Company childcare rules relaxed after industry pressure

Companies will have to provide kindergartens only if they have over 100 employees, and can pay in cash instead

After an objection from the Argentine Industrial Union (UIA), the government will allow companies with more than 100 workers to postpone the installation of kindergartens for their employers’ children beyond a March deadline, when they were expected to be in full operation. 

Labor minister Raquel “Kelly” Olmos confirmed that companies that don’t have daycare facilities in place by March 23 will have to, at a minimum, compensate its employees with cash.

According to Olmos, relaxing the decree that finally regulated the creation of daycare centers after almost half a century will aim to get companies that requested a deferral “to negotiate and reach an agreement” with trade union representatives on the conditions for complying with the rule “within a timeframe yet to be defined”. 

“Meanwhile, they have to pay the reimbursement”, she said of the compensation, which equals at least 40% of the salary of a care worker, according to the labor agreement for domestic workers. 

UIA started to negotiate last summer to stop the enforcement of Decree #144/22 signed by Alberto Fernández last year, which regulated article 179 of the Employment Contract bill that establishes employers’ obligation to offer kindergartens to private sector employees. The government did so after the Supreme Court ruled in favor of establishing a rule on the issue. 

The regulation, which had been pending since 1974, included an initial concession towards companies by limiting its application to businesses with more than 100 employees. It offered another by allowing companies to replace that benefit with a cash payment. These concessions were the result of conversations between UIA and the staff of previous Labor minister Claudio Moroni. 

However, the institution claimed that despite being consulted, the regulation still presented “complexities in its interpretation and the possibility of applying it”, as UIA president Daniel Funes de Rioja said.   

“We believe the interpretation of this regulation is pretty simple. Still, we are willing to provide any explanations necessary, and in fact we are working on a clarifying rule that will provide a framework for the interpretation of whatever doubt may arise,” Olmos answered. 

According to the minister, “in such cases where there is no kindergarten provision, there will be a compensation payment (established in the regulation) for a period of time, until the parties can negotiate” a definitive plan to provide care for their employees’ children.  

Other items in that clarifying regulation would specify that “if there are employees working under a contract that is not covered by a labor agreement (in the same productive unit) they shall have the same benefit as those under the agreement” of that activity. Meanwhile, employees “working remotely” will receive the reimbursement as a tax-free cash payment. Also, the text will stress that those companies that have already established a daycare center or agreed on compensation with its union representatives shall be able to continue with the same mechanism, as long as the amount is not less than the regulation established.

Originally published in / Translated by Agustín Mango


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