The court notes that this sanction depends both on the employer’s circumstances and on the severity, consequences, and nature of the violation.
On July 21, 2026, the Second Labor Court of Santiago (Case No. T-452-2026) ruled on the key criteria to be considered in determining whether it is appropriate or inappropriate to impose a ban on an employer from contracting with the government—one of the most significant sanctions associated with violations of fundamental rights.
Given that Law No. 21,634, which took effect on December 12, 2024, amended Article 35 septies of Law No. 19,886, allowing the labor judge to adjust the penalty of disqualification from contracting with the government following a conviction for the violation of fundamental rights—or to simply not apply it —thus putting an end to the mandatory two-year disqualification period that had been in effect prior to the aforementioned reform.
Consequently, the Second Labor Court of Santiago, after convicting an employer of violating fundamental rights and causing emotional distress, had to rule on the plaintiff’s request regarding the application of the aforementioned disqualification for the maximum legal term.
The Second Labor Court of First Instance of Santiago, expressly citing what it considered to be key factors in determining the appropriateness of the sanction, chose not to impose the sanction in question, exercising the discretion granted by the new version of Article 35 septies of Law No. 19,886, given that, in the court’s view, the application of that sanction in that specific case could have serious social consequences.
In addition, the court noted that “the defendant is a primary health care facility that provides an essential public service to the community; therefore, the application of the aforementioned disqualification could affect the continuity and proper provision of health care received by its patients.”
Furthermore, the court added considerations that were no longer general in nature regarding the role of the employer, but rather specific to the case at hand and the response to the violation alleged by the plaintiff, noting that “it is considered that the proven violating conduct has ceased, given the organizational measures adopted by the employer and the fact that the person directly involved in the events no longer works at the facility.”
The court also noted that “this ruling imposes the compensatory and declaratory remedies provided for by law, which are sufficient to fulfill the reparative and deterrent purpose inherent in the action for tutela.”
Finally, the court’s ruling highlights that, in determining the appropriateness or inappropriateness of the aforementioned sanction, it considers not only the general conditions of the service provided by the employer or the industry to which a company belongs, but also attaches particular importance to the severity of the violation found, its current status at the time of the trial, the consequences of the violation, and any other remedial or punitive measures that may be adopted.
For more information on these issues, please contact our Labor Group:
Jorge Arredondo | Partner | jarredondo@az.cl
Jocelyn Aros | Labor Group Director | jaros@az.cl
Felipe Neira | Senior Associate | fneira@az.cl
Palmira Valdivia | Associate | pvaldivia@az.cl
Manuel Sepúlveda | Associate | msepulveda@az.cl
Catalina Díaz | Associate | cdiazp@az.cl
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