23 October 2009

Settling Employee Conflicts in SECLO

I sometimes think the employee/employer relationship in Argentina is set-up to deliberately generate conflicts. As an employer, you will find that it is only a matter of time until these labor conflicts rear their ugly head. When they do occur, the best option is to resolve them quickly, removing the employee and ensuring that the employee's legal options are limited.

As any employer in Argentina will tell you, labor conflicts are expensive. I know Argentines who have purchased apartments with the money they have won in labor disputes. Worse yet, every employee knows that the labor court judges are on their side and that employees win well over 90% of labor lawsuits.

After deciding to remove an employee, if you can come to an arrangement with him or her, a good option to use is the Labor Ministry's SECLO (Servicio de Conciliación Laboral Obligatoria) service. You will need to put the agreement in writing, fill out a form to request a date, and go personally with the employee to the Labor Ministry at Callao 110. Both the employee and the employer should be represented by council. In practice, two lawyers from the employer should be used to avoid complications. If you allow the employee to bring his own lawyer, you're just opening a door to further claims.

At the end of this process, the Labor Ministry will endorse the signed agreement and it becomes equivalent to a court judgment. The employer is obligated to pay the amount agreed upon and the employee gives up his or her right to any future legal remedies against the employer. It is important to note that the employer never admits to any kind of guilt or responsibility in these agreements, so they cannot be used as proof for other claims by third parties (i.e. the tax office, social security agency, other employees, etc).
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29 September 2009

Who Can Join Monotributo?

Today's question comes from a reader with a "visa precaria" and he wants to know if he can join the monotributo system.

Reader's Question
Whilst you have said that you can not be a monotributista without a DNI, i would like to know if you can get one whilst awaiting your permenant residency. I am married to an Argentine and awaiting my papers - i have my 'Residency de Precaria' - will that be enough??
Who Can Join Monotributo
A "visa precaria" is just that, a precarious visa. The government is giving you a little bit of time for you to regularize your situation and get a real visa. A visa precaria doesn't entitle you to a DNI, since it isn't a residency visa. What you need to do is get a residency visa, either temporary or permanent, and then you can get your DNI and enroll in monotributo.

I had a temporary visa my first three years in Argentina and then changed to a permanent visa. During those years as a temporary resident, however, I could get a CUIT, open a bank account, invest in companies, enroll in monotributo, etc. A temporary residency visa allows you to do all those things. A visa precaria will not, however, since it isn't a residency visa.
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21 September 2009

Your Business' Official Address

When registering your new business for the first time in Argentina, you will be asked to prove that your business is operating at a certain location. However, it is not enough to simply declare your address. You will need to "prove" it. This is done through a rental contract, presenting utilities in your business' name, a declaration from a public notary (escribano) etc. Before the government will give your business a tax id number (CUIT), you will need to prove its address.

This is sometimes difficult for new businesses, since just about everyone will ask you for your business' CUIT number before they will put any kind of service in the business' name or sign a rental agreement. These kinds of requirements will sometimes generate chicken and egg type situations where you can't start doing business until you have a CUIT, but you can't get a CUIT until you prove you are doing business.

The most complicated situation is when you try to declare an address that has already been declared for an existing business. The government will want to know why two businesses are operating at the same address, so be prepared to reply officially with the supporting documentation. In cases where this has been an issue for me, we have always resolved the issue by declaring the company to have the home address of one of the partners (assuming no other companies have been registered at that address) and then changing the company's official address after having been issued a tax id (which can be done simply over the internet).
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