Payroll and Benefits Guide Argentina
Last updated: Dec 20, 2022
Employer Payroll Contributions
|26.91% – 29.91% +100 ARS||Total Employment Cost|
|18.00% – 21.00%||Pension Fund (the minimum salary is 9,787.95 ARS and maximum is 318,103.83 ARS)|
|2.41%||Labor Risk Insurance|
|100 ARS||Occupational disease trust fund (FFEP)|
Employee Payroll Contributions
|17.00%||Total Employee Cost|
|11.00% (Ceiling 28,000.65 ARS)||Pension Fund|
|3.00% (Ceiling max 28,000.65 ARS)||Social Security|
|3.00% (Ceiling 28,000.65 ARS)||Health Insurance|
Employee Income Tax
|5.00%||Up to 64,532.64|
|9.00%||64,532.64 – 129,065.29|
|12.00%||129,065.29 – 193,597.93|
|15.00%||193,597.93 – 258,130.58|
|19.00%||258,130.58 – 387,195.86|
|23.00%||387,195.86 – 516,261.14|
|27.00%||516,261.14 – 774,391.71|
|31.00%||774,391.71 – 1,032,522.30|
|35.00%||1,032,522.30 and up|
The national minimum wage is 57,900 ARS and will incrementally increase to 69,500 pesos by March 2023.
MINIMUM WAGE (PER MONTH)
Payment is dependent on the type of contract in place and per Sections 126 and 128 of the Argentina Employment Contract Law. Payments are made as follows:
- Monthly employees are to be paid at the end of each calendar month.
- Employees with daily or hourly wages must be paid weekly or bi-weekly.
- Personnel who are paid per project must be paid weekly or bi-weekly.
Payments must be made within four working days for monthly or bi-weekly employees and three working days for weekly employees.
Argentinian local law states employees are entitled to receive an additional month’s salary, a 13th-month salary: Aguinaldo. This 13th-month salary is payable in two semi-annual installments, which are due for payment before June 30th and December 18th, respectively.
The amount of each installment is equal to 50.00% of the highest monthly wage received during the previous 6-month period.
In Argentina, The Employment Contract Law states that working hours shall not exceed 8 hours per day and 48 hours per week, excluding rest time. However, laws associated work considered unhealthy or with night shifts ( 9 pm – 6 am) limit employees to 7 hours of work.
Overtime hours must not exceed 3 hours per day, 30 hours per month, or 200 hours per year unless prior authorization from the relevant labor authority has been agreed.
Overtime worked on weekdays is paid at an additional 50% of the salary, whereas overtime worked on a Saturday afternoon, Sunday, or Public Holiday would be paid at double the salary.
The typical working week is from Monday to Friday
Paid Time Off
Employees who have worked for an employer for more than six months are entitled to 2 weeks of annual leave. The amount of holiday entitlement increases with the length of continuous employment, up to a maximum of 35 days.
New employees are entitled to 1 day of leave for every 20 days worked.
The entitled paid vacation for employees in Argentina is dependent on their time with the employer:
- employees who have worked for the same employer for less than five years are entitled to 14 days leave
- employees who have worked for the same employer for 5 – 10 years are entitled to 21 days leave
- employees who have worked for the same employer for 10 – 20 years are entitled to 28 days leave
- employees who have worked for the same employer for more than 20 years are entitled to 35 days leave
During annual leave, the employer must pay the employees’ full salary as well as any other entitled benefits. Annual leave is calculated by dividing the salary payment by 25 and multiplying it by the number of days’ holiday to which the employee is entitled.
There are 16 national holidays. Holidays that fall at the end of the week are moved to the following Monday.
If an employee has worked for a company for less than five years, they are entitled to a maximum of 3 months paid sick leave. Once they have worked for a company for more than five years, the paid sick leave is extended to 6 months.
The employer covers the payment of sick pay; however, the Employment Risk Insurance (which is a compulsory insurance for employers) covers any treatment, sick pay, or rehabilitation for a work-related accident, injury, or illness.
Maternity leave is 90 days, of which the mother must take at least 30 days before the birth of the child. Commonly, the leave is split 45 days on either side of the delivery.
The Argentine Social Security system pays Maternity leave.
