Decree No. 946/16, issued by the AFIP and the MTEySS, extends for 12 months the validity of Law No. 26,940, issued on June 2, 2014 in the Official Gazette, which primarily aims to promote the registration of employment and the prevention of occupational fraud.

The main aspects regulated by Law 26,940 are included as follows.

I. Public Registry of Employers with Labor Sanctions ("REPSAL")

Law 26,940 provides the establishment of the Public Registry of Employers with Labor Sanctions (REPSAL), where the following information will be published:

a) Offenses caused by the lack of registration of the employer, lack of registration of workers or obstructing labor inspections, imposed by the Labor, Employment and Social Security Ministry ("MTEySS"), the Tax Authority ("AFIP"), the Superintendence of Occupational Risks ("SRT"), the Argentine Register of Agricultural Workers and Employers ("RENATEA"), and the provincial and the City of Buenos Aires authorities.

b) Final or enforceable judgments stating that the plaintiff is a worker whose employer does not acknowledge his or her dependent employment relationship, or with a first day of work that differs from the alleged registered date.

The sanction will be published in REPSAL for a maximum of 3 years. Sanctioned employers, while included in REPSAL, will not have access to programs, development or assistance actions, benefits or subsidies administered, implemented or financed by the Argentine Government; access to credit lines granted by public banks; enter into contracts of sale, supply of services, locations, consulting, rent with buying option, swaps, concessions for use of property of the Argentine Government public and private domain, or participate in public works, public works concessions, public service concessions and licenses; access to special schemes to promote registered employment under Law No. 26,940.

II. Special Scheme of Registered Employment Promotion

Law No. 26,940 establishes the following benefits of employer contributions reductions:

a) Permanent Scheme of Contributions to Social Security for Micro-employers: it includes individuals, de facto corporations and limited liability companies employing up to 5 workers provided their annual turnover does not exceed the amounts established by the regulation. It will rise to 7 workers when the employer produces an increase in the existing campus workforce at the time of inclusion in the scheme.

The employer covered by this regime must enter for each of its indefinite term workers, 50% of employers' contributions established in the general scheme destined for the Argentine Pension , the Argentine Institute of Social Services for Pensioners, the Argentine Employment Fund, the Argentine Family Allowance Scheme and the Argentine Register of Agricultural Workers and Employers.

b) Scheme for Promotion of Employment of Registered Employment: it covers employers who have up to 80 employees, with respect to new employees that produce an increase in payroll, and it is extended for 24 months from the employment's beginning. For this employment relationship, employers will have a reduction in employer contributions established in the general scheme destined to the Argentine Pension System, the Argentine Institute of Social Services for Pensioners, the Argentine Employment Fund, the Argentine Family Allowance Scheme and the Argentine Registry of Agricultural Workers and Employers.

For employers staffing up to 15 employees, the benefit will be that, during the first 12 months of the employment relationship, those mentioned contributions will be paid for and, for the second 12 months, 25% will be payable.

For employers with 16 to 80 workers, the benefit will be that during the first 24 months of employment, 50% of the aforementioned contributions will be paid for.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.