BusinessGovernmentLabor

Work Contract Suspension vs Reduction of Work schedule.

Work Contract Suspension

Reduction of Work schedule

What does it mean?

Employee: Suspension of his obligation to provide services.

Employer: suspension of his obligation to pay salaries.

The employer can modify the work contract and reduce the work schedule, if he demonstrates an affectation as a result of COVID19. 
How and when these apply?  It must be requested before the Department of Labor. The employer must demonstrate a situation of force majeure that affects or prevents the company from continuing to operate. Once the employer can demonstrate a decrease of at least 20% in the company’s gross income and that it is attributable to the National emergency.
Applicable

To any type of contract.

The salary can be reduced up to 50% if the loss of gross income is at least 20%.

The salary can be reduced up to 75% in the loss of gross income is at least 60%.

Department of Labor (MTSS)

Must approved the request.

Must be approved by the MTSS.

Requirements

File the request within the three following days to the fact that originated the suspension.

Affidavit extended by an attorney explaining the reasons to request the measure.

Full name, email of all employees affected.

Indicate of the expected term.

Affidavit extended by the legal representative or a CPA. List of the people affected by the measure. 
Employees Will not receive salary during the term the contract is suspended. 

 

Will receive their salary proportionately to the working day.

 

 

By MJGT.

Supply, Demand and the COVID-19.

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María José González

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