Employment contracts and severance under the 2026 labor reform

Key rules

Scope: who is covered by the LCT

The LCT applies to private sector employment. It does not apply to public administration staff (unless expressly included), domestic staff under Law 26.844, agricultural workers (supplementary application only), civil and commercial contracts for works, services, agency, transport and freight, independent workers and their collaborators under Law 27.742 art. 97, independent providers on technology platforms, seafarers under Law 20.094 and persons deprived of liberty (LCT art. 2, as replaced by Law 27.802, art. 1).

The presumption that the provision of services implies an employment contract applies to "services in a situation of dependence" and does not apply where works or professional services are contracted and invoices or receipts are issued, or payment is made through the banking system as the regulation provides; this exclusion extends to social security (LCT art. 23, as replaced by Law 27.802, art. 13). An independent worker may work with up to three other independent workers under a special unified regime, provided the typical notes of dependence (technical, legal or economic) are absent (Law 27.742, art. 97).

Key rules with article cites

1. Contract types

2. Probation period

• Length: first 6 months of an indefinite contract; extendable by collective agreement to 8 months (6 to 100 workers) or 1 year (up to 5 workers) (LCT art. 92 bis(a) and (b)). Domestic staff: 6 months (Law 26.844, art. 7, as replaced by Law 27.802, art. 107). Indefinite agricultural workers follow LCT art. 92 bis (Law 26.727, art. 16, as replaced).
• Termination: either party, without cause and without severance (art. 92 bis). No notice is required (art. 231(b), last paragraph) and no "month of dismissal" integration is owed (art. 233, last paragraph).
• Limits: the same worker cannot be hired on probation twice by the same employer (otherwise probation is deemed waived); hiring different workers successively for the same permanent job is abusive and sanctionable (art. 92 bis(i) and (ii)).
• Rights during probation: full employment rights including union rights; social security contributions are due; work accident and illness coverage applies; paid sick leave for non work illness lasts only until the end of probation if the employer terminates; probation counts as service for all purposes (art. 92 bis(iii) to (vi)).
• Registration: the employer must register the worker from the start date, or probation is deemed waived (art. 92 bis, last paragraph).

3. Working time and rest

Collective agreements or company agreements may calculate the maximum on an average basis, provided the 12 hour daily and 35 hour weekly rests are respected and the weekly legal maximum is not exceeded (LCT art. 198).

4. Vacations

Source: LCT art. 150. Further rules:

• The worker must have worked at least half of the working days of the year; otherwise leave is 1 day per 20 days of effective work (arts. 151 and 153). No minimum seniority is required (art. 151).
• Leave starts on a Monday (or the next working day) (art. 151).
• Leave must be granted between 1 October and 30 April, unless the parties agree otherwise; start date notified in writing at least 30 days in advance; leave may be split by agreement into blocks of at least 7 days; each worker must get summer leave at least once every 3 years if leave is staggered (art. 154, as replaced by Law 27.802, art. 41).
• Illness during vacations: the worker returns at the end of the original period (or after the sick leave) and the unused days are rescheduled (art. 154).
• Vacation pay for monthly paid staff: monthly salary divided by 25 per day of leave (art. 155(a)).
• On termination for any reason, the worker receives pay for leave proportional to the fraction of the year worked (art. 156).

5. Salary components

• Remuneration is the consideration for the work and cannot be below the minimum living wage (LCT art. 103).
• Payment in money, in national or foreign currency (art. 105, as replaced by Law 27.802, art. 34), only by credit to a salary account in the worker's name, free of charge (art. 124). Monthly pay is due within 4 business days after the period (art. 128).
• SAC (aguinaldo): one twelfth of annual remuneration, paid in two instalments due 30 June and 18 December, each equal to 50% of the highest monthly pay of the semester (arts. 121 and 122). On termination, one twelfth of pay accrued in the fraction of the semester worked (art. 123).
• Social benefits (not remuneration, no contributions): meals, documented medical expense refunds and medical plans, work clothing and equipment, documented childcare refunds for children up to 6, school supplies, documented training, funeral expenses (art. 103 bis, as replaced by Law 27.802, art. 31).
• Non remunerative items: partners' and directors' withdrawals; profit sharing, share and dividend plans within limits set by the authority; documented car mileage refunds; documented travel expenses; public transport refunds; housing provided to workers without prior roots in the place; work related phone and internet within limits (art. 105(a) to (g)).
• Tips are never remuneration (art. 104, as replaced by Law 27.802, art. 32).
• Dynamic components: additional, transitory, fixed or variable merit or organizational pay may be introduced by collective, individual or unilateral employer decision and changed with the frequency the parties decide, without becoming vested by tacit continuity, ultraactivity or custom (art. 104 bis, incorporated by Law 27.802, art. 33).
• Deductions: at most 20% of the cash pay; union contributions under collective agreements subject to the 2% cap (art. 133, as replaced by Law 27.802, art. 37; Law 14.250, art. 9).
• Payslips may be signed digitally; content in art. 140; keep receipts for the 2 year labor and 10 year social security limitation periods (arts. 139, 140 and 143).

