Increase of Minimum Wage and Unemployment Benefit

On September 2, 2019, Resolution 6/2019 of the Production and Labor Ministry was published in the Official Gazette. It establishes an increase in the minimum and vital wage (the “SMVM,” after its acronym in Spanish) and in unemployment benefit.

As per the resolution, the minimum and vital wage will be incremented from ARS 12,500 to ARS 16,875 in a progressive and non-cumulative manner. The raise will be applied in September and October 2019 with a retroactive increase on August 1, 2019, under the following schedule:

1. From August 1, 2019, it was ruled that the minimum and vital wage will amount to ARS 14,125 for those employers who receive a monthly salary and whose working days are established as per the Section 16 of the Labor Contract Law (“LCL”) except in those cases mentioned in Section 92 and 198 therein. They will receive the increment proportionally. A raise to ARS 70.62 per hour was implemented for those employers who are paid under another payment schedule.

2. From September 1, 2019, the minimum and vital wage will amount to ARS 15,625 for those employers who receive a monthly salary and whose working days are established as per the Section 16 of LCL except in those cases mentioned in Section 92 and 198 therein. They will receive the increment proportionally. A raise to ARS 78.12 per hour was implemented for those employers who are paid under another payment schedule.

3. From October 1, 2019, the minimum and vital wage will amount to ARS 16,875 for those employers who receive a monthly salary and whose working days are established as per the Section 16 of LCL except in those cases mentioned in Section 92 and 198 therein. They will have the increment proportionally. A raise to ARS 84, 37 per hour was implemented for those employers who are paid under another payment schedule.

Moreover, minimum and maximum amounts paid in unemployment plans will undergo changes as follows:

a. From August, 2019, the minimum amount will be ARS 3,285.51 and the maximum will be ARS 5,256.83.

b. From September, 2019, the minimum amount will be ARS 3,634.41 and the maximum will be ARS 5,815.08.

c. From October, 2019, the minimum amount will be ARS 3,925.17 and the maximum will be ARS 6,280.28.