Argentina: Employee Dismissed for Cause during COVID-19 Crisis Reinstated
Labour Court orders the reinstatement of an employee dismissed for cause during temporary prohibition of dismissals caused by COVID-19 emergency
On 28 April 2020, in re: “Espinoza, José Alfredo vs. TM S.A. s/ Autosatisfactivas”, the Argentine Labour Court declared null the dismissal of an employee who was dismissed with good cause, and ordered both the reinstatement of the employee to his job and payment of pending wages since the dismissal took place. The Argentine Labour Court ruled that said dismissal violated Decree 329/2020, which temporarily prohibits dismissals.
Decree 329/2020, enacted during the COVID-19 emergency, temporarily prohibits dismissals: (i) without good cause; or (ii) due to lack or reduction of work and force majeure, for a period of 60 days, extended for an additional 60 day period by Decree 487/2020 (e.g. until 30 July 2020). The Decree provides that any dismissals in violation of those provisions shall have no effect, and the labour relationships and their terms and conditions shall remain in force, as before.
In this particular case, the Argentine Labour Court ruled that the dismissal was null because the service of notice of the dismissal with cause did not specifically and clearly describe the alleged breach of the employee and the circumstances during which said breach took place, which the employer is obliged to include in the service of notice, in accordance with Section 243 of Labour Contract Law 20,744. The Court decided that the broad reference to a “poor performance” made by the employer in the service of notice did not comply with said legal requirement.
These circumstances led the Argentine Labour Court to conclude that the dismissal was without good cause and therefore breached the prohibition of dismissals provided by Decree 329/2020. The Court ordered the reinstatement of the employee to his job.
In conclusion, even though the Decree does not prohibit dismissals with good cause, in case the employer does not fully comply with the legal requirements to dismiss employees with good cause, there is a risk that employees could claim reinstatement, in situations where they have been dismissed during the temporary prohibition of dismissal, currently in place until 30 July 2020, due to the COVID-19 emergency situation.
This report cannot be considered as legal or other advice by Allende & Brea or as including all the subjects of the matters described herein. For additional information on any matter related to labor issues in Argentina, please contact Nicolás Grandi (ngrandi@allende.com) at +54 (11) 4318-9984.
For more information please contact Joseph Granato, Communications Manager at L&E Global at joseph.granato@leglobal.org.