6. Sick leave and protected situations

• Paid sick leave for non work illness or accident: 3 months (seniority under 5 years) or 6 months (over 5 years), doubled to 6 and 12 months if the worker has family dependants (art. 208). Then the job is kept for 1 more year without pay (art. 211).
• Notice and certificates: the worker must notify during the first day of absence (art. 209); medical certificates must state diagnosis, treatment and days of rest and be digitally signed through platforms authorized under Law 27.553 (art. 210, as replaced by Law 27.802, art. 45).
• Dismissal during paid sick leave: in addition to severance, salaries until the end of the leave or medical discharge (art. 213).
• Maternity: 45 days before and 45 days after birth, total 90 days (art. 177, as replaced by Law 27.742, art. 93). Dismissal within 7.5 months before or after birth is presumed to be for maternity and costs an extra one year of remuneration on top of severance (arts. 178 and 182).
• Marriage: dismissal without proven cause within 3 months before or 6 months after a notified marriage is presumed to be for that reason (art. 181), with the same one year special indemnity (art. 182).
• Discrimination: a dismissal proven in court to be discriminatory adds 50% of art. 245 severance, which the judge may raise to 100%; the dismissal still ends the relationship (art. 245 bis, incorporated by Law 27.742, art. 95).
• Union representatives: candidates are protected for 6 months from notice of their candidacy (Law 23.551, art. 50, as replaced by Law 27.802, art. 143); elected delegates and representatives cannot be dismissed, suspended or have conditions changed without a prior court order (art. 52, as replaced by art. 144).

Termination of employment

7. Termination without cause

The employer owes, after probation (LCT arts. 231, 232, 233, 245, 156, 123):

1. Severance (art. 245): one month per year of service or fraction above 3 months.
2. Notice or pay in lieu (arts. 231 and 232): 1 month (up to 5 years of service) or 2 months (more than 5 years). Notice runs from the day after it is notified (art. 233) and must be proven in writing (art. 235).
3. Integration of the month of dismissal (art. 233): if there is no notice and the termination date is not the last day of the month, salaries for the remaining days of the month.
4. Final pay: days worked, proportional vacation (art. 156) and proportional SAC (art. 123).
5. Certificates (art. 80): within 45 business days of termination, covering the employment data, function, training received and social security payments. Making them available physically at the company or digitally, or through the social security or ARCA web systems, counts as compliance.

All termination payments are due within the art. 128 term (4 business days for monthly pay) counted from termination (art. 255 bis).

The severance base after Law 27.802

Art. 245 now spells out each element of the base:

Source: LCT art. 245, as replaced by Law 27.802, art. 51. Civil damages claims are incompatible with statutory labor benefits (art. 278, last paragraph, incorporated by Law 27.802, art. 57).

Seniority

Seniority is time effectively worked from the start of the relationship, including successive fixed term contracts. Prior service with the same employer counts on rehiring, unless 2 years elapsed between the end of the previous relationship and the rehiring (art. 18, as replaced by Law 27.802, art. 9). On rehiring, severance previously paid, updated by CPI, is deducted, but the result cannot be lower than severance for the last period alone (art. 255, as replaced by Law 27.802, art. 53).

8. Termination with cause

• Just cause exists when a breach is serious enough to prevent continuation of the relationship; judges assess it prudently (art. 242, as replaced by Law 27.742, art. 94).
• Strikes and blockades: active participation in blockades or occupations may be serious cause. Serious cause is presumed where, during direct action, the freedom to work of non strikers is affected, entry or exit is blocked, or damage is caused to persons or property. Before dismissal the employer must demand that the conduct stop, except in case of damage (art. 242).
• Form: the dismissal for cause must be communicated in writing with a sufficiently clear statement of the reasons, and the cause cannot be changed later in court (art. 243).
• Abandonment requires a prior formal demand to return to work (art. 244).
• Constructive dismissal: a worker who terminates for just cause gets notice pay, the month of dismissal integration and art. 245 severance (art. 246). If the employer imposes forbidden changes to essential conditions or causes material harm, the worker may, after a formal demand, consider himself or herself dismissed without cause (art. 66, as replaced by Law 27.802, art. 23).
• With a proven just cause, no severance or notice is owed, but final pay, proportional vacation and SAC remain due (arts. 156 and 123 apply "for any cause").

