Chile: new law validates the digital format of three documents used in formalizing the end of an employment contract

Digital versions of the ‘finiquito laboral’ (employment termination), ‘carta renuncia’ (resignation), and ‘Término de la Relación Laboral por Mutuo Acuerdo’ (employment contract termination by mutual consent) forms will soon carry the same legal value as their paper versions. Law No.21.361, published in the Official Bulletin on 27 July, 2021, modifies articles 162 and 177 of Chile’s Labor Code, and confers full and complete validity to these three documents, which are used to record the end of the employment relationship, and can be generated from the Labor Department’s internet platform and which can then be signed electronically by both the worker and the employer. In terms of the ‘finiquito laboral’ form, an employee can sign this form, which the employer issues via the Labor Department’s platform, note that s/he disagrees with element(s) of the document and s/he reserves the right (‘reserva de derechos’) to initiate legal proceedings. The new legislation also introduces the employer’s obligation to notify if all outstanding termination of employment-related payments will be paid to the employee in electronic or physical form. Employees will have the right to refuse electronic payments and will be able to demand payment by cheque or in cash. The new law is due to come into force at the end of October 2021 (90 days after its publication in the Official Bulletin).