persons in Matinilla de Salitral de Santa Ana, but some would not leave their homes. Only 21 persons showed up at a shelter set up for that purpose in Piedades de Santa Ana.

Massive police turnout nets underage drinkers, pot suspects
By the A.M. Costa Rica staff

The idea appears to be sound. Keep the drunks off the road by putting them on buses and bringing them around to local bars.

That is the concept that put three buses on the road Saturday
Mica tour
Poster for bar tour
night on the way to three different watering holes. For 6,000 colons, about $12, participants gained entry into the bars where there normally is  cover charge. They also got beer and at least one shot of Jagermeister on the bus.

The first stop was at Bar La Nena in Montes de Oca. The problem did not begin until the buses unloaded early Sunday at Viva La Vida Bar & Kitchen in a Pavas industrial zone not far from the U.S. Embassy.  About
100 police officers, social workers and others in official capacity also showed up.

Involved were the Patronato Nacional de la Infancia, the Instituto sobre Alcoholismo y Farmacodependencia, the Ministerio de Salud, the Policía de Control Fiscal, the Policía Municipal de San José, the Fuerza Pública, the Judicial Investigating Organization, the Policía de Tránsito, the security ministry's dog unit and a prosecutor assigned to juvenile cases.

The police raid netted five girls who had entered the bar using fake or borrowed cédulas and three young men accused of selling marijuana. Police said they found 10 doses of marijuana. The marijuana was believed to have been found in a vehicle that was not one of the buses.

It still is unclear if the five girls were passengers on the bus or arrived at the bar by their own means. Some were said to be drunk.

The big law enforcement turnout appears to have been
detained male
Ministerio de Gobernación, Policía
y Seguridad Pública
One of three men detained early Sunday is led away

sparked by a tip that the event, organized under the name Mica Tours, was designed to transport underaged drinkers to the bars. However, on a Facebook page organizers clearly state that the event is only for adults. Individual organizers are identified as Daniel Chacón and Ariel LaFuente.

Many of the participants are believed to be Universidad de Costa Rica students because advance ticket sales were made there.

The country's drug czar, Mauricio Boraschi, issued a statement urging parents to keep better track of their children.

Casa Presidencial said that the Ministerio de Salud ordered the bar to be closed because those in charge could not immediately find documents showing that they had all the permits.

The police action appears to have ended the bar tour. Police said the bus drivers were ticketed for traffic infractions. The last stop was to be Club Gaira in Escazú.

The tour also included a 4 a.m. breakfast.

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San José, Costa Rica, Monday, Oct. 17, 2011, Vol. 11, No. 205

In Costa Rica, the occasional occupiers are called indignados
By the A.M. Costa Rica staff
Events elsewhere . . . HERE!
In Costa Rica the movement is called the indignados, probably best translated as the outraged ones.

They gathered Saturday in the Plaza de la Cultura, each with their own personal gripes.

There was dancing in a circle holding hands. There were the obligatory calls to action via a bull horn. And there were the quickly made signs, as well as some dusted off from the opposition to the free trade treaty with the United States.

One man carried a sign saying he was against the elite, the U.S. dollar, masonic orders and Nazis, the latter probably not being of the World War II variety.

Elsewhere in the world the occupiers are spending their days and nights in public areas. In Italy they caused an estimated $1.4 million in damages Saturday. But in Costa Rica,
organizers are considering to gather just once a week at the plaza.

The media came in for some criticism. The daily Spanish newspaper was rechristened La Nazion by one protester. He also was against CIAcismo, a reference to the U.S. spy agency, also homophobia, sacred cows, individualism, capitalists and sadness. One sign bearer opposed vaccination.

Capitalism was not dead. One woman held a sign offering to sell a finca with good climate.

Former leftist lawmaker José Merino del Río spoke, and someone posted his words to the Web. He estimated the crowd at from 400 to 500. Others said about 200. Most were young with a sprinkling of older activists.

He noted the movement is anti-capitalist and said that the goal was to construct a Costa Rica, humane, for the common good, and a society where everyone fits, including nature.

Peter and Wendy will fly again at Teatro Nacional this weekend
By the A.M. Costa Rica staff

The  Ballet Juvenil Costarricense is presenting “Peter Pan,” a ballet in two acts Saturday and Sunday. The ballet is based on the children's story, and the lead role of Peter will be filled by Solieh Samudio, lead dancer of the Ballet Nacional de Panamá.

The Spirit Dance Academy of Panamá also is invited. The  Pointé Centro de Danzas and the Ballet Academy from Costa Rica also is providing dancers.

The Ballet Juvenil is the group that has presented “The Nutcracker” at Christmas for three years.

The choreography was by Annia Rosales, director of the  Ballet Juvenil. Expats might be interested in known that Captain Hook is called Capitán Garfio.

Despite being in just two acts, the ballet includes the battle scene between Peter, Wendy, the lost boys and their opponents Capt. Hook and his pirate crew, said the Teatro Nacional, where the ballet is being staged. And there is the crocodile.
Teatro Nacional graphic
Hook and Peter again cross swords

The Saturday show is at 8 p.m., and the Sunday curtain rises at 11 a.m. Tickets range from 10,000 colons or about $20 to 5,000 colons or about $10. Plus there are discounts for children under 12.

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San José, Costa Rica, Monday, Oct. 17, 2011, Vol. 11, No. 205

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Police raid in Colombia
nets six tons of cocaine

By the A.M. Costa Rica wire services

Colombia police say a large illegal drug processing laboratory has been destroyed during a raid that netted six tons of cocaine valued at $180 million. 

Police say they also seized tons of other material in the raid in a rural section of Meta province in the eastern part of Colombia.  There are no reports of arrests.

