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Employment law overview Argentina
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Argentina

Employment law overview Argentina

Introduction

Argentina’s labour laws are remarkably comprehensive and regulate virtually all the terms and conditions of the employment relationship. Labour laws are public policy and are therefore mandatory. The employer is obligated to grant employees at least what is afforded to them under labour legislation. Hence, an employer can extend benefits on top of the standard provisions, but cannot agree to terms that are less favourable or otherwise detrimental to an employee, nor can an employee waive any known right or privilege established for his/her protection or benefit under the law.

Key Points

  • Argentina’s labour laws are pro-employee and have been designed to safeguard the rights of employees and workers, by instituting rules governing working conditions and working hours, providing for payment of salaries during illnesses, setting surcharges on salaries for overtime, establishing annual vacations and requiring the payment of severance compensation in the event of unfair dismissal (dismissal without justified cause).
  • Labour law in Argentina is comprised of public order provisions and thus cannot be ruled out, or waived by any agreement, applicable law or jurisdictional clauses subsequently included in any agreements. Accordingly, Argentina’s labour laws will apply – and the labour courts will have jurisdiction – with respect to any eventual labour claim filed with the courts related to work performed in Argentina.
  • Employees are entitled to a 13th salary or statutory annual bonus, called “aguinaldo” or “sueldo annual complementario/SAC”, which is payable in two semi-annual installments, to be paid on 30 June and 18 December. Each installment is equal to 50% of the highest monthly salary accrued during the corresponding semester.
  • Employers must pay a compulsory life insurance for all employees.
  • The employer can only change the terms and conditions of employment, provided that those changes are not unreasonable and do not either:
    • modify the essential terms of the employment contract; or
    • cause moral or material damage to the employee.
  • As labour laws are federal laws, the terms and conditions are standardised nationally.
  • Labour Contract Law 20,744 (the “LCL”), together with any other complimentary legislation and applicable collective bargaining agreements, tailor the general provisions that govern the conditions of employment.
  • Law No. 23,660, the Health Insurance Act, sets forth the measures necessary to establish appropriate health and medical care services to employees and their families.
  • Argentina’s Employees’ Pension and Retirement Act (Law No. 24,241) secures access to public funds for employees and independent workers who are eligible to apply for retirement or a pension plan, a disability retirement annuity as well as pension coverage in case of death.
  • Law No. 19,587 on Occupational Hygiene and Safety lays down the standards and procedures applicable to all workplace establishments, regardless of the nature of their economic activity.
  • The Working Hours Act (Law No. 11.544/1929) regulates working hours.
  • Law No. 24,013 regulates temporary personnel service companies and related fines for improper registration of labour relationships.

New Developments

A prohibition on dismissals is currently in force, pursuant to Decree 624/2020, by which an employer cannot proceed with a dismissal without just cause, for lack of work or a decrease in work, or due to force majeure until 30 September 2020. In case the employer proceeds with a termination of an employee in violation of the above, such termination will be considered null and will have no legal effect. As such, the employment relationship will continue under the same terms and conditions. Decree 624/2020 also prohibits furloughs due to force majeure, for lack of work or a decrease in work until 30 September 2020.

Additionally, severance compensation duplication pursuant to Decree 528/2020 due to an occupational emergency is currently in force until 7 December 2020.

Both the prohibition on dismissals and the severance compensation duplication may be extended in time, according to the emergency context.

On 30 July 2020, the National Senate approved the Legal Regime of Teleworking Contract (“Teleworking Law”). This law guarantees minimum legal requirements for a teleworking contract and provides that specific regulations for each activity will be established through collective bargaining, complying with the principles of labour’s public order.

Pursuant to the Teleworking Law, the working day must be agreed in advance and in writing, complying with legal and conventional limits in force. The law provides that the platforms and/or software used must not authorise the worker’s connection outside of working hours. The teleworker will have the right to not be contacted and to disconnect from digital devices and/or ICTs during off-hours and leave periods.

The transfer from the on-site modality to the teleworking modality must be done with the employee’s voluntary acceptance in writing, except in duly accredited cases of force majeure.

In the case where the worker performed tasks under an on-site modality and voluntarily agreed to provide tasks under the teleworking modality, he/she may revoke the consent given at any time during the employment relationship and without prior notice, and the employer is obliged to reinstate the worker in the establishment in which he/she had previously performed their work or at the closest establishment to the worker’s home in which he/she could perform tasks, unless it would be impossible to comply with this obligation, for reasons which are legitimate and justified.

Regarding a worker who, from the beginning of the relationship, agreed to provide tasks under the teleworking modality, the eventual change to an on-site modality, will operate according to the guidelines established by collective bargaining for each activity.

The employer must provide the employee with the necessary equipment, including hardware and software, work tools and the support necessary to perform the tasks, as well as assume the costs of installation, maintenance and repair of such devices. The Teleworking Law contemplates the possibility that the teleworker will satisfy the essential working elements, and that the employer will compensate for the use of such tools which are owned by the worker, in which case, such compensation will operate according to the guidelines to be established by collective bargaining.

The control systems implemented to protect the employer’s assets and information shall have union participation, in order to safeguard the teleworker’s privacy and the privacy of his/her home.

In cases of transnational telework, the law governing the place of performance of the tasks, or the law of the employer’s domicile, whichever is more favourable to the teleworker, shall apply.

The Teleworking Law will enter into force ninety days after the end of the mandatory social distancing and self-isolation measures currently in force.

Any questions

Ask our member firm Allende & Brea in Argentina