Regulation of the Labor Payment Accounts

Javier CanosaPartner, Canosa Abogados

On May 5, 2010 the Official Gazette published law No. 26,590 (the “Law”), that modifies the Law on Labor Agreement and regulates the conditions of the bank account in which the wages of workers must be deposited.

By Javier Canosa

The Law on Labor Agreement establishes that the wage due to the worker must be paid, under penalty of invalidity as follow:

(a)        in cash;

(b)        check payable to the worker to be cashed personally by the worker or by whom the worker indicates;

(c)        by means of the accreditation in account opened to the name of the worker in a banking organization or institution of official saving.

In this context, the Law establishes that the account, in which the employer must deposit the wage to the worker, must be a special account denominated “Payment Account” (the “Payment Account”).

Additionally, the Law establishes that the Payment Account “under no concept will have limits of extractions, nor cost for the worker, as far as its constitution, maintenance or extraction of funds in all the banking system, in any extractive modality”.

Finally, it stills in force the provision of the Law on Labor Agreement that establishes that the worker always conserves the right to demand that the wage were paid in cash.

The Law entered in force the eighth day from publication in Official Gazette.