Employment promotion for people released from the prision system
A Bill was approved that encourages hiring through a subsidy to the employer
Context
To date, there are a series of regulations that promote paid employment for certain groups that have greater difficulty accessing it.
In this framework we find, among others, Law No. 19,973 (regulated by Decree No. 308/022), which promotes the paid employment of young people between 15 and 29 years old, those over 45 years old and people with disabilities. The rule favors the labor insertion of workers belonging to these groups, through specific benefits for those who hire them.
Until now, there was no similar general regulation in the private sphere regarding people who have been released from the prison system.
New regulation
The approved text partially modifies Law No. 19,973 and consists of two articles.
The first proposes a new title for Chapter Seven of the Law: “Employment Promotion for people with disabilities and released people.”
The second incorporates two new provisions to the referred Seventh Chapter:
It is established that the employer who hires a released person who has been deprived of liberty in a unit of the National Rehabilitation Institute will obtain a partial subsidy on the beneficiary’s salary, of up to 80% of the worker’s monthly remuneration taxed by special social security contributions. Likewise, it provides that said 80% exemption may not exceed 2 national minimum wages (equivalent today to $37,766).
The contracting period must depend on the tasks of the respective program and may not be less than 6 months nor exceed 12 months.
These modifications to the Employment Promotion Law that were approved must be applied taking into account the rest of the provisions of the regulation that remain in force.
As an example, the rule establishes (art. 9) that companies that wish to participate in the employment promotion modalities that it regulates must prove that they are in a regular payment situation before the Social Security Bank (BPS), the General Tax Directorate (DGI) and the Ministry of Labor and Social Security (MTSS).
Likewise, it is stipulated that companies must not have unilaterally terminated any employment contract, nor have sent any worker to unemployment insurance during the 90 days prior to the hiring in question, nor during the period that it lasts, with respect to workers of the same category (except dismissals due to notorious misconduct, end of the harvest or the agreed contractual term if applicable).
Participation in this type of modalities is not permitted for companies registered with the BPS as a “service user”, nor for personnel suppliers, except for those that are not affected by the temporary provision of services to third parties.
The above is without prejudice to founded exceptions that are authorized by the MTSS.
Likewise, the rule establishes that workers who are related to the owner or owners of the companies, within the fourth degree of consanguinity or second degree of affinity, may not be hired in the modalities it regulates (art. 10)
The Law also provides that companies may not establish a rotating schedule regime for workers hired under any of the modalities it regulates, who are pursuing certain studies (arts. 42 and 43).
Finally, it provides that the subsidies will be made effective through a credit to cancel the company’s current obligations to the BPS.
Possibility of agreeing on a trial period
One of the two articles that is approved establishes a minimum period of duration of the contract for the employment relationship that is promoted (6 months), without establishing in express text the possibility of agreeing on a trial period.
This does not prevent the parties from agreeing on a trial period of variable duration as already established by Law. In fact, from its article 12 it appears that, depending on the contract period, a trial period of 45 days can be agreed for contracts of between 6 and 8 months in duration, 60 days for contracts of 9 to 11 months in duration and 90 days for contracts of 12 or more months in duration.
During the trial period, the employer may terminate the worker’s employment without giving reasons and without compensation for dismissal.
The rule establishes that, if the worker is dismissed after the trial period has elapsed, but before the agreed contractual period has expired, he must pay (except in cases of notorious misconduct) a severance payment priced as if it were an employment contract for an indefinite period.