Argentina: Government extends access to wage subsidy to all companies

Argentina’s government has decided to pay up to 50% of workers’ net salary for companies with reduced or halted business activity due to the Covid-19 lockdown that has been in place since 20 March and that will extend at the earliest to 26 April, as well as to companies experiencing sharply lower sales volumes since 12 March and who have applied for the Work and Production Assistance (ATP) program that was specifically formulated to deal with the pandemic. This cover had previously been available for companies with a minimum of 100 staff (c.f. article No.11793). The decree sets a minimum monthly salary of ARS 16,875 (€235 euros) that is capped at twice that amount. The reference income corresponds to that of February 2020. This ‘supplementary salary is covered by ANSES (social security authorities), which will reimburse employers for these amounts, on the proviso that they continue paying full salary. The new decree also raises monthly unemployment benefits from ARS 6,000 (€83) to ARS 10,000 (€140). The government estimates that the cost of its series of economic cushioning measures taken to offset the detrimental effects of Covid-19 on the economy and employment accounts for almost 3% of GDP. According to the Minister of Labour, these measures will have prevented pandemic related employment destruction. The Minister also acknowledges that the real employment situation in the informal economy rests outside the scope of the measures.