The president of the National Confederation of Private Business Institutions (Confiep), Óscar Caipo, pointed out that the issues raised in the preliminary draft of the Labor Code “raise costs, make hiring and dismissals more rigid”.
“According to several studies, including that of the World Bank, one of the main factors why there is so much informality is because we have one of the most rigid labor laws in the world.”, Caipo indicated on Canal N.
Likewise, the union representative maintained that for years regulations have been issued that only benefit a minority of companies.
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“The country legislates on tax and labor matters, thinking that all companies are large and formal, but the reality is very different because 77% are informal labor. In addition, 99.5% are micro and small companies (mypes), so legislation continues for a minority and with it those who are outside the system cannot enjoy labor protection and an employment contract.“, said.
In this sense, Caipo commented that the Minister of Labor, Betssy Chávez, has already confirmed that the preliminary draft of the Labor Code will be debated in the National Council for Labor and Employment Promotion (CNTPE), after the request made by the business associations.
“She has even promised to deliver a schedule on Friday. We will make sure that the so-called socialization in the National Labor Council is not only to expose the issues but also to be a dialogue to seek a consensus and thus this Labor Code can come out well, resolve informality and generate employment.“, accurate.
Caipo added that it is expected “that they do not make labor legislation more rigid” because it will generate more problems in the country.
What is Labor Code?
The Labor Code proposed by the Executive establishes some changes in labor regulations, such as the reduction of the types of temporary contracts or the extension of the periods of maternity and paternity leave.
In addition, this proposal incorporates gender, intercultural, human rights, intergenerational, disability and intersectional approaches, in accordance with the current situation.
The elimination of the maximum cap on compensation to be paid in the event that a dismissal is declared null and void is also proposed. Currently the limit is 12 rewards.
Another point contemplates the elimination of remote work so that it can be replaced by telework.
