The Republic of Palau is a constitutional democracy with a bicameral legislature. The President and Vice-President are elected every 4 years, as are the 9 members of the Senate and the 16 members (1 from each state) of the House of Delegates. There are no political parties. The 2004 elections, held on the basis of universal suffrage, were deemed free and fair. Each state also sends its highest ranking traditional chief to the Council of Chiefs, which advises the President on traditional law. A female Senator serves also as Minister of Health. 2 members of minorities serve in the House of Delegates. The judiciary is independent.

Discrimination on the basis of sex, race, place of origin, language, religion or belief, social status or clan affiliation is prohibited.

Palau has no security forces other than local police. A Marine Law Enforcement Division patrols the borders with assistance from the Australian government. Reports do not indicate abuses by the police force. Government corruption is reported as a problem that the government is trying to deal with.

Freedom of speech and of the press are guaranteed. Internet access is not restricted. Access to government documents is provided through legislation and respected in practice.
An anti-trafficking law penalises trafficking.

Education is universal and compulsory for ages 6 to 14 and is free to age 17. 94% of school age children are reported to attend school, and 97% of those who begin primary school are reported to complete it, while 78% of those who enrol in secondary school complete it. Access to education is provided equally to boys and girls. Opportunities for scholarships to attend postsecondary education abroad are open to both boys and girls.

A 3-year programme begins at age 3. At this level 24% of education is private. The Gross Enrolment Rate (GER) is 69%.

Primary school begins at age 6 and lasts 5 years. 48% of students are girls. The GER is 114%.

Secondary education begins at age 11 and lasts 7 years. The GER is 98%.

95 students from Palau study abroad, in New Zealand (50) and the USA (45).

Discrimination against persons with disabilities is illegal in education and in other state services, and the law is in enforced. Schools have special education programmes to provide education to children with disabilities.

The law does not provide for the granting of refugee status or asylum in accordance with the 1951 UN Convention Relating to the Status of Refugees or its 1967 Protocol, and the government has not established a system for providing protection to refugees. The government cooperated with the UNHCR in the case of the 2 Burmese men who requested asylum.

Only citizens may purchase land. Foreign workers are reported to constitute some 30% of the population and 69% of the work force. Foreign residents experience discrimination and have been victims of violent crime. Despite legal prohibition, discrimination reportedly occurs in employment, pay, housing, education and access to social services for foreign residents.

Reports do not indicate any violations of academic freedom.

Inheritance of property and of traditional rank is matrilineal; women occupy positions of importance within the traditional system. Equal pay for work of equal value is reported to be accepted, and job discrimination is not a problem. Sexual harassment is illegal, and is not reported as problematic.

Domestic violence is common, but the police are not asked to intervene in domestic violence even though it is a criminal offence. Police respond only when reports are filed. Prostitution is illegal but is a problem. Women are trafficked from China, Taiwan, and the Philippines to work as bar hostesses and prostitutes.

No minimum age for employment has been established, but children are generally not in the wage economy. Some assist families in small-scale businesses. No foreigner under age 21 may be employed.

Workers have the right to form and join trade unions. No unions or other employee organisations exist. Legislation does not prohibit collective bargaining, but it is not practiced. Wages are set by the market. Foreign workers who are employed as domestic servants report they were recruited for other employment. There are reports of withholding of passports and threats to do so. The minimum wage is US$2.50 an hour. Foreign workers are not covered by the minimum wage law.