PAID MATERNITY LEAVE (DAYS)
New fathers are entitled to 2 days of paid paternity leave.
There are no provisions for Parental leave in Argentina.
Employees also receive paid leave under the following circumstances:
- An employee is entitled to 10 days’ leave for their marriage
- An employee is entitled to 3 days’ leave for the death of a child, parent, or spouse and one days’ leave for the death of a sibling
- An employee is entitled to two days’ leave (at any one time, with a maximum of 10 days) for university or high school exams.
The employer must justify any termination with notice unless it is through mutual agreement, the employees’ failure to fulfill their work requirements, severe misconduct, or economic factors.
Employees who have worked for the same company for more than three months but less than five years must provide one month’s notice.
Employees that have worked for the same company for more than five years must provide two months’ notice.
Severance pay is calculated at one month’s salary for each year of employment. However, if an employee’s contract is terminated for economic reasons, they will receive half a month’s pay for each year of service.
An employee may also be entitled to receive remuneration for o the proportion of the year worked and with a proportionate part of the 13th salary, depending on the reason for termination.
In addition, decree No. 886/2021, issued on 23 December 2021, extended the public emergency in occupational matters and established the progressive reduction of the increase in severance payments. In the event of dismissal, in addition to the corresponding severance in accordance with the applicable legislation, the affected employee will be entitled to
- From 01/01/2022 to 28/02/2022 an increase of 75% of the usual severance
- From 01/03/2022 to 30/04/2022 an increase of 50% of the usual severance, as of 01/05/2022 to 30/06/2022 an increase of 25% of the usual severance. (these percentages will be calculated considering all severance items arising from the termination of the employment contract and may not exceed 500,000 pesos). This doubling of compensation does not apply to any employees hired after 13 December 2019.
The Probation period in Argentina is three months.
During the first three months of employment, should the employer or the employee decide to terminate the contract without cause, the employer has no obligation to pay severance but must notify the employee of the termination 15 days in advance.
There are three categories of residence for Argentina: transitory, temporary, and permanent residence.
- The transitory residence is generally for individuals living in Argentina for less than three months and does not allow work except for technical residents.
- Technical Residency is granted to foreigners who perform technical or professional activities. Individuals can obtain this residency at the Argentinean Consulate in their home country/territory or after arriving as a tourist.
- Business residency is issued to foreigners who have been invited by a company that is established in Argentina. The Individual can request this residency at the Argentinean Consulate of the foreigners’ home country/territory only. This type of residence is for business use; it is a 60-day residency, extended upon the Immigration Office’s discretion.
Temporary Residency is for foreigners who want to live in the country/territory for an extended period. They can work, study, live, etc. A Work Residence is the residence type applied to foreigners employed by a local company long term. The Work Residence is valid for one year, and this can be extended indefinitely.
Permanent Residence is for those foreigners who want to live in the country/territory permanently.
The rate of VAT in Argentina is 21%.
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Questions & Answers
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Payroll and Benefits Guide
What’s covered in this guide:
- Employer/employee contributions
- Minimum wage
- Working hours
- Visa requirements
Public Holidays Calendar
|Sunday||Jan-1||New Year’s Day|
|Tuesday||Feb-21||Death of San Martin|
|Tuesday||Feb-21||National Sovereignty Day|
|Tuesday||Feb-21||Death of San Martin|
|Sunday||Sep-10||Day of Respect for Cultural Diversity|
|Tuesday||Feb-21||National Sovereignty Day|
Is it mandatory for en employee to receive their COVID-19 Vaccination?
No, there is not a law currently that makes this a requirement.
A part-time employee need contribute income tax same as regualr employees?
The income tax depends on the amount of the salary and not on the time worked by the employee. Currently, a single employee with a salary of ARS 225.000 or less is not subject to income tax contribution.
How does mileage reimbursement in Argentina work for an employee? Is there are part which is tax-free and a part that will be taxed?
Mileage reimbursement is taxable only if it is a fixed amount of money and a receipt is not required. Otherwise, it is tax-free.
What is the prevailing mileage rate for use of personal vehicle in Argentina?
Reimbursement for mileage is taxable only if it is a fixed amount of money, and the employee does not have to submit an expense report and receipt, otherwise, it is not taxable.