Labor Modernization Law Now Regulated

On June 1, 2026, the Argentine Executive Branch, through three decrees, regulated matters related to employment registration, pay slips, social benefits, supplementary benefits, medical certificates, resignations, termination agreements by mutual consent, retirement proceedings, collective bargaining, union associations, temporary staffing agencies, the Labor Assistance Fund (FAL), and the Registered Employment Promotion Regime (PER).

The most relevant points include:

Employment registration

Employment registration will be complied with by registering and deregistering employees in the Argentine Tax Authority’s (ARCA) system. Other administrative authorities may not impose additional requirements. The decrees also provide that employers will not be required to keep labor books in physical or digital format.

Regarding pay slips, the decrees provide that they must be structured in four separate sections and include, among other information, a detail of the contributions and items the employer pays pursuant to legal or collective bargaining provisions. They must also include a summary of the total labor cost composition, breaking down employer-paid items such as social security, health insurance, occupational risk insurance (ART), union-related items, business chambers or employer entities, and others.

Social benefits

The decrees also address certain social benefits and supplementary benefits. They establish that meal services outside the employer’s establishment may only be implemented through a benefit or provision funded directly by the employer, may not be replaced by cash, and will be subject to a monthly cap of 40% of the minimum wage. They also set a cap of 5% of the employee’s annual gross remuneration for certain profit-sharing or gain-sharing systems, stock rights, dividends, or the disposal of shares or securities granted by the employer.

Absenteeism

With respect to the control of non-work-related illnesses and accidents, the regulations provide that any medical prescription be issued electronically through platforms duly registered with authorities and signed by professionals duly authorized. Paper certificates will be accepted as an exception. In the event of an irreconcilable discrepancy between the initial diagnosis and the employer’s medical control, the parties may refer the matter to an official medical board or request an opinion from public or private institutions of recognized standing.

Termination of employment

In relation to employment termination, the Labor Authority is instructed to issue supplementary regulations to implement the resignation procedure before such labor authority, including its registration and effective notice to the employer. The decrees also clarify that mutual termination agreements submitted before the administrative authority may be approved after verifying their legality, the absence of defects in consent, and the adequate composition of the parties’ interests.

Retirement

The Social Security Authority must notify employers and agents of the Argentine Health Insurance System when retirement proceedings open and close. This provision will be relevant to manage retirement notices and for employers, social security, and health coverage providers to coordinate processes.

Collective labor relations

In collective matters, the regulations establish criteria for calling for the renegotiation of expired collective bargaining agreements. When the agreement does not provide an express expiration date or validity period, the enforcement authority may use December 31, 2026 as the reference date. The Labor Authority is also instructed to initiate the calling procedure within 30 days from the effective date of the decree.

The regulations also address matters related to employer representation in collective bargaining, providing that employer associations and chambers must prove sufficient representation, which may not be lower than 10% of the employees included in the personal and territorial scope of the bargaining process. In collective bargaining agreements covering more than one jurisdiction, the enforcement authority may admit up to two additional employer-side representatives.

In terms of contributions, dues, withholdings, funds or other economic charges in favor of signatory parties or collective entities, these must be computed globally to verify compliance with legal caps, and the Labor Authority will not approve agreements exceeding those caps.

The decrees address various aspects of union associations operation and representation, including reasonable proportionality between the members of governing bodies and dues-paying members, verification of membership lists in public databases, proof of dues-paying members, the use of union leave hours, the enforceability of union candidacies against the employer, and the cases in which an employer may seek judicial suspension an employee with union protection.

Labor intermediation

The decrees approve a new framework for temporary staffing agencies and repeal Decree 1694/2006. The new regime governs registration, guarantees, the relationship between the temporary staffing agency, discontinuous permanent workers and user companies, the cases in which this hiring modality may be used, and the consequences of operating without authorization.

Fund of paying severance and other termination costs

The decrees define the operational aspects required for implementing the Labor Assistance Fund (FAL), including the contribution scheme, fund administration, and payment procedures. They also confirm that the resources must be managed through investment vehicles authorized by the Argentine Securities Commission and establish general rules for their operation. However, several supplementary regulations remain pending for the regime’s effective implementation.
 

Regularization of labor relationships

The regulations put into operation the regime for regularizing unregistered or deficiently registered employment relationships, known as the Registered Employment Promotion Regime (PER). Among other aspects, the regime provides significant social security benefits, including waivers of principal and interest debt ranging from 70% to 90%, and even reaching 100% for certain items. Enrollment in the regime may also have relevant labor, social security, administrative and criminal effects, making it a tool that should be assessed by employers with historical employment registration or social security contingencies.