Several ministries are working hard. Work style reform project whose main purpose is create jobssomething Argentina has not been able to achieve for 15 years.
The aim is to encourage companies to invest without risking falling into the judgment industry trap.The country continues to have a healthy situation that makes it difficult for dozens of small businesses to survive every day.
Hiring employees has become a death trap for many companies that fall prey to the greedy temptations of labor law firms.
Although a law was passed in 2017 to prevent them, labor lawsuit They continue to grow in Argentina.
Efforts are being made on a variety of fronts, including taxation and taxes, to encourage companies to hire people. Labor law.
Labor reform: reducing the burden on employers and encouraging regular work
In addition to dynamic salaries, time banks, company-specific agreements, up to 12 installments of remuneration and labor fines, other initiatives will also be added to promote the employment of talent from the Casa Rosada perspective.
The main axis is to promote regularization of employment. Reducing burden on employers. That’s why the Ministry of Economy is working to make recruiting more attractive to companies.
will be evaluated according to this flow Lower employer fees and replace them with severance paySo while it doesn’t cost the employer more money, it does result in lower costs and more certainty regarding labor litigation.
The proposal aims to provide predictability without increasing spending and reduce labor justice disputes in the process.
Furthermore, we are working under the following structure. income tax deductionAllow all taxpayers to deduct more items.
They believe this will provide even more incentive to demand bills and further formalize the economy, one of the major goals of labor reform.
For Palacio de Hacienda, expanding the range of deductible products and services will increase the transparency of transactions and accelerate bankization.
Main initiatives for work style reform promoted by the government
New employment system, one of the pillars of the labor reform project
Another axis is Creation of a new employment system.
Economics says that it will be very advantageous for the employer. and remember that No jobs have been created in Argentina since 2011.
They argue that reducing the tax burden first requires economic growth, and that more formality is needed in an economy where 30% of activity is in surplus.
Officials have confirmed that raising taxes is not an option, saying the country needs to grow before taxes can be cut.
Along these lines, the objective is to grow the level of formality and economy. A larger base, they reason, would create more resources for tax cuts.
According to Cippec Center research, since 2010; Stagnant creation of private registered jobs and structural changes to less productive activities.
Despite cycles of growth and decline, the number of formal employees has remained roughly the same, and the weight of formal employees in the total number of employees has decreased from almost 60% to less than 50%.
At the same time, manufacturing lost share and retail and other low-productivity services grew.
Also More monopolists (64%) and more informalArgentina will join the countries with the largest declines in labor productivity in the region.
Overall, this trend reveals the country’s failure to grow economically or in terms of employment.
Modern legislatures support economic growth and job growth
The challenge is how to ensure decent work for more Argentines in a context of high informality and low job creation.
The driving force behind employment is economic growth, But modern laws can accompany it to make it more productive and easier to employ, the study notes.
And when the rules are unclear, costs are unclear, and justice is unpredictable, he warns, the outcome will always be the same. As formal employment decreases, people become more cautious..
According to this logic, labor policy has three pillars: Law, collective bargaining, and justice.
Cippec believes that collective bargaining needs to be modernized to incorporate new forms of organization and production.
And the justice system must become more efficient and predictable. There is no point in changing the law if judicial interpretation continues to create uncertainty or if the agreement does not adapt to technological and productive changes, he warns.
And that’s because one of the most sensitive points in the system is expensive lawsuit.
Labor litigation is an important issue that makes it difficult to hire employees.
of Labor lawsuits are on the rise And for many small and medium-sized businesses, these pose risks to business continuity. Legal ambiguity creates costs that hurt employers and workers.
Litigation can be reduced by defining salary concepts and penalties that provide predictability to court decisions. When rules are predictable and duties are clearly defined, working relationships are more stable and trust is increased..
“Labor law must act as a framework, not an obstacle. Labor law must protect workers, but at the same time enable companies to grow and produce. In Argentina, very different sectors coexist, such as industry, agriculture, services and the knowledge economy, and it would be a mistake to demand a single standard for all,” the study said.
For this reason, he believes that the law should establish general principles and allow each sector to: collective bargainingadjust the rules.
A typical case is youth employment, with unemployment and non-regular employment rates for those under 24 years of age being much higher than average, demonstrating the structural difficulties in finding regular work.
According to Mr. Chipek, The central challenge is to strengthen vocational training, clarify education, enterprises and trade unions, and organize employment incentives with priority given to micro, small and medium-sized enterprises and low-productivity sectors.
It is also necessary to improve labor intermediation through more active employment offices and create forums for tripartite dialogue to adapt policies to local realities.
For this reason, Segment your social charge Depending on company size or salary level to introduce progressivity in labor costs.
Currently, small businesses pay essentially the same percentage as multinationals, and low-income workers contribute the same percentage as high-income workers.
There is a partial relief package, but it is not a progressive structure that will give wind to small businesses and improve the distribution of contributions. This recursive scheme prevents formalization. a A more progressive system could also help small businesses.strengthen new employees and better distribute the load.
The government appears to be aiming for this in its proposed changes, which are expected to be submitted to parliament in mid-December.
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