“Arcos Dorados Argentina S.A.” (hereinafter “the Company”) noted that there were differences between orders shipped and those charged, so they dismissed the responsible the employee with cause, stating a loss of confidence.

When notifying the dismissal, the Company generically indicated that “differences were found” without specifying those differences.

The employee challenged the cause of the dismissal in Court alleging that the Company did not express clearly the reasons for terminating the labor relationship (as required in section 243 of the Contract of Employment Law “ECL”) and that, consequently, the dismissal violated her right of defense.

On December 23, 2015 the National Labour Court of Appeals upheld the claim1 and ordered the Company to pay compensation for unfair dismissal plus fines for non-payment of compensation in due time.

Moreover, since the employee was within the pregnancy protection period when the dismissal occurred, and the Company was unable to prove that the dismissal obeyed to a justified cause, the Company was ordered to pay an additional special compensation equal to 13 salaries.2

Additionally, the Company had to pay a fine equal to 3 salaries due to the lack of delivery of the labor certificates set forth in section 80 of the ECL, since the Court of Appeals considered that it was not a defense that the Company indicated that the labor certificates were made available and that the employee failed to withdraw them.

This recent judgment provides a timely reminder that it is crucial to comply with legal requirements to communicate sanctions or dismissals to avoid having the measure considered arbitrary and/or to avoid the unnecessary payment of severance compensation and fines.

1 “Aguirre, Jennifer Beatriz vs. Arcos Dorados Argentina S.A.”
2 Section 178 of the ECL provides that, unless it is proved otherwise, the dismissal of women within the period of seven months and a half before and after the date of birth obey to pregnancy or maternity and it entitles the payment of an additional special compensation equal to 13 salaries.