Family allowances: amendments and increases

Law No 24,714, amended on various occasions, created what is known as the Family Allowance Schedule. Among many amendments, it is important to point out Resolution No 14/02 passed by the Office of Social Security. This resolution determined the replacement of different regulatory norms covering the Family Allowance Schedule with a new set of norms. The intention of the Office was to bring together in one volume the body of regulations covering the Family Allowance Schedule, in order to facilitate consultation and avoid confusion in relation to its application.

Moreover, Decree No 368 is effective as of March 1, 2004, partially reforming Law No 24,714, and introducing several different amendments in the schedule. Among these amendments we can mention the change in the cap for remuneration and the range established to quantify the amount of the benefit to be paid to the workers, the beneficiaries of the Workers' Compensation Law and the beneficiaries of the Unemployment Benefit, under the provisions of Law No 24,174. Moreover, calculation of the semester average of remuneration was replaced by a monthly calculation of the remuneration collected by the workers, the beneficiaries of the Workers' Compensation Law, the beneficiaries ofunemployment insurance and the beneficiaries of the Integrated Pensions and Death Benefits System (SIJP). The notion of remuneration was also modified in relation to collection of family allowances and excluding the yearly bonus payment.

Given the amendments made by Decree No 368, the Office of Social Security on December 1, 2004 published Resolution No 60/04 in the Official Gazette modifying and extending the earlier Resolution No 14/02.

Among the amendments introduced by the Office, we note the following:

1. Minors

Family allowances will be paid for dependent children under 18 years of age, except when the minors are born out-of-wedlock and still dependent. In that case, only payment of the family allowance per child, disabled child and yearly school allowance is applicable.

2. Allowance payment

In relation to the months during which the allowances are to be paid, the Resolution adds that, in relation to the allowance for spouse, or disabled spouse, the allowance is to be paid during the month of marriage, divorce or separation, death or cessation of disability of the spouse, inclusive.

Moreover, reference is made to the fact that in all cases payment of family allowances is applicable up to and including the month during which the beneficiary of the benefit dies.

3. Parental option

When both parents are eligible for collection of family allowance, the parent collecting the higher amount may choose to be the beneficiary. The option can only be exercised once every four months during the calendar year, or each time a new contract of employment is entered into.

It is important to point out that Resolution No 14/02 allowed for taking the option twice per calendar year, but only once per semester.

4. Pensioners’ option

Pensioners that are in activity may choose to collect their family allowance through whichever of the applicable schemes is most beneficial to them. Nevertheless, the resolution determines that they can only exercise the option once every four months during the calendar year or every time they enter into an employment contract.

5. Remuneration to be considered

In relation to the family allowances to be collected, the following situations must be contemplated:

a) When an employment contract is entered into, the remuneration collected for that month must be considered in order to determine the right to collectthe family allowance and the amount thereof.

b) In relation to the collection of family allowances by beneficiaries of pensions and death benefits, paid by the State Pension System (distribution schedule), by first wages is understood the amount established by the ANSES as monthly wages, excluded the retroactive credit that could be applicable.

c) To the effect of collection of the family allowances by beneficiaries of pensions and death benefits paid by the capitalization scheme with no state component, by first wages is understood the amount determined by the AFJP Pension Funds as the first wages in installments for inclusion in the system, valued in Argentine pesos at the value of the installment used for inclusion in the system.

d) To the effects of collection of family allowance by beneficiaries of pensions and death benefits paid by the capitalization scheme with a state component, by first wages is understood the amount resulting from the addition of the monthly wages for inclusion determined by ANSES for the Public Pension Scheme benefits and the monthly wages for inclusion determined by the AFJP Pension Fund for the individual capitalization account.

6. Seniority calculation

For calculation of seniority, any month in which the worker collected an amount of not less than A$ 100 is considered a full month.

7. Prenatal allowance

Notwithstanding the necessary events described in Resolution Nº 14/02, the new resolution adds that for prenatal allowance, the date of conception will be considered as a generating event.

The Resolution also adds that the seniority required for collection of the prenatal allowance must be computed one month after occurrence of the generating event.

8. Geographical area

- For workers, the amount of the family allowance will be referred to the geographical area declared before the AFIP.

- For beneficiaries of Workers' Compensation Law that are not under contract of employment, the address of residence of the injured worker is to be taken into account.

9. Accreditation of disability. Exceptions

The allowance per disabled child will be paid against a prior authorization issued by ANSES, authority that will proceed to carry out the corresponding medical verification.

This medical verification is not necessary when the children are beneficiaries of a pension or death benefit by disability; or when the disability is accredited with a certificate; or when a Firm Medical Report exists produced by a Medical Committee; or when a declaration of insanity exists produced by a Court decision.

10.Children born out-of-wedlock

In the event of children born out-of-wedlock that have been acknowledged by both parents but whose parents do not live together, the family allowances may be claimed by the parent exercising de facto custody. Accreditation of custody of minors may be completed by means of a Legal Summary Report.

11.Supportive documentation

Resolution No 60/04 introduces several amendments in relation to the documentation that is to be filed in order to collect the corresponding family allowance.

On the other hand, as of October 1, 2004, Decree Nº 1691/04 is in effect having been published December 2, 2004, whereby an increase of 50% in some of the family allowances was decided and awarded as follows:

a) Allowance per child:

- A$ 60 for workers that receive a remuneration of from A$ 100 to less than A$ 725;

- A$ 45 for those receiving remuneration of from A$ 725 and less than A$ 1,225 and

- A$ 30 for those receiving a remuneration of from A$ 1,225 to A$ 2,025.

b) Allowance per disabled child:

- A$ 240 for workers receiving remuneration lower than A$ 725;

- A$ 180 for those workers receiving remuneration of from A$ 725 and less than A$ 1,225; and

- A$ 120 for those receiving remuneration as of A$ 1,225.

c) Allowance per child and per disabled child for beneficiaries of the Integrated Pensions and Death Benefits System (SIJP):

(i) Allowance per child:

- A$ 60 for beneficiaries receiving salaries/wages of less than A$ 501;

- A$ 45 for those receiving salaries/wages of from A$ 501 and less than A$ 1,001; and

- A$ 30 for those receiving salaries/wages from A$ 1,001 and less than A$ 1,501.

(ii) Allowances per disabled child:

- A$ 240 for beneficiaries receiving salaries/wages of less than A$ 501;

- A$ 180 for those receiving salaries/wages of from A$ 501 and less than A$ 1,001; and

- A$ 120 for those receiving salaries/wages as of A$ 1,001.

Moreover, an increase is set for the remuneration caps established by article 3 of Law No 24,714. Therefore, as of October 1, 2004, those workers collecting remuneration greater than A$ 2,025 and A$ 2,375 according to their geographical area are excluded from the family allowance system, save for allowances for pregnancy and disabled children.