Argentina: Prohibition of Dismissals and Furloughs Due to COVID-19 Extended

The prohibitions on dismissals and unilateral furloughs took effect last April (2020) as a measure to control unemployment caused by the COVID-19 pandemic.

Now, Decree 266/2021 (the “Decree”) has extended the prohibition on dismissals: (i) without justified cause; or (ii) due to lack or reduction of work and force majeure until 31 May 2021.

The Decree also extended until 31 May 2021, the prohibition of unilateral furloughs on grounds of force majeure, or lack or reduction of work.

Exceptions to this prohibition include the furloughs provided for in the terms of Section 223 bis of the Labour Contract Law; that is, furloughs agreed upon with each employee or the union, approved by the labour authority, for those employees who shall not perform any tasks due to lack or reduction of work (not attributable to employer) or force majeure (dully evidenced).

The Decree provides that any dismissals and lay-offs in breach of the provisions of this Decree shall have no effect, and the labour relationships and its terms and conditions shall remain in force as before.

The Decree shall not be applicable to those hired under the construction industry legal regime of Law 22,250 or to those hired after 13 December 2019.