9. Other ways employment ends

10. Settlements, litigation and updating

• Settlements and releases are valid only with the intervention of a judicial or administrative authority and a reasoned decision that they achieve a fair composition; homologation gives them res judicata effect (LCT art. 15, as replaced by Law 27.802, art. 7).
• Labor claims are updated by CPI (INDEC) plus 3% per year from the date due until payment (art. 276, as replaced by Law 27.802, art. 54). For cases pending at entry into force, the BCRA passive rate applies, capped at CPI plus 3% and floored at 67% of that amount (Law 27.802, art. 55).
• Judgments may be paid in up to 6 monthly instalments (large companies) or 12 (MiPyMEs), adjusted under art. 276; contingency fee agreements are capped at 20%; first instance costs and fees at 25% of the judgment (art. 277, as replaced by Law 27.802, art. 56).
• Inexcusable overclaiming makes the party and the lawyer jointly liable for costs (art. 20, as replaced by Law 27.802, art. 10).
• Labor claims prescribe after 2 years (art. 256).
• In the City of Buenos Aires the national labor courts are being transferred to the City's courts under the agreement approved by Law 27.802, art. 90; Law 18.345 stays in force until the transfer is complete (art. 92). Labor judges must follow Supreme Court precedents (art. 89).

Registration and penalties for unregistered work

• Single registration. Employers register workers with ARCA under its rules; this registration is sufficient for all purposes and no other authority may require more (LCT art. 52, as replaced by Law 27.802, art. 20; Law 27.802, art. 155). The same applies to SMEs under Law 24.467 (arts. 84 and 85, as replaced) and home workers (Law 12.713, art. 6). Registration must be simple, immediate and electronic, with a simplified payslip system and a single payment for companies with up to 12 workers (Law 24.013, art. 7, as replaced by Law 27.742, art. 82).
• Books. Pre existing labor books must be kept for 10 years and may be digitized (art. 52).
• Effects of non registration. A presumption in favor of the worker's statements about the facts that should have been registered (art. 55); judges weigh formal omissions case by case (art. 53); loss of the probation period (art. 92 bis); referral by the judge to ARCA to collect contributions, fines and surcharges (art. 278; Law 24.013, art. 7 quater). The FAL never covers unregistered workers and covers deficiently registered workers only on the registered data (Law 27.802, arts. 58 and 64; Decree 408/2026, art. 13).
• Repealed fines. Arts. 8 to 17 of Law 24.013 and the whole of Law 25.323 were repealed by Law 27.742 (arts. 99 and 100). These provisions set the extra indemnities payable to the worker for unregistered or deficiently registered employment; this page does not restate them because they no longer apply to new claims.
• Worker reports. The worker must report irregular registration (lack of registration, real start date or real pay) to ARCA as soon as it is known (Law 24.013, art. 7 ter, as replaced by Law 27.802, art. 98).
• Administrative penalties remain under Law 25.212 (labor infractions), Law 11.683 and the social security laws; abusive use of probation is sanctionable (art. 92 bis(ii)). Penalty amounts are set in those laws and are not covered on this page.

Amnesty and incentives

RIFL hires must not have had registered employment at 10 December 2025, or must have been unemployed for 6 months, registered under the simplified regime (Monotributo), or last employed in the public sector (Law 27.802, art. 157; Decree 315/2026, art. 3). New employers from 10 December 2025 may use it for up to 80% of their payroll (art. 158; Decree 315/2026, art. 2). It is not available for workers rehired within 12 months, nor for employers listed in REPSAL or using it abusively (art. 160). The option must be exercised from the start of the relationship; it cannot be applied retroactively (art. 162; Decree 315/2026, art. 10). Employers who used the earlier Law 27.742 regularization regime cannot use the PER for the same workers (Law 27.802, art. 174).

The severance fund alternative: Labor Assistance Funds (FAL)

Two different instruments exist:

1. Substitution by collective agreement. A collective agreement may replace the art. 245 severance regime with a fund or termination system paid by the employer (LCT art. 245; Law 27.742, art. 96).
2. Mandatory FAL account. Title II of Law 27.802 creates the FAL, which every private employer must fund. It only helps pay severance and related amounts; it does not modify the severance regime (art. 58).

