The following points must be considered when dealing with employees.
Salary: Government rules a minimum salary for workers, currently $8.060.
“Aguinaldo”: Annual complementary salary or “thirteenth salary” is to be paid in two halves in June and in December. It is equivalent to 50% of the best salary of each calendar semester.
Vacations: Must be pre-paid before they are taken. Every employee with at least 6 months in payroll has the right to take a minimum of 14 days.
Termination package: When firing an employee, the employer must pay compensation equivalent to one month’s salary for each year of work plus some benefits.
Both employers and employees have to contribute to the pension and retirement system, and to the health care system. Employees or the self-employed can also choose to contribute to the public or private system. In the first case, employees contribute 14% of their salary, and the 10% in the latter. Employees contributions are calculated within the maximum limit of ARS 73.000.
Employers’ contributions to Social Security depend on the activities carried out by the company. In the case of the rendering of services the contribution is 21%, while the usual rate is 17%. These payments of Social Security taxes contributed by employers include payments to the pension and retirement fund, to the family allowances system, and to the Federal fund for unemployment
Independent or self-employed workers (“trabajadores autónomos”) have to contribute to the retirement system with a fixed amount that is related to the estimated income they earn and depending on the type of activities carried out. Companies’ members of the Board of Directors are required to become affiliated to the retirement system for independent workers. Directors may choose to contribute also to the payroll or regular employees’ retirement system, provided that they also perform administrative or technical activities for the company.
Argentina has signed international agreements on social security matters with Brazil, Chile, Greece, Italy, Peru, Portugal, Spain and Uruguay. Given the reciprocal nature of provisions in those agreements, they allow for the mutual recognition of services rendered in one or the other of the signatory countries.
Argentina places no restrictions on the employment of foreign workers beyond compliance with standard immigration regulations. Expatriates may work in foreign-owned businesses as long as they hold a valid resident permit. Argentina maintains agreements with Uruguay,
Brazil, Chile, Italy, Paraguay, Greece, Portugal, and Spain: foreign professionals employed in Argentina are exempt from being subject to payroll taxes for a period of 2 years. Companies that have foreign scientists, professionals, or technicians under contract may apply for an exemption from most employer social security contributions, but only for contracts of less than two years’ duration. Such exemptions considerably reduce payroll costs.
The medical system is managed between national and provincial government, and private companies. Every employee is covered through social security payments. Companies usually pay an additional medical insurance to get better coverage for their employees.
On salaries, 3% and 6% (up to certain limits) must be paid by employees and employers. These rates are intended to cover the obligatory medical plan (PMO).