Can a job agency charge you in Puerto Rico? Act 417

What they can charge you, and what they cannot

The short answer is in Section 4 of Act 417 of 1947, and it is more protective than people assume. A licensed agency **may not require payment of fees for registering job applications, nor any other fees**, with a single exception: **fees for supplying employees or for jobs obtained directly as a result of the agency's efforts**.

Read it again, because everything is there: **the charge is tied to a result**, and to a result the agency produced. Paying to “sign up,” to “activate your profile” or to “stay in the database” does not fit that exception.

Likewise, the agency **may not require you to subscribe to a publication or incidental service, nor to contribute to the cost of an advertisement**. That is item (1) on the same list.

Nor is the amount free. Section 5 requires **every agency to file with the Secretary of Labor the list of fees it intends to charge** for all services it renders to employers and workers, and declares that **it shall be unlawful to charge or accept, directly or indirectly, any fees other than those on that filed list**. If they charge you something not on the list, its illegality does not depend on whether it strikes you as expensive: it depends on its not being filed.

“Fees,” moreover, is defined broadly in Section 1: **money or anything of value**, imposed, charged, collected or received **directly or indirectly**, or paid or promised to be paid. There is no dodging it by calling it a “donation,” a “processing charge” or a “deposit.”

And if the fees are abusive? Section 5 gives the Secretary authority to investigate **on a complaint or on their own initiative** the reasonableness of fees, hold a **public hearing** after summoning the parties and, as a result, **approve, reduce, increase or prohibit the charging** of all or some fees. They weigh the class of agency, economic and competitive conditions, the type of job, its duration and the wages to be paid. And in any hearing on an **increase**, the burden of proving it is fair and reasonable **rests on the agency**.

The license: operating without one is a crime

Act 417 requires every private employment agency to hold **a license issued by the Secretary of Labor**, and it is blunt about those who lack one: **anyone operating an employment agency without first obtaining the license commits a misdemeanor, and each violation constitutes a separate offense**.

The license is not generic. It **states the name of the person it is issued to and the specific place or address where the agency will operate**, and **is valid only for that person and that place**. Changing location requires the Secretary's **written approval**, noted on the license. It **lasts one year** from approval, unless revoked or suspended sooner.

Before issuing it, the Secretary **conducts an investigation into the applicant's character, morals and commercial integrity**, and issues it only if satisfied they are of good moral conduct, commercially responsible and compliant with the other requirements, upon payment of a **twenty-five dollar ($25) fee** in internal revenue stamps.

The Department currently publishes the concrete list of documents to obtain it: **application on the Labor Standards Bureau form**, **a $3,000 damage bond with evidence of payment**, **a Negative Criminal Record Certificate**, **a $25 internal revenue stamp**, **a Certificate of Incorporation from the Department of State and a Good Standing Certificate**, and **filing the fee list**.

That bond is what protects you. Section 3 provides it be posted in favor of the People of Puerto Rico and deposited with the Secretary, in the amount the Secretary sets according to the size of the business, and that it carry the condition that the agency will comply with the law **and pay any loss or damage caused to any person** by breaching it. Two details worth their weight: **revoking the license does not affect the bond's effectiveness as to claims arising from acts before** the revocation, and if the Secretary demands a new or supplemental bond and the agency fails to comply **within ten days**, that **operates as automatic revocation** of the license.

A territorial limit almost nobody knows: the license allows operating **only within the limits of Puerto Rico**. To **recruit or bring workers from outside Puerto Rico, or refer workers for employment outside Puerto Rico**, a **special permit from the Secretary** is needed, issued only when in their judgment special circumstances warrant it.

The list of what they are forbidden to do to you

Section 4 enumerates eighteen prohibited acts. These are the ones that matter most to a job seeker:

• **Making you any false promise**, or giving you incorrect or false information.
• **Sending you to a place where a strike or lockout exists without telling you in writing beforehand.** A copy of that notice **must be signed by you** and kept by the agency for one year.
• **Having you sign documents about your liability** on forms not previously approved by the Secretary, and **any document executed in violation of the law is null and void**.
• **Using any contract form other than the one prescribed or approved** by the Secretary.
• **Sending you somewhere with no requisition** for that job, and without giving you the necessary information about the job.
• **Obtaining or attempting to obtain a person's dismissal** from their job, and **inducing an employee to leave their job** to place them through the agency.
• **Placing you in a job or occupation prohibited by law**, or **sending you to a place harmful to health or morals**.
• **Making inquiries or setting limitations** based on religion, race, color, birth, origin, social condition, political affiliation or sex, and **publishing advertisements** expressing those limitations.
• **Excluding persons whose ages fall between 30 and 65**, except where by the nature of the work age is a determining factor of the ability to perform it.
• **Holding a financial interest in restaurants, labor camps or places where alcoholic beverages are sold**, and operating the agency in living quarters or in a building where such beverages are sold, without the Secretary's written consent.
• **Using signs or advertising emblems of the Government's public employment service**, which is the classic way of passing oneself off as the official office.

