{"id":217805,"date":"2020-07-12T12:41:58","date_gmt":"2020-07-12T15:41:58","guid":{"rendered":"https:\/\/cspabogados.com.ar\/?p=217805"},"modified":"2026-08-19T13:01:18","modified_gmt":"2026-08-19T16:01:18","slug":"termination-of-employment-in-argentina","status":"publish","type":"post","link":"https:\/\/cspabogados.com.ar\/en\/termination-of-employment-in-argentina\/","title":{"rendered":"Labor Guide to Doing Business in Argentina: termination of employment in Argentina. Post-employment restrictive covenants"},"content":{"rendered":"\n

Labor Guide to Doing Business in Argentina: termination of employment in Argentina. Post-employment restrictive covenants<\/h1>

by Mario Eduardo Castro Sammartino<\/a><\/span> | 12 Jul 2020<\/span><\/p><\/div><\/div><\/div>

Under Argentine law, there are different grounds for termination of employment in Argentina.<\/p>\n

(i) Termination without cause\u00a0<\/strong><\/p>\n

An employer terminating an employment contract without cause must serve the employee with an advanced written notice whose length depends on the following seniority:<\/p>\n

a) 15 days, if the employee is under the three-month trial period;<\/span><\/p>\n

b) 1 month, if the employee has worked for up to 5 years; and<\/span><\/p>\n

c) 2 months, if the employee has worked for more than 5 years.<\/span><\/p>\n

Failure to give such prior notice, entitles the employee to\u00a0compensation in lieu of prior notice<\/strong>\u00a0equal to 15 days, one monthly salary, or two monthly salaries, depending on each case.<\/p>\n

Except if the employee is under trial period, the employer must additionally pay a\u00a0seniority compensation<\/strong>whose basis is the best regular monthly salary accrued during the last year of service multiplied for each year of employment, or period exceeding three months. Such a basis has a cap equivalent to three times the average of all wages provided by the applicable collective bargaining agreement. In no case shall the seniority compensation be less than one employee\u2019s gross monthly salary.<\/p>\n

When the termination of the employment does not take place on the last day of the month, the employer must also pay the salary equivalent to the remaining days until the end of such month.<\/p>\n

Finally, the employee is entitled to compensation for the annual leave not taken (the annual holiday to which the employee would have been entitled according to the period of the year worked until termination), and the proportional amount of the annual extra salary.<\/p>\n

There exist special protections for certain cases:<\/p>\n

a) Union leaders: cannot be dismissed without cause during their term and one year afterward;<\/span><\/p>\n

b) Women getting married: if they are laid off within 3 months before the marriage or 6 months afterward, the employer must pay an additional severance compensation equal to 13 monthly salaries;<\/span><\/p>\n

c) Pregnant women: provided that they are fired seven and a half months prior to delivery or afterword, the employee is entitled to an additional severance compensation equal to 13 monthly salaries;<\/span><\/p>\n

d) Sick employees: further to the compensations for termination without cause, dismissed sick employees may claim the salary corresponding to the time remaining to complete the paid leave provided by law<\/span><\/a>[1]<\/a>.<\/span><\/p>\n

(ii) Termination for gross misconduct<\/strong><\/p>\n

The employer may terminate the employment contract based on gross misconduct (just cause), if the employee has incurred in a breach of his\/her duties severe enough not to consent to the continuation of the labor relationship.<\/p>\n

The employer may terminate the employment contract based on gross misconduct (just cause), if the employee has incurred in a breach of his\/her duties severe enough not to consent to the continuation of the labor relationship.<\/p>\n

The contract of employment law does not list specific breaches that justify dismissal, and therefore the issue should be analyzed on a case by case basis, evaluating, among other circumstances, the employee\u00b4s prior disciplinary records, his \/ her seniority, and rank, etc.<\/p>\n

No compensation is due to the employee in the case of dismissal for just cause.<\/p>\n

If the employee judicially challenges the dismissal, and it is found that the alleged cause was false or not sufficiently significant to give grounds for termination, the employer must pay all the severance compensations. In this case, additional compensation will be imposed over the employer equal to 50 percent of the seniority and in lieu of prior notice compensations.<\/p>\n

(iii) Other grounds for termination<\/strong><\/p>\n

a) Resignation<\/span><\/p>\n

Employees may step down at any time, just giving the employers a 15-day prior notice, or paying a 15-day salary compensation.<\/p>\n

b) Death of the employer or the employee<\/span><\/p>\n

The compensation is half the seniority compensation provided for the dismissal without cause.<\/p>\n

c) Retirement<\/span><\/p>\n

When employees are 70 years old and have 30 years of contributions to the social security system, the employer is entitled to request the employee start the paperwork to obtain retirement benefits, delivering his \/ her working certificates. The employer must then maintain the employee under its payroll until either the employee obtains retirement, or for one year since the employee was served notice (whatever occurs first).<\/p>\n

Once the employee obtains his \/ her retirement benefit, or the one-year term has elapsed, the employer may terminate the employment contract without paying any severance compensation;<\/p>\n

d) Lack of work and force majeure<\/span><\/p>\n

In the case of lack of work beyond the employer\u2019s responsibility, force majeure, or technological causes, the employer may dismiss the employee, paying half the seniority compensation. This ground for termination has been very restrictedly deemed by the Courts.<\/p>\n

(iv) Unregistered labor relationships<\/strong><\/p>\n

If the labor relationship is unduly registered (e.g. with a commencing date later than the real one, or a salary inferior to the amount the employee really collects), there are significant additional compensations.<\/p>\n

(v) Redundancies<\/strong><\/p>\n

Before executing collective layoffs affecting certain minimum numbers of employees , the employer must undergo a prior crisis prevention procedure, with the labor national or provincial authorities, governed by Law N\u00b0 24.013.<\/p>\n

(vi) Post-employment restrictive covenants<\/strong><\/p>\n

Post-employment restrictive covenants preventing an ex-employee from competing, soliciting clients, poaching employees, and divulging the company\u00b4s confidential data are not expressly regulated under Argentine law.<\/p>\n

Any post-employment agreement limiting competitive activities or imposing non-solicitation, either directly or through indirect means (e.g. forming a company with the same former employer\u00b4s activities) must be balanced with the constitutionally protected right to work.<\/p>\n

In the few existing caselaw on the subject, the validity of non-compete provisions after the termination of employment has been subordinated to the existence of a time and scope (outlining territory and\/or activities) limits, and fair consideration. This rule would also apply to customer solicitation.<\/p>\n

 <\/p>\n

 <\/p>\n

Mario E. Castro Sammartino<\/p>\n

For additional information on these or any other issues related to doing business in Argentina, please,\u00a0sign up<\/a>\u00a0for our Legal Blog or\u00a0contact us<\/a>\u00a0at any time.<\/p>\n

Our publications exclusively express the\u00a0author\u00b4s opinion and do not purport to be legal counsel on any case. Should\u00a0you need it, you must consult with your trusted lawyer.<\/p>\n

<\/a>[1]<\/span><\/a>\u00a0See\u00a0https:\/\/cspabogados.com.ar\/en\/salaries-and-working-conditions-in-argentina\/<\/a><\/p>\n

<\/a>[2]<\/span><\/a>\u00a0The crisis prevention procedure must be requested when the redundancy affects: a) More than 15% of the total payroll in companies with less than 400 employees; b) More than 10% in companies with more than 400 and less than 1,000 employees; and c) More than 5% in companies with more than 1,000 employees.<\/p>\n

 <\/p>\n<\/div><\/div><\/div><\/div><\/div>

<\/div>