The ELA is proud to welcome our newest member firm: LOGOS  in Iceland!
The ELA is proud to welcome our newest member firm: LOGOS  in Iceland!


The Employee Dismissal and Suspension Ban as well as the Presumption of COVID-19 as an Occupational Disease are Both Extended


Rodrigo Solá Torino - partner - Labor & Employment
Walter Mañko - associate - Labor & Employment

Submitted by Firm:
Marval, O'Farrell & Mairal
Firm Contacts:
Enrique M. Stile
Article Type:
Legal Update

On April 22, Presidential Decree No. 266/2021 (the “Decree”) was published in the Official Gazette, extending, until May 31, 2021, the prohibition against dismissing employees without just cause and/or ordering dismissals and suspensions on grounds of insufficient or decreased workloads or force majeure.

The prohibition had originally been ordered on March 31 under Presidential Decree No. 329 and was later extended under Decrees No. 487/20, No. 624/20, No. 761/20, No. 891/20, and No. 39/21. 

The Decree reiterates that employment relations initiated after December 13, 2019 are not covered by the prohibition and contains a new exception for construction industry personnel (Law No. 22,250).  Suspensions agreed to under the terms of section 223 bis of the Labor Contract Law (between the employer and the employee or between the employer and relevant union), are exempted from the prohibition set forth in the Decree.

Dismissals and suspensions that conflict with the provisions of the Decree are null and void; thus, they have no legal effect and any existing employment relations and their current conditions remain in force.

Likewise, the Decree extends, until May 31, 2021, the presumption that COVID-19 infection is an unlisted occupational disease with respect to dependent employees who have rendered their service at their usual place of work, outside their place of residence.