What the agency must have posted on the wall

Subsection (b) of Section 4 turns three duties into something you can verify with your own eyes on the first visit. Every employment agency must **post in a visible place in its establishment: the license, a summary of the law and its regulations (supplied by the Secretary), and a fee table**.

If you walk in and do not see those three things, you already have a question to ask before handing over a document or paying anything.

The other two duties in the same subsection: **keeping records of all its activities for at least one year** in the form the Secretary prescribes, and **filing with the Secretary the list of all fees** it will charge. That list **may be changed within fifteen (15) days** after a new one is filed; and under Section 5, an amended list approved by the Secretary **takes effect sixty (60) days** after filing.

They must also **conduct the business in a hygienic place in good sanitary condition**. It sounds like another era, and it is (the law is from 1947) but it is still text in force.

If they overcharged or misled you: where to go

The law is administered by the Labor Department's **Labor Standards Bureau**, the same one that issues the licenses. The Department publishes its contact for this topic: **(787) 754-5353, extensions 12418 and 12419**, email **normas@trabajo.pr.gov**, and offices at the **Prudencio Rivera Martínez Building, 9th floor, 505 Muñoz Rivera Ave., San Juan**.

The powers behind a complaint are not symbolic. Section 7 authorizes the Secretary to make all necessary investigations, **hold public hearings, subpoena witnesses under threat of contempt, administer oaths**, and to **visit and examine the agency's premises and examine and copy its books, records and documents**. Anyone refusing to appear without justified cause can end up in contempt proceedings and, upon conviction, in a **misdemeanor with a fine of no less than $50 or thirty days in jail**.

And there is a fast track: jurisdiction is conferred on the **San Juan part of the Court of First Instance** to, at the Secretary's instance, **issue injunctions** and grant any other remedy needed to make the law effective.

Section 11's penalties: **a fine of no less than $300 and no more than $1,000, or 30 to 90 days in jail, or both**, at the court's discretion. For the two discrimination items ((17) and (18)) the fine is **$100 to $500**, or 30 to 90 days in jail, or both. **On a repeat offense**, the fine rises to **between $500 and $2,000** and jail to **between 60 and 180 days**. The **Court of First Instance has exclusive jurisdiction** over these cases, and they are tried **before the court**.

If the money you lost came from an agency breach, remember the bond: its express condition is **to pay any loss or damage caused to any person** by violating this law, and it keeps answering for earlier acts even if the license is later revoked.

The agency has a remedy too: anyone aggrieved by a Secretary's order **suspending or revoking a license** has **thirty (30) days** from notice to bring an action in the **San Juan part of the Court of First Instance**; the Secretary files the entire record within **ten (10) days**; review **is limited to questions of law**, and **the Secretary's findings of fact are conclusive if supported by the evidence**, with appeal to the Supreme Court.

Before signing anything: five checks

With the above in hand, a visit to an agency becomes a short checklist. **One:** look for the **posted license** and check that the name and address match where you are standing, the license is valid only for that person and that place. **Two:** look for the **fee table** and the **summary of the law**, which must be visible.

**Three:** ask **exactly what they will charge you and on what account**, and compare it with that table. If there is a charge for registering, for an advertisement or for “keeping your application active,” you are facing a charge Section 4 prohibits. **Four:** do not sign documents about your liability or contracts on forms other than those approved by the Secretary; anything executed in violation of the law **is void**.

**Five:** if they send you to a company, ask whether there is a strike or lockout. Written notice **before** sending you is mandatory, and so is your signature on it.

Two currency warnings, to read this guide with a cool head. Act 417 **is from 1947 and its last incorporated amendment is from 1975**; the official compilation used here is the **February 16, 2021 revision**. And the item on ages **protects people from 30 to 65** in the language of that era: for age discrimination today there are also other laws, local and federal, which this guide does **not** interpret, see our guides on employment discrimination and on illegal interview questions.