Accrued salaries initiative is criticized

Senator Napoleón Gómez Urrutia presented an initiative to reverse the limit that was set on the payment of accrued salaries, seeking to have these accrued salaries paid indefinitely by the employer in case of going to trial.

In the opinion of the experts, this situation discourages conciliation between workers and employers, encouraging the lengthening of trials.

The initiative proposes an amendment to Article 48, which covers the topic of accrued salaries, as the Labor Reform of 2012 significantly reduced the amount to be paid for accrued salaries due to unjustified dismissal (to one year), therefore harming the human right of the worker to recover from the damage caused by the employer.

“If the employer cannot provide proof of the cause for termination in the corresponding trial, the worker will, whichever the action filed, additionally have the right to be paid the accrued salaries computed since the date of dismissal until the ruling is complied with”, warns the document.

Ricardo Martínez, labor lawyer, criticized this initiative, as labor lawsuits could be prolonged.

“Employers don’t have to pay for the inefficiency of conciliation boards, if suits last 5 or 6 years. If a small business owner goes to trial and said trial lasts for 5 years and accrued salaries are collected, the business will surely have to close. And this is also the case of the medium-sized entrepreneur; instead of creating initiatives that generate employment, which is what the Country needs in face of the great need for investment, what initiatives of this type do is to discourage investment”, stated Ricardo Martínez, labor lawyer.

The expert said that, with the limit of one year for the payment of accrued salaries, the number of trials decreased as did the business of lawyers that prolonged said trials without justification.

“This goes against employment. The Supreme Court of Justice has declared that the reform to a one-year limit is constitutional and we would be going backward.

“The lawyer will say “I will not reach an agreement, let the trial go on for years”. The positive effect was a limit on accrued salaries and a pre-conciliation; this was going to reduce the current lag in trials: there are over 550 thousand delayed trials in the Federal Board and 400 thousand additional ones in the local board. The positive effect of the pre-conciliation will be lost. This is a retrograde initiative”, he underlined.

The unit commissions of Labor and Social Welfare and of Legislative Studies gave a positive opinion in regard to the initiative for the reform of Article 48 of the Federal Labor Law.

The proposal made by senator Napoleón Gómez Urrutia helps promote an equality of circumstances in the event of unjustified terminations, was stated in the opinion.

Another front

The initiative for the reform of Article 48 of the Federal labor Law is creating controversy.
– A limit of one year for the payment of accrued salaries to workers by employers was set in the Labor Reform of 2012
– The initiative of Senator Napoleón Gómez Urrutia seeks to eliminate that limit and that the corresponding accrued salaries are paid throughout the duration of the trial.
– Detractors of the initiative warn that this discourages conciliation and will have a negative impact on smaller companies.

Note published in El Pulso Laboral, in the Mercado Laboral section by the Editorial Department