JANUARY 26, 2021

Regulatory alert: Necessity and Urgency Decree No. 39/2021.

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Labor & Social Security Law Department Report | Regulatory alert: Necessity and Urgency Decree No. 39/2021

Dear Sir or Madam,

Necessity and Urgency Decree No. 39/2021 (the “DNU”), published in the Official Gazette on January 23rd, 2021, establishes as follows:

i. To extend until December 31st, 2021, the occupational emergency declared by the Necessity and Urgency Decree No. 34/2019.

ii. To extend the prohibition of dismissals without just cause and for the causes of lack or reduction of work and force majeure for a period of 90 days as of the expiration of the term established by Decree No. 891/2020 (this means until April 23rd, 2021).

iii. To extend for the same term the prohibition of suspending employees for reasons of force majeure or lack or reduction of work. The suspensions concerted under the terms of Section 223 bis of the Employment Contract Law are exempt from this prohibition.

iv. The dismissals and suspensions provided in violation of the provisions of the DNU will not produce any effect, and the existing labor relationships and their current conditions shall remain in full force.

v. That while the occupational emergency is in force, severance compensations shall be doubled under the terms of DNU No. 34/2019.

vi. That said duplication in no case shall exceed five hundred thousand pesos (AR$500,000).

vii. That for a 90-days-period from its entry into force, the COVID-19 disease caused by the SARS-CoV-2 virus will be considered a professional disease -not listed- in the terms of the Occupational Risks Law.

viii. That the Ministry of Labor, Employment and Social Security will be empowered to extend the previous term.

ix. That employees hired after December 13th, 2019, will not be subject to the prohibition of dismissals, suspensions, nor shall they have the right to collect double severance compensations.

Should you require any further information on this matter, please do not hesitate to contact us.

Sincerely,

Alvaro J. Galli
María Eduarda Noceti