Until the FAL is in force, employers pay full employer contributions without the art. 76 reduction (Law 27.802, art. 167). The recitals of Decree 1228/2026 state that implementing rules were issued as Ministry of Economy Resolution 1276/26 (investment policies), CNV General Resolution 1167/26, ARCA General Resolution 5907/26 and UIF Resolution 109/26 ARCA General Resolution 5907/2026 sets the declaration and payment procedure; ARCA General Resolution 5915/2026 (Boletín Oficial, 26 October 2026) moved its start to the December 2026 accrual period. The other texts were not reviewed for this page.

Collective agreements: what changed

• Scope: homologated agreements bind all workers and employers in their scope, members or not; company or group agreements are filed for registration, publication and deposit and may be homologated on request (Law 14.250, art. 4, as replaced by Law 27.802, art. 130). Homologation or registration within 30 days, otherwise tacit homologation (Law 23.546, art. 6, as replaced by art. 150).
• Ultraactivity limited: after expiry only the normative clauses (individual conditions and benefits) survive until a new agreement; obligational clauses survive only by agreement (Law 14.250, art. 6, as replaced by art. 131).
• Hierarchy: a later agreement of equal scope modifies an earlier one in any direction; a smaller scope agreement (company) prevails over a larger scope one, earlier or later (art. 19, as replaced by art. 136). Larger scope agreements cannot dictate the content of smaller ones (art. 18).
• Caps on contributions: contributions to employer chambers capped at 0.5% of pay; union "solidarity" contributions binding non members capped at 2% (art. 9, as replaced by art. 133).
• Renegotiation: within 1 year of promulgation the Labor Secretariat calls the parties to renegotiate or ratify expired agreements; for agreements alive only by ultraactivity, the authority may suspend homologation effects if serious economic distortions are shown (Law 27.802, art. 137).
• Good faith bargaining: information duties, and court fines up to 20% of the monthly payroll of the workers in scope, raised by 10% every 5 days of delay and up to 100% for repeat offences (Law 23.546, art. 4).
• Workplace union activity: assemblies need employer authorization and are unpaid (Law 23.551, art. 20 bis); delegates get up to 10 paid hours per month unless the agreement grants more (art. 44(c)); blockades and occupations are very serious infractions (art. 20 ter) and unfair practices (art. 53 bis).
• Essential services in strikes: at least 75% of normal service in essential services and 50% in activities of "transcendental importance", with 5 days prior notice of direct action (Law 25.877, art. 24, as replaced by Law 27.802, arts. 101 and 102).

The severance cap in art. 245 depends on the agreement: the signatory parties calculate the average salary used for the cap (art. 245, fourth paragraph). Check the latest cap published for the agreement that applies to the worker.

Deadlines

Timeline of norms

Step by step

Hiring

1. Identify the collective agreement that covers the activity or establishment. It sets salary scales, categories, any probation extension and the severance cap (LCT arts. 92 bis and 245).
2. Choose the contract type. Use an indefinite contract unless a written, justified fixed term or seasonal or eventual need exists (arts. 90, 93, 96, 99). Put the start date, category, schedule, pay components and any overtime compensation or time bank scheme in writing (arts. 197 bis and 198).
3. Register the worker with ARCA before or on the start date (art. 52; art. 92 bis). If eligible, exercise the RIFL option at registration (Decree 315/2026, art. 10). Registration is done online through ARCA's "Simplificación Registral" service with Clave Fiscal, the same service RG 5907/2026 uses for FAL data; check ARCA's current instructions before the first hire.
4. Open or confirm the worker's salary account (art. 124) and arrange work risk insurance with an ART (work risk insurer). The general duty to insure comes from the Work Risks Law 24.557, which this page does not analyze; confirm coverage is active on the start date.
5. Open the FAL account with a CNV authorized entity before the first contribution, and report the "ID FAL" to ARCA (Decree 408/2026, arts. 8 and 9).
6. Monthly: pay within 4 business days (art. 128), issue payslips with the art. 140 content, file and pay social security contributions with the FAL contribution and the art. 76 offset (Decree 408/2026, arts. 10 and 24).

Dismissal without cause

1. Check protections before deciding: probation status, pregnancy or recent birth, marriage, sick leave, union candidacy or office (arts. 92 bis, 178, 181, 213; Law 23.551 arts. 50 and 52).
2. Decide whether to give notice (1 or 2 months) or pay in lieu. Notify in writing, by a means that can be proven (art. 235). The law requires written form, not a specific carrier; in practice employers use a carta documento or telegram so delivery can be proven.
3. Compute the final settlement: severance under art. 245 (base, cap, 67% floor), notice in lieu, integration, days worked, proportional vacation and SAC.
4. Decide whether to use the FAL balance (only after the 12 contribution waiting period and for workers registered at least 12 months). File the sworn electronic statement with the managing entity (Decree 408/2026, art. 17). The employer pays any difference.
5. Pay within 4 business days of termination into the worker's salary account (arts. 128, 255 bis).
6. Report the termination to ARCA through the same "Simplificación Registral" service (check ARCA's current instructions) and deliver certificates within 45 business days (art. 80).
7. If a settlement is negotiated, sign it before the labor authority or a court for homologation, or use a public deed for a mutual termination with the worker present (arts. 15 and 241).