Authorities say they believe the operation was run by a drug gang known as the Popular Revolutionary Anti-Terrorist Army of Colombia.  Police say the laboratory and nearby houses could shelter at least 40 men.

The United Nations says Colombia is among the world's largest cocaine producers, and the United States is one of its most lucrative markets.

U.S. political parties seeking
incorporation protest gripes

By the A.M. Costa Rica wire services

The occupy protests around the United States have provided another opportunity for the Democratic and Republican parties to voice their differences.  To the dismay of the protesters, both parties show signs of trying to sway public sentiment about the demonstrations in their favor.

Four weeks after the occupy protests began, both the Republican and Democratic parties are trying to use them for political advantage.

At first, Republicans were dismissive.

But then the Republican presidential candidates, such as Herman Cain, began blaming the protests on President Barack Obama.

"This is a distraction from the failed policies of the Obama administration," said Cain.

Political analysts say that strategy aims to energize voters and refocus anger into traditional Republican themes such as bloated government.

"The one effective line that I think they will continue to use is that those protesters should turn their sights not so much on Wall Street, but right down to the White House," noted John Fortier with the Bipartisan Policy Center.

Protesters like Ron Sanger say they expect the news media and politicians to distort their message.

"They keep denying or not addressing the real issues," said Sanger.  "And these little sound bite thing.  It's not going to sell.  People are getting smarter than that.  And that is why we are here."

Democrats were quick to sympathize with the demonstrators.  Political analysts say party leaders see some themes they hope will lure voters, like higher taxes for the rich.  Ruy Teixeira is with The Center for American Progress.

"So, I think they want to try and take advantage of it and it will fit nicely into a lot of the themes that President Obama is trying to develop for his campaign," said Teixeira.

But the protesters object.  They are angry with President Obama on a number of issues, such as the wars in Afghanistan and Iraq, and his treatment of Wall Street bankers.  Vera Spohr voted for Obama, but is unhappy.

"He has always been owned by the money.  He still is.  Sure, he will take whatever he can from us and use it his way.  But he is not going to make any substantive changes," said Ms. Spohr.

The protesters say they seek no political endorsements and will ignore the political spin.  They plan to press on with their message: that they are the 99 percent of the population calling for economic justice.

Meanwhile, the movement that began in New York City a month ago has gone global with demonstrations taking place in countries in Asia and across Europe.

The vast majority of the protests, which have attracted thousands, have been peaceful. But there was violence in Rome Saturday.  Hundreds of hooded, masked protesters hurled rocks and bottles, setting fires and smashing bank and shop windows.  More than 70 people were injured.

As the Occupy Wall Street protest movement continues to spread, quite a few members of the Asian–American community are taking part.

Italian Prime Minister Silvio Berlusconi said Sunday the violence was a worrying sign for civil society.   It was one of the worst outbreaks of violence in the Italian capital in decades

Rome's mayor, Gianni Alemanno, says repairing the damage could reach $1.4 million.

In London, several hundred protesters have established a camp site just outside St. Paul's Cathedral which is adjacent to the British capital's financial district.

In the mid-western U.S. city of Chicago, Illinois, some 175 people have been arrested when they refused to remove their tents and leave a park.

The demonstrators are seeking to focus attention on what they see as corporate greed and economic inequality, the increasing gap between the rich and poor across the globe. 
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San José, Costa Rica, Monday, Oct. 17, 2011, Vol. 11, No. 205

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Latin America news
Agrarian development unit
marks its 50th anniversary

By the A.M. Costa Rica staff

The Instituto de Desarrollo Agrario de Costa Rica celebrated its 50th anniversary at the Plaza de la Cultura, but the event was cut short because of intense rains.

As part of the observance, President Laura Chinchilla called upon lawmakers to pass pending legislation to transform the institute and change its name to the Instituto de Desarrollo Rural. She said this new model would respond to current problems and the needs facing Costa Ricans in the rural areas.

The agrarian government organization was established Oct. 14, 1961, via a law known as Ley de Tierras y Colonizacion.

In the plaza organizers had a stage set-up and various tents representing the institute and other environmental friendly and free-trade organizations. The Instituto de Desarollo Agrario tents were filled with tropical plants, fruits and vegetables that are common of the country such as birds of paradise, ginger flowers, bananas, lychees, and kabocha squashes the size of a basketball, also known as calabaza.

They were handing out free fruits and vegetables to attendees of the event. At the end many people also walked away with beautiful flowers ranging in various shades of pinks, oranges, reds and greens.

Bandits shoot two in legs
in separate Saturday crimes

By the A.M. Costa Rica staff

A man in Calle Blancos suffered a bullet wound to the leg when he came to the aid of his wife who was being robbed in the family's parking area. The location is north of San José Centro.

The Judicial Investigating Organization said that this happened about 8:30 p.m. Saturday after the woman returned home and opened the gates to the parking area. Two men on a motorcycle intruded and hit her on the head. The husband witnessed the events from inside the house and came out. That is when he was shot in the right leg.

A 25-year-old man waiting for a bus a half hour later in Curridabat also suffered a bullet wound to the leg when bandits pulled up in a vehicle and pulled a gun on him and another would-be bus passenger. The man threw his cell phone at the bandits, agents said.

Immigration agent says
he was offered a bribe

By the A.M. Costa Rica staff

Immigration police said they found a Chinese woman working illegally at a bar in the center of Limón. But a man there compounded the problems when he offered police a bribe to let the woman go, said the Ministerio de Gobernación, Policía y Seguridad Pública.

The man, also of Chinese heritage, was a legal permanent resident. But the woman lacked documents, said police.

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