dDNews Empresas | On-site Day Care Facilities. Stipend
The deadline set by Executive Order No. 144/2022 is March 23. By then Companies with more than 100 workers are required to offer on-site daycare facilities for children aged 45 days to 3 years, or alternatively pay a stipend. The benefit is intended for both parents but granted to one of them only.
EO 144/22 was passed at the initiative of the Department of Labor, run by Claudio Moroni, in March 2022, as a result of the Supreme Court ruling ordering to regulate Section 179 of the Employment Contract Act about daycare services for working mothers with children aged 5 or under. This Section could not be enforced because it had not been regulated for 47 years. On October 21, 2021, the SUPREME COURT OF JUSTICE OF ARGENTINA issued its decision in the matter of «Etcheverry, Juan Bautista et al v National State on amparo action Act No. 16986″, based on international human rights treaties signed by Argentina, which have constitutional standing. The case was filed by law students from various classes of Legal Practice at Universidad Austral, with the support of their teachers.
As a result of the aforementioned Supreme Court ruling, the following guidelines have been established:
- First of all, companies now have to bear the cost of offering on-site daycare facilities. Companies with more than a hundred (100) employees, regardless of their hiring method, must offer on-site daycare services for children aged between forty-five (45) days and THREE (3) years during working hours. The law does not specify it but it is believed that this obligation applies to all shifts. And so it is possible that the company has employees with children that are no longer in daycare. In this case, it would be nonsensical to require the company to offer on-site daycare services when its workers have children who have outgrown daycare.
- Companies must also bear the cost of trained staff to look after kids at daycare, and provide all the necessary elements (drinking water supply, heating, disposable diapers, hygiene kits, baby bottles, and the like).
- Additional expenses include the cost of the respective licenses and safety and hygiene conditions in compliance with the specific applicable law in each jurisdiction. Alternatively, companies may hire daycare services near-site (within a radius of 2 km).
- Those who do not offer their own daycare facilities or hire daycare services near-site, should negotiate a collective bargaining agreement and agree on the payment of a non-salary amount as reimbursement for childcare or caregiving services provided these expenses are duly documented. Employees should have the respective invoice and receipt for childcare services or give proof that they have hired a caregiver under a registered employment relationship in compliance with the Household Employees Act No. 26844.
- There is a minimum amount for this payment. The reimbursement for childcare or caregiving services shall not be less than an amount equal to forty percent (40%) of the monthly salary for live-out caregivers under Act No. 26844, or the actual expenses paid if lesser. As of February 2023, this 40% rate amounts to around ARS 30,000.
- In the case of part-time employees or employees working reduced hours, they shall be paid in proportion to their working hours.
- In the case of Telework (Act No. 27555, and Section 102 bis LCT) childcare services may be provided by a third party and in this case, the payment will be proportional to the caregiving time depending on the characteristics of each job.
- The one-year term established under EO 144/2022 expires irrevocably on March 23, 2023.
- Failure to comply with this obligation will be considered a very serious breach within the scope of the National Jurisdiction. (Act No. 25212 Annex II).
- Failure to offer on-site daycare facilities may be replaced by the payment of a stipend directly by the employer, in accordance with Section 102a (f) LCT.
- In any case employees must prove not only that they have a child of daycare age but also that they incur expenses for childcare or caregiving services in order to receive the stipend. This benefit is offered within the framework of gender diversity, and for adopting parents as well.
- This stipend will be paid to only one parent of a child of daycare age. It can be paid to working fathers if the mother is not eligible for the benefit, which will have to be analyzed on a case-by-case basis.
The scenario presents some issues subject to interpretation: what happens if the company or the industrial sector has not signed an agreement whereby they can choose to pay a stipend instead of offering on-site daycare facilities? In my opinion this apparent gap in the law is solved by Section 103 bis subsection f) LCT establishing reimbursement for duly documented childcare expenses when the company cannot offer on-site daycare facilities.
The text emphasizes that the company may reimburse employees directly and without the requirement to reach a Collective Bargaining Agreement under Section 3 of EO 144/2022. In general, companies have opted to reimburse employees for duly documented daycare expenses, and ruled out the possibility of building on-site daycare facilities due to the high costs of construction and investment, in addition to the possible risks and any collateral costs that this service may cause.