Termination during probation

1. Confirm that the worker was registered from day one and has not been hired on probation before (art. 92 bis).
2. Confirm the applicable length (6 months, or 8 or 12 if the collective agreement extends it for your company size).
3. Communicate the termination in writing before the period ends. No cause, notice or severance is required (arts. 92 bis, 231).
4. Pay days worked, proportional vacation and SAC within 4 business days; deliver certificates.

Costs and timelines

Severance and related amounts

For executives, amounts paid on termination that exceed the minimum statutory severance are taxable as employment income, including amounts paid under mutual agreements or voluntary retirement plans (Income Tax Law, art. 82, last paragraphs).

Worked examples

Peso amounts are converted at ARS 1,563.90 per US$, close of Friday 23 October 2026 (dolarapi.com bolsa). Day rates use a 30 day month for salary days and the art. 155 divisor of 25 for vacation days; the 30 day divisor for salary days and integration is common practice, not a rule stated in the law. Amounts are gross, before employee contributions and taxes.

Example 1: dismissal without cause after seven years

Facts. A sales manager was hired on 1 March 2019 under an activity collective agreement. The employer dismisses the manager without cause and without notice on 14 October 2026 (last day worked). Monthly pay: base salary ARS 2,400,000 plus monthly commissions. Commissions were paid every month; the average of the last 6 months is ARS 300,000 and of the last 12 months ARS 260,000. An annual bonus of ARS 1,200,000 was paid in March. The parties to the collective agreement have published an average monthly salary for the cap of ARS 550,000 (hypothetical figure).

Step 1: seniority. 1 March 2019 to 14 October 2026 is 7 years, 7 months and 14 days. The fraction exceeds 3 months, so it counts as a full year: 8 years (art. 245).

Step 2: best monthly, normal and habitual remuneration. * Base salary: ARS 2,400,000. * Commissions are habitual (paid at least 6 months in the last calendar year). "Normal" is the average of the last 6 months (ARS 300,000) or the last year (ARS 260,000), whichever is more favorable: ARS 300,000. * The annual bonus is not paid monthly and is excluded, as is SAC. * Base before cap: 2,400,000 + 300,000 = ARS 2,700,000 (US$ 1,726).

Step 3: cap and floor. * Cap: 3 x ARS 550,000 = ARS 1,650,000 (US$ 1,055). * Floor: 67% x ARS 2,700,000 = ARS 1,809,000 (US$ 1,157). * The cap is lower than the floor, so the base is ARS 1,809,000.

Step 4: severance. 8 x ARS 1,809,000 = ARS 14,472,000 (US$ 9,254). Without the cap it would have been 8 x 2,700,000 = ARS 21,600,000 (US$ 13,812).

Step 5: notice in lieu. More than 5 years of service: 2 months (art. 231(b)). The art. 245 cap does not apply to notice pay (art. 232 refers to the remuneration the worker would have earned): 2 x 2,700,000 = ARS 5,400,000 (US$ 3,453).

Step 6: integration of the month of dismissal. 17 days remain in October (15 to 31): 17 x (2,700,000 / 30) = ARS 1,530,000 (US$ 978) (art. 233).

Step 7: final pay. * October days worked: 14 x 90,000 = ARS 1,260,000 (US$ 806). * Proportional vacation: entitlement 21 days (seniority at 31 December 2026 is between 5 and 10 years, art. 150). Days of 2026 worked: 287 of 365. 21 x 287 / 365 = 16.51 days x (2,700,000 / 25 = 108,000) = ARS 1,783,332 (US$ 1,140) (arts. 155 and 156). * Proportional SAC (art. 123): one twelfth of pay accrued 1 July to 14 October: (3 x 2,700,000 + 1,260,000) / 12 = ARS 780,000 (US$ 499). Whether SAC is also owed on the notice and integration amounts is disputed in practice and not settled by the text reviewed here; the example leaves it out, so budget for it as a possible extra.

Total gross: 14,472,000 + 5,400,000 + 1,530,000 + 1,260,000 + 1,783,332 + 780,000 = ARS 25,225,332 (US$ 16,130).

