Amendment of the Employment Contract Law

Section 66 of the Employment Contract Law (“ECL”) entitles the employer to make any changes in the terms and conditions of employment, provided that such changes are not unreasonable or alter essential contractual terms or cause a material or moral damage to the employee. Such power is called "ius variandi".

Before the amendment, section 66 of the ECL established that should the employer take any measure prohibited by this section, the employee could consider themselves dismissed without cause.

The amended section sets forth that, in case of abuse of the "ius variandi" by the employer, the employee may either consider themselves dismissed without cause or file an action in court to reestablish the modified terms and conditions of employment. In this last case, the action shall be decided in a specially expedited summary proceeding (“procedimiento sumarísimo”) and the terms and conditions of employment shall not be modified until final judgment is rendered except if such terms and conditions of employment generally apply to the whole company or section.