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Labor Newsletter – March 2020

COVID-19

CURRENT NEWS

Labor measures related to COVID-19.- The main measures established by the Government are the following:

(i) Obligatory social isolation: A national state of emergency is declared (initially from March 16 to 30, period that was extended until April 12), during which obligatory social isolation and restriction of circulation of persons and vehicles are ordered, subject to some exceptions (mainly the provision of and access to basic goods and services).

(ii) Remote work: Employers are empowered to unilaterally determine the performance of remote work by their workers, prioritizing those who are considered a risk group, during the health emergency (March 12 to June 9).

(iii) Paid leave of absence: If the implementation of remote work during the state of emergency (for regular workers) and health emergency (for risk groups) is not possible, the employer grants a paid leave of absence to their employees.

(iv) Working hours: The employer is authorized to unilaterally change shifts and working hours during the period of health emergency.

(v)Transit Pass: From April 1, 2020, employees who are engaged in essential activities and that must move around during the quarantine must apply for a “Personal Work Pass” in order to be able to move around.

(vi) Subsidy: Employers of the private sector will receive a subsidy equivalent to 35% of the gross monthly wages of employees who generate fifth category income, and who are registered in the sworn statement of the Tax Return Program PDT 601-Electronic Payroll (PLAME) and individually receive a remuneration of up to S/ 1,500.00. To that end, employers must report the Interbank Account Code (CCI) to SUNAT on a remote manner, up to April 7, 2020, through SUNAT Online Operations.

 (vii) Withholding of Private Pension Funds: The obligation to withhold and pay the mandatory contribution of 10% of the insurable remuneration and the commission on the flow that is discounted monthly to the employees who are affiliated to the Private Pension System (SPP) is suspended during the period for the payment of the remuneration corresponding to April 2020. However, employers must withhold, declare and pay the amount of the Collective Disability and Survival Insurance so that coverage is not affected. There is no similar benefit for employees affiliated to the National Pension System (SNP).

 (viii) Withdrawal of the Compensation for Time of Services: During the period of the health emergency, employees are authorized to freely dispose of the funds of the intangible amount for deposits of Compensation for Time of Services (CTS), up to the sum of S/ 2,400.00.

For further information on some of the legal impacts of COVID-19 herein summarized, go to the following  links:

The use of digital or electronic signatures is promoted for the renewal of fixed-term employment contracts.- Fixed-term contracts which expire during the period of obligatory social isolation may be renewed by using a digital or electronic signature. A scanned signature can be used exceptionally.

SUNAFIL suspends deadlines for administrative proceedings.- SUNAFIL has suspended for 30 business days (from March 23, 2020) the calculation of the deadlines for the inspection proceedings, sanctioning administrative proceedings, procedures for access to public information, differ payment of fines and foreclosure.

The judiciary suspends deadlines and hearings.- The Executive Council of the Judiciary has ordered the suspension of the work of the Judiciary, as well as all deadlines and proceedings nationwide, from March 16 to April 12, with the exception of emergency bodies designated by each judicial district to address all criminal, constitutional and family matters as a matter of urgency.

The Directive on the use of video surveillance cameras enters into force.- The abovementioned directive entered into force on March 16, the details of this Directive can be found at the following link.

CASE LAW

The validity of the outsourcing of services in Peru is ratified.- The Constitutional Court dismissed the complaint of unconstitutionality against articles 3, 7, 9 and the first supplementary provision of Law No. 29497, as well as Article 1 of Legislative Decree No. 1038, considering that these do not promote different treatment between the employees of the user company and the employees of the contractor, and that they do not create job insecurity and do not facilitate fraud and simulation. The Court concluded, inter alia, that:

  • The user company is allowed to decentralize its entire production process, including its main activity, provided that they meet the requirements of the legislation.
  • The running of the statute of limitations applicable to the liability of the user company in respect of labor debts is valid.
  • The contractor may subcontract services.
  • The exception to the plurality of clients is valid.

The constitutionality of the labor system for micro and small enterprises (MYPE) is ratified.- the Constitutional Court dismissed the complaint against the provisions of the Single Revised Text of the Act to Promote Productive Development and Business Growth, recognizing the permanent nature of the special labor system and the constitutionality of the sales volume as the sole criterion for determining the micro and small enterprises covered by it.

INSPECTIONS

New “Protocol on the Exercise of the Inspection Function in Response to the Health Emergency and National State of Emergency (EEN) to Prevent the Spread of Coronavirus”.- The main novelties are the following: