Employers lack clarity in regard to the implications of Phase 2 of the Coronavirus pandemic

The interpretation of the decree published by the Federal Government on the actions corresponding to Phase 2 of the Corinavirus pandemic has divided opinions in the labor sector, given that there is no clarity as to how the suspension of activities should be conducted nor in regard to labor relationships.

Given the above, a meeting between the labor authorities and the Department of Health is expected to be held this Wednesday, with the objective of defining the scope of the decree issued last Tuesday afternoon and informing the implications for labor relationships.

Oscar de la Vega, labor law specialist, said that “unfortunately, the wording of the decree is unclear and raises important questions on the definition of the actions to be followed”.

Although the penultimate paragraph of subsection c) of Article Two of the Decree states that employment relationships must be maintained, a first interpretation leads us to believe that this refers to the fact that employment relationships must not be terminated; nevertheless, in the event of the temporary suspension of the employment relationship referred to in the Federal Labor Law, we believe that there are sufficient grounds to apply the provisions of Articles 42 Bis and 427 Section Seven, as applicable,
That is “it is valid to temporarily suspend employment relationships and paying one day of the minimum wage for up to one month as compensation. Nevertheless, companies may reach agreements with workers and/or unions to obtain payment modalities above the one defined by law”.

Germán de la Garza de Vecchi, labor specialist, pointed out that the lack of precision is evident, given that there is no definition of what a suspension of activities implies. “Given the above, and subject to much-needed clarifications to the decree, which should be made not only by the Department of Health but also by the Department of Labor and Social Welfare, we believe that companies must continue with their emergency plans in regard to essential personnel that must be present at the workplace, seeking to avoid physical crowding, having only the minimum necessary personnel and establishing additional mechanisms (medical monitoring and safety equipment) to enable said personnel to provide their services with a minimum of risk and guaranteeing their health at all times”.

Note published in El Economista, Empresas [Companies] Section by María del Pilar Martínez