Tax note. The ARS 14,472,000 severance is exempt from income tax (Income Tax Law, art. 26(i)); notice in lieu is not exempt under the same article. If the manager is an executive, any agreed amount above statutory minimum severance is taxable (art. 82). Social security treatment of each item is not covered on this page.

FAL. If the FAL waiting period has elapsed and the manager has been registered for more than 12 months, the employer may pay all or part of these amounts from its FAL account (art. 58 lists arts. 232, 233 and 245). In October 2026 the FAL is not yet in force, so the full amount is paid by the employer.

Example 2: termination during probation, and the cost of waiting

Facts. An SME with 40 employees hires an analyst on 1 June 2026, registered with ARCA from that date. Monthly salary ARS 1,500,000. The applicable agreement does not extend probation, so it runs for 6 months, through 30 November 2026. The employer terminates on 20 October 2026.

What is not owed: severance (art. 92 bis), notice (art. 231(b)) and integration of the month (art. 233).

What is owed: * October days worked: 20 x (1,500,000 / 30) = ARS 1,000,000 (US$ 639). * Proportional vacation: the analyst did not work half of the year's working days, so leave accrues at 1 day per 20 days worked (art. 153). Weekdays worked 1 June to 20 October: 102 (holidays ignored); a real calculation should check the national holiday calendar for the period. 102 / 20 = 5.1 days x (1,500,000 / 25 = 60,000) = ARS 306,000 (US$ 196). * Proportional SAC (art. 123): (3 x 1,500,000 + 1,000,000) / 12 = ARS 458,333 (US$ 293).

Total gross: ARS 1,764,333 (US$ 1,128), payable within 4 business days, plus certificates within 45 business days.

Contrast: dismissal on 4 December 2026, after probation. Seniority 6 months and 3 days; the fraction exceeds 3 months, so 1 year. The employer would also owe: * Severance: 1 x 1,500,000 = ARS 1,500,000 (US$ 959), which is also the one month minimum (assuming the agreement cap is not lower; even then, the 67% floor and the one month minimum apply). * Notice in lieu: 1 month = ARS 1,500,000 (US$ 959). * Integration: 27 days (5 to 31 December) x 50,000 = ARS 1,350,000 (US$ 863).

Extra cost of missing the probation deadline by a few days: ARS 4,350,000 (US$ 2,782), almost three months of salary.

If the analyst had not been registered from 1 June, probation would be deemed waived (art. 92 bis), and the October termination would carry the same extra items as the December case.

Example 3: the FAL contribution for an SME

Facts. An SME (MiPyME under Law 24.467) has a monthly payroll subject to SIPA employer contributions of ARS 20,000,000. Of this, ARS 4,000,000 corresponds to three workers hired under the RIFL.

• FAL contribution: 2.5% x 20,000,000 = ARS 500,000 per month (US$ 320) (art. 60). The RIFL workers' pay is included: the FAL contribution remains mandatory for them (Decree 315/2026, art. 8).
• Offset (art. 76): 2.5% only on the ARS 16,000,000 of non RIFL payroll = ARS 400,000. No offset for RIFL workers while RIFL applies (Decree 408/2026, art. 24).
• Net extra cost: ARS 100,000 per month (US$ 64).
• Accumulated before the fund can be used (12 contributions, ignoring returns and fees): 12 x 500,000 = ARS 6,000,000 (US$ 3,837).
• A large company with the same payroll would contribute 1%: ARS 200,000 per month (US$ 128).

Under ARCA General Resolution 5907/2026 as amended by RG 5915/2026, the first FAL contribution is the one for the December 2026 accrual period. It is declared in the F.931 social security return and paid by VEP on the same due date as the other contributions, which falls in January 2027 under ARCA's yearly schedule (arts. 10 and 19). Before filing that return every employer must use the "Simplificación Registral" service to declare whether it is a private or public sector employer (art. 4). With 12 contributions required, the fund would first be usable for dismissals from roughly the end of 2027.

International comparison

Summary of the general rule for dismissal without cause or redundancy in each country, from official sources checked 26 Oct 2026. Notice periods, caps and special regimes differ; Estonia not yet sourced.

