Emergency Decree No. 669/2019

The Decree sets three amendments in relation to the previous wording, which had been introduced by Law No. 27,349, issued in 2017:

1. The Decree establishes that from now on the Health and Social Development Ministry will be the authority in charge of preparing and issuing the RIPTE (average taxable compensation of stable workers) update rate. Until now, the rate had been published by the Social Security Secretariat of the Labor Ministry, as established in Section 8 of Law 27,663, issued in 2012.

2. The Decree also modifies the update rate of the monthly income used for the calculation of the compensations granted to the employees for definite labor disability or death. The Law modified in 2017 had established that “From the date of the first appearance of the inability and until the time of the calculation of the compensation for determination of the definitive labor disability, death of the employee or approval, the amount of the basic monthly income will accrue an interest equal to the Banco de la Nación Argentina average of the active general portfolio nominal annual rate due thirty (30) days”. The Decree now sets forth that the rate for such period will be “an interest equal to the variation rate of the RIPTE in the period considered”.

The Banco de la Nación Argentina 2018 active rate amounted to 40.63%, whereas the RIPTE rate was of 27.1%. Consequently, the Decree reduces the update of the compensations to be paid in the abovementioned cases.

The amendment of the update rate is only for the update of the monthly income during the period from the first appearance of the inability until the moment in which the Labor Risk Insurer (“ART”) has to comply with the obligation. On the contrary, the Decree maintains the Banco de la Nación Argentina active interest rate from the moment in which the ART fails to comply until the effective payment of the due obligation.

3. Finally, the Decree amends the wording of Section 12, which in its previous wording established that the date to consider as the start the default was “the moment of the calculation of the compensation for determination of the definitive labor disability, death of the employee or approval”, whereas the Decree establishes that said moment will be “the date in which the ART has to provide the compensation for determination of the definite labor incapacity”. We understand that this amendment is an adaptation of the previous regulation to the amendments introduced by Laws 26,773 and 27,348 to the general risk regime. It is important to highlight that the obligation to make the payment of the due compensation available, according to Section 4 of Law No. 26,773, is set within 15 days as from the “notification of the death of the employee, or of the approval or determination of the incapacity to work of the victim of a labor-related accident or occupational disease”.