Argentina: Decree 345/2021 Extends Ban on Dismissals and Furloughs

Decree 345/2021 (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 30 June 2021. The Decree also extended until 30 June 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 nor to those hired after 13 December 2019.

Key Action Points for Human Resources and In-house Counsel 

Decree 345/2021 does not prohibit the parties from entering into a mutual termination agreement to bring an end to the employment relationship, subject to the following requirements:

• the employee’s acceptance (he/she agrees to the termination of employment); and
• the termination agreement must be signed before (in the presence of) a notary public.