Practical traps

1. Late registration kills probation. Any day of unregistered work before the ARCA registration means the employer has waived probation (art. 92 bis).
2. Counting the probation end. Six months "of validity" from 1 June ends on 30 November. Decide early; a termination notified after the end date costs severance, notice and integration (Example 2).
3. Re hiring on probation. The same worker cannot be put on probation twice by the same employer (art. 92 bis(i)). Rehiring within 2 years also restores prior seniority (art. 18).
4. Probation extension needs a collective agreement. The 8 month and 1 year periods are not available by individual contract (art. 92 bis(a) and (b)).
5. Annual bonuses no longer inflate severance, but monthly bonuses, commissions and overtime do, averaged over 6 or 12 months (art. 245). Design pay accordingly, and remember the 104 bis "dynamic components" can be changed without becoming vested.
6. The cap is per agreement and changes. Use the cap calculated by the signatory parties at the date of dismissal, and always test the 67% floor.
7. Notice is not capped. The art. 245 cap applies only to severance; notice and integration use full pay (arts. 231 to 233).
8. Mutual terminations need form. A private resignation letter or a private mutual termination agreement is invalid: resignation needs a telegram or the labor authority (art. 240), and a mutual termination needs a public deed or an authority with the worker present (art. 241). Settlements need homologation (art. 15).
9. Executive packages. Amounts above statutory severance paid to directors and executives are taxable income (Income Tax Law, art. 82).
10. The FAL does not cap liability. The employer remains liable for the full amount and for deficient registration differences (arts. 64 and 68; Decree 408/2026, art. 13). Choosing a related fund manager is fined (arts. 62 and 75).
11. RIFL and FAL interaction. RIFL hires keep the FAL contribution but lose the offset (Decree 315/2026, art. 8).
12. Contractors. A principal that contracts its normal and specific activity must obtain from contractors each worker's CUIL, proof of monthly social security payments, proof of salary payment, the worker's bank account and work risk insurance with an endorsement in its favor; doing so exempts it from liability, omitting it makes it jointly liable (LCT art. 30, as replaced by Law 27.802, art. 18).
13. Acquisitions. The buyer of an establishment is jointly liable for labor debts it knew or could have known; hidden information not discoverable through due diligence exempts it (art. 228, as replaced by Law 27.802, art. 47). The FAL account transfers with the establishment (art. 73).
14. Group companies are jointly liable only when fraudulent maneuvers exist (art. 31, as replaced by Law 27.802, art. 19).
15. Paying in dollars is allowed (art. 105), but payment must still go to the salary account (art. 124) and severance remains computed under art. 245.

Recent changes

• 9 July 2024: new probation regime (6, 8 or 12 months) and registration requirement (LCT art. 92 bis, Law 27.742, art. 91, in force from the day after its BO publication of 8 July 2024).
• 8 July 2024 onward: repeal of the worker fines of Law 24.013 (arts. 8 to 17) and Law 25.323; new art. 245 bis on discriminatory dismissal; option for severance funds and private systems (Law 27.742, arts. 95, 96, 99, 100) The general entry into force rule of Law 27.742 applies; this page does not check provision by provision dates.
• 6 March 2026: Law 27.802 published. Immediate changes include the new art. 245 base, cap and floor; no notice in probation (art. 231); 45 business day certificate rule (art. 80); telegram resignation (art. 240); tacit mutual termination after 2 months (art. 241); CPI plus 3% updating (art. 276); payment of judgments in instalments (art. 277); vacation rules (art. 154); time banks (arts. 197 bis, 198); social benefits and payment in foreign currency (arts. 103 bis, 105); collective bargaining changes (Laws 14.250, 23.551, 23.546); essential services in strikes (Law 25.877).
• 1 May 2026: RIFL window opens for new hires (Decree 315/2026, art. 1).
• 1 June 2026: Decree 408/2026 regulates the FAL and postpones it to 1 November 2026.
• 20 October 2026: Decree 1228/2026 postpones the FAL to 1 December 2026 and extends the waiting period to 12 months.

Pending changes

• FAL operational rules: CNV, ARCA and Ministry of Economy rules cited in Decree 1228/2026 (Res. MECON 1276/26, RG CNV 1167/26, RG ARCA 5907/26, UIF Res. 109/26) were not reviewed for this page except RG 5907 and its amendment RG 5915; the joint resolutions on minimum coverage (Decree 408/2026, art. 4) and on suspension of contributions (art. 16) were not found by this page.
• FAL start: the law allowed postponement of up to 6 months from 1 June 2026; 1 December 2026 uses the full extension (art. 77, as recited in Decree 1228/2026). Any further delay would appear to need a new law.
• PER regulation: the 180 day window runs from the entry into force of its regulation; ARCA was to regulate within 15 days (Law 27.802, arts. 171 and 176). This page has not confirmed whether that regulation has been issued.
• Collective agreement caps: each agreement's signatory parties must calculate and register the art. 245 cap; check the cap published for your agreement.
• Renegotiation of expired agreements within one year from promulgation (art. 137).
• Authority limits still to be set: meal benefit limits (art. 103 bis(a)), phone and internet limits (art. 105(g)), profit sharing limits (art. 105(b)); this page has not confirmed whether they have been issued.
• Regulation of independent workers with collaborators (Law 27.742, art. 97) and the bank payment systems excluding the employment presumption (LCT art. 23): not confirmed as issued.
• Transfer of national labor courts to the City of Buenos Aires (Law 27.802, arts. 90 to 94).

