STATUTORY RULES ON EXPATRIATES ARE NOW CLEARER
Presidential Decree No. 79/17, of 24 April of 2017 (“PD 79/17”), amended Articles 2, 7 and 10 of the general rules on labor local content and the hiring of foreign non-resident employees, which had been recently approved through Presidential Decree No. 43/17, of 6 March 2017 (“PD 43/17”).
One of the most relevant changes relates to the duration of employment contracts entered into with expatriate employees. Accordingly, under the new terms set forth by Article 7 of PD 79/17, the duration of the employment contract can now be freely agreed between the employer and the employee, being subject to a maximum of two renewals. This provision needs to be harmonized with various immigration statutes that still refer 36 months as the maximum duration for this type of contracts.
The abovementioned provisions as approved by PD 43/17 raised a significant controversy, notably regarding the payment of the non-resident expatriate employees’ salaries. Nonetheless, PD 79/17 came to clarify said uncertainties which the companies faced during the first months of entry into force of PD 43/17. Accordingly, PD 79/17 clarified that the amount and the currency of payment of the expatriate employees’ salaries may be freely agreed upon between the parties under the General Labor Law’s principles. The payment of the salaries may take place in the currency agreed between the parties, which can be a foreign currency. Said solution seemed, until the entry into force of this Diploma, expressly prevented, being the national currency the only one accepted. It was further foreseen that in the case of salaries paid in cash, all payments must be mandatorily processed through a finance institution. (To continue reading complete article, please click here.)