Resolution No. 938/2020 of the Ministry of Labor, Employment and Social Security: REPRO II Program.
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Labor & Social Security Law Department Report | Resolution No. 938/2020 of the Ministry of Labor, Employment and Social Security: REPRO II Program
Dear Sir or Madam,
Resolution No. 938/2020 of the Ministry of Labor, Employment and Social Security (the “Resolution”), published in the Official Gazette on November 13th, 2020, creates the Productive Recovery Program REPRO II (the “Program”), which will become effective on November 21st, 2020.
The Program consists of a subsidy for those employers who enroll and comply with the requirements established by the regulation. The benefit will be extended for two months.
Requirements to access the Program
To access the benefits of the Program, employers must submit the information required by the ATP program (payroll of dependent employees, including total remuneration and the Unique Banking Key of the employee), and must incorporate the following documentation:
(i) Financial Statement of Fiscal Year 2019 certified by the Professional Council of Economic Sciences. The certification may be holographic or digital. This financial statement will not be required for civil associations and all other employers that are not subject to the submission of financial statements.
(ii) Electronic form in which companies must complete a set of the economic, estate, and financial indicators.
(iii) Certification of the veracity of the information included in the form established in point (ii) by the accountant.
Pre-selection and selection criteria to access the benefit
(i) Pre-selection criteria: the main activity of the employer must be included in the list of non-critical activities included in the ATP Program and register a year-on-year variation in the negative billing of the reference month.
(ii) Selection criteria: evaluation of a set of economic, financial, and labor indicators, calculated for the last 3 months as of the date of registration and for the same months of the previous year.
The indicators are as follows:
1. Year-on-year percentage variation in billing.
2. Year-on-year percentage variation of VAT purchases.
3. 2020 Indebtedness (total liabilities/equity).
4. 2020 Current liquidity (current assets/current liabilities).
5. Year-on-year percentage variation in electric power and gas consumption.
6. Year-on-year percentage variation of the relation between total labor cost and invoicing.
7. Year-on-year percentage variation of imports.
Exclusions from the Program
The law establishes that those employers who carry out the following actions will be excluded:
(i) Dismissal of employees due to dismissal without due cause, lack or decrease of work, or force majeure.
(ii) Suspensions due to lack or decrease of work or force majeure, except for those suspensions that are regularized in the terms of Section 223 bis of the Employment Contract Law.
(iii) The employers who provide false information to access the benefit will suffer the immediate expiration of the benefit, the impossibility to re-register, and the possible legal actions that may be taken by the Ministry of Labor, Employment and Social Security and/or the Federal Administration of Public Revenues.
Incompatibility of the Program with other benefits
(i) Complementary Salary of the ATP.
(ii) Subsidized Rate Credit from the ATP.
(iii) Productive Recovery Program (REPRO).
(iv) Labor Integration Program (PIL).
Should you require any further information on this matter, please do not hesitate to contact us.
Sincerely,
Alvaro J. Galli
Santiago H. Taboada