FAQ

1. Is a written employment contract mandatory? Not for an indefinite contract, which is the default (LCT art. 90). A fixed term must be agreed expressly and in writing. Registration with ARCA from day one is mandatory in every case (arts. 52 and 92 bis).

2. How long is probation and can I extend it by contract? Six months. Only a collective agreement can extend it, to 8 months in companies with 6 to 100 workers and 1 year in companies with up to 5 workers (art. 92 bis).

3. Do I need to give notice to end probation? No. Law 27.802 removed the notice obligation for the employer during probation (art. 231(b)), and no integration of the month is owed (art. 233). Final pay, proportional vacation and SAC are still due. Whether the employee must give 15 days notice when resigning during probation is not clear from the text, which places the exemption under the employer paragraph. Treat it as an open point and give the notice if in doubt.

4. How is severance calculated? One month of the best monthly, normal and habitual pay of the last year for each year of service or fraction over 3 months, with the base capped at 3 times the collective agreement average but never below 67% of the real base, and a minimum of one month (art. 245). See Example 1.

5. Is the SAC or annual bonus included in the severance base? No. Non monthly items such as SAC, vacation pay and bonuses not paid monthly are excluded (art. 245, second paragraph).

6. Can a dismissed employee also sue for civil damages? Not for the dismissal itself. Statutory severance is the only remedy and extinguishes related civil claims, except claims based on criminal offences (arts. 245 and 278).

7. What happens if I had an employee off the books? The worker's statements are presumed true on unregistered facts (art. 55), probation is lost (art. 92 bis), and the court sends the case to ARCA to collect contributions, fines and surcharges (art. 278). The old worker fines of Laws 24.013 and 25.323 no longer exist (Law 27.742, arts. 99 and 100). The PER amnesty may reduce the debt by at least 70% (Law 27.802, art. 169).

8. Does the FAL replace severance? No. It is a fund owned by the employer that can help pay severance and related items; the severance regime is unchanged and the employer stays fully liable (arts. 58, 64 and 68). Only a collective agreement can substitute the severance regime with a termination fund (art. 245; Law 27.742, art. 96).

9. Does the FAL cost my company more? In principle no: the 1% or 2.5% contribution is offset by an equal reduction in employer contributions (art. 76), except for RIFL hires, where the contribution applies without the offset (Decree 315/2026, art. 8). See Example 3.

10. Can I pay salaries in US dollars? Yes, salary may be paid in national or foreign currency (art. 105), credited to the worker's salary account (art. 124).

11. How much vacation does an employee get? 14, 21, 28 or 35 calendar days depending on seniority at 31 December (art. 150), granted between 1 October and 30 April with 30 days written notice, splittable into blocks of at least 7 days (art. 154).

12. Can a company agreement override the activity agreement? Yes. A smaller scope agreement prevails within its scope over a larger scope one, earlier or later (Law 14.250, art. 19, as replaced by Law 27.802, art. 136).

13. How fast must the final settlement be paid? Within 4 business days of termination for monthly paid staff (arts. 128 and 255 bis). Certificates within 45 business days (art. 80).

14. Is severance taxed? Severance for seniority is exempt from income tax; notice in lieu is not exempt under art. 26(i); executive payments above the statutory minimum are taxable (Income Tax Law, arts. 26(i) and 82).

Primary sources

• Employment Contract Law 20.744, updated text (InfoLEG)
• Law 27.802, Labor Modernization Law, Boletín Oficial (6 Mar 2026)
• Law 27.742, Bases Law, Titles IV and V (argentina.gob.ar)
• Law 11.544, working hours (InfoLEG)
• Decree 315/2026, RIFL regulations, Boletín Oficial (4 May 2026)
• Decree 1228/2026, Labor Assistance Fund start date and waiting period (argentina.gob.ar)
• ARCA General Resolution 5915/2026, amending RG 5907/2026, Boletín Oficial 36,020 (26 Oct 2026), first section pp. 56 to 57
• Income Tax Law, consolidated text 2019, arts. 26(i) and 82 (argentina.gob.ar, updated text)

Related pages

• Labor: current framework
• Payroll taxes and contributions
• Tax overview