Unemployment and Retirement Fund (FOCER)

The Unemployment and Retirement Fund (FOCER) is a Non-State Public Entity created by Law No. 18,236. Its primary mission is the administration and management of its assets, which are comprised of monthly contributions from employers and workers in the construction industry.

Specifically, the organization grants a set of benefits for contributing workers or—failing that—their beneficiaries, namely:

• Unemployment Benefit: Workers who have ceased employment, have the equivalent of at least 30 daily wages credited to their individual account, and have not made a withdrawal in the last 12 months are entitled to this benefit.

• Retirement Benefit: In the event of definitive retirement from the construction industry (for any reason), the worker may withdraw the total amount of funds deposited in their account.

• Death Benefit: In this eventuality, and without the need for judicial probate proceedings, the credited funds will be paid to the surviving spouse or common-law partner (or, in their absence, to the heirs), provided they have been designated before the Fund's Administrative Commission.

In all cases, the Social Security Institute (BPS) is the collecting agency for these contributions, with the employer acting as the withholding agent for the contributions corresponding to the workers.

Law No. 20,448, dated December 16, 2025, introduced a series of amendments to this regime, which are described below.

Expansion of the Scope of Application

Law No. 18,236 established that the beneficiaries of said fund would only be construction industry workers included in Group 9 – Subgroup 01 of the Wage Councils.

The new regulation expanded the scope of workers involved in the fund, also providing for the inclusion of temporary personnel hired by precast and ready-mix concrete companies under Subgroups 2 and 3 (complementary activities) of the aforementioned Activity Group, which include the following activities:

1. General quarries, lime pits, and ballast pits;

2. Ready-mix and precast concrete;

3. Red, white, and refractory ceramics, stoneware, and bricks – artisanal ceramics and gypsum products; and

4. Operation of toll booths located on highways.

As a result of this expansion, companies classified within this category (along with their workers) will be obliged to make the corresponding contributions. In all cases, there will be an increase in social security costs, a situation that will also impact current construction contracts and those entered into after the aforementioned reform.

Contribution Regime

Under the previous regime, workers excluded from the unified contribution regime who were entitled to severance pay (i.e., those with an indefinite employment relationship) were subject to an employer contribution of 0.5%, provided they did not work 51% or more of their monthly hours on-site.

The new Law eliminates this 51% requirement. To determine the contribution regime, the following aspects must now be analyzed: (i) the form of hiring and (ii) non-inclusion within the scope of Decree-Law No. 14,411.

The new contribution system is established as follows:

• Employer Contribution: * 0.5% for employees included or excluded from the Decree-Law 14,411 regime who are entitled to severance pay.

  • 0.5% for employees without fixed-term contracts who are excluded from the unified construction contribution regime (this is the modified scenario where the 51% requirement was removed).

  • 5% in all other scenarios.

• Personal (Worker) Contribution: * 0.5% in all cases. This contribution becomes mandatory in the following scenarios: * Daily wage workers: From the moment they are entitled to severance pay equivalent to 50 daily wages. * Monthly workers: Once they are entitled to 2 months' worth of severance pay and have 24 months of continuous seniority.

Use of Individual Funds for Administrative Expenses

Prior to this reform, the Law expressly prohibited using funds credited to individual accounts for FOCER’s administration and management expenses. Under the current regime, this prohibition has been eliminated, making such actions possible.

Regulation

In all cases, the regulation of the Law will be carried out with the prior consultation and advice of Group No. 9 (Construction Industry and Complementary Activities) of the Wage Councils, a tripartite body composed of the Executive Power, employer representatives, and worker representatives.