The Supreme Court decided on the entry into effect of the Emergency Law

1.   Introduction

In the case in question(1), on January 7, 2002, the defendant discharged the plaintiff and paid the severance pay according to the law in force at the time, that is, without duplicating said severance pay.

The plaintiff later filed a suit claiming payment of a double severance pay according to the provisions of article 16 of Law No 25,561 and Decree No 50/02.

The defendant denied being obliged to pay this concept, claiming that Decree No 50/02 was unconstitutional. The defendant alleged that, at the time of deciding to discharge of the plaintiff -January 7, 2002-, the double severance pay was not in effect, given that Decree No 50/2002 was passed after the discharge: January 8, 2002.

2.   Law No 25,561 and Decree 50/02

In order to understand the substance of the issue, it is necessary to go back and analyze Law No 25,561 and Decree No 50/02.

Law No 25,561 was passed on January 6, 2002 and published in the Official Gazette on January 7, 2002, without expressly providing for the date of its entry into effect. In this condition, the provisions of article 2 of the Civil Code establishing the obligatory nature of laws eight days as of publication thereof were operative.

Later, the Executive passed Decree No 50/2002 (Official Gazette January 9, 2002), whereby it established January 6, 2002 as the date of entry into effect of the Law, that is, one day before its publication. This rule passed by the Executivewas found to be unconstitutional in that, on deciding the retroactive application of Law No 25,561, it would affect acquired rights under the terms of article 17 of the Constitution.

This Decree was found to be unconstitutional by the majority of the Tribunals of the Labor Court of Appeals. Among the arguments stated, it was noted that Decree No 50/02, on establishing the retroactive nature of the norm, went against the principle of legal certainty and affected acquired rights.

Nevertheless, other tribunals of the Labor Court of Appeals found for its constitutionality pointing out that discharge of employees goes against the principle of good faith by virtue of the fact that the extension of double severance pay had been published in the formal records and in the media and therefore management could not be unaware of its provisions.

3.   Valente’s case

Tirbunal III of the Labor Court of Appeals rejected the complaint confirming the decision of First Instance. The decision finds for the unconstitutionality of Decree No 50/02 in that it was passed at a time when Congress was not in recess and it was not credible that the situation confronted on passing the Law of Emergency, invoked as the grounds for the Decree, had worsened to an extent such that it could justify an Executive Decree passed on the basis of the need and urgency of the crisis.

Against this decision the plaintiff filed an extraordinary plea before the Supreme Court invoking that the decision incurred in arbitrariness and configured a strict federal question affecting the guarantees of articles 16, 17, and 18 of the Constitution.

The State Attorney understood that Decree No 50/02 was directed at remedying a general deficiency of Law No 25,561 -not expressly establishing the date of effectiveness-, and not of one of the articles in particular, underlining that the social, economic and financial scenario and the acute crisis that the country was undergoing, required the integral and urgent effectiveness of the Law No 25,561.

On the other hand and without directly deciding on the substance of the issue, the Court understood that the plaintiff was right in that the decision of the Court of Appeals had incurred in arbitrariness given that it had omitted examination of the issue whereby article 16, of Law No 25,561, regardless of Decree No 50/02, must be interpreted as effective at the time of the discharge, given the particular aims pursued and the consequences that could result from any delay in the application of the law.

On the other hand, Justices Boggiano, Maqueda and Zaffaroni, although they underwrote the opinion of the majority vote, added that article 16 of Law No 25,561 must be interpreted as effective at the time of the discharge by virtue of the principle of good faith, on which the Court had put particular emphasis in previous precedents.

4.   Conclusion

Although the Supreme Court did not rule in favor of the constitutionality of Decree No 50/02, what would appear to arise from the decision is the intention of finding as the date of entry into effect of Law No 25,561, January 6, 2002, a criteria that the State Attorney clearly adheres to.

In fact, on March 15, 2005, Tribunal III of the Labor Court of Appeals in the decision "Barreiro Marcelo vs. Banco Bansud S.A. Grupo Macro", modified the position upheld in the decision that we are discussing and although it understands that Decree No 50/02 is unconstitutional, for reasons of economy and procedural celerity, the Court of Appeals followed the criteria of the Supreme Court, without prejudice to their personal opinion.