We invite you to read the column written by our partner Jorge Arredondo, in which he discusses the lessons and challenges that labor reforms have left for companies one year on.
Over the past year, four new regulations related to the world of work have emerged in Chile: the 40-hour law; the work-life balance law; the Karin law; and the law on criminal liability of legal persons, better known as the economic crimes law, particularly in relation to the three labor offenses covered by this regulation. In recent months, each of these has provided important lessons that companies should pay attention to.
In the case of the work-life balance law, as is well known, it establishes the right of workers to request to work remotely, with the employer having the option to accept or reject this measure. In the event of disagreement, the question at the time was who would decide which right took precedence, the Labor Inspectorate or the courts. In the cases that have arisen in recent months, we have seen disparate court rulings, some validating that it is the Labor Inspectorate that resolves this controversy, but also others that have established that the labor administrative body does not have the competence and powers to resolve, in the event of a dispute between worker and employer, this being a matter for a court ruling.
What has become clear to companies is that, if they choose to reject an application, it is essential not to give generic and ambiguous responses. The justification must be very detailed and compelling.
As for the 40-hour law, there is still uncertainty regarding Article 22, which regulates exclusions from the ordinary working day. This is because the new regulations reduced the number of workers who could be subject to this regime, namely managers and administrators, and those who work without immediate supervision due to the nature of their work. There is still debate regarding the scope of the concept of “immediate supervision” in a technologized world of work where there is increasing relocation of service provision. Given this, it is important to pay attention to how courts are applying this regulation and to seek ongoing advice.
The Karin Law broke with the paradigm of labor disputes, since before this regulation, data showed that most cases occurred when a worker left the company. Today, however, companies must deal with disputes between workers who continue to perform their duties. The regulation states that, in the event of a complaint, organizations can conduct an internal investigation—which must be completed within a maximum of 30 days—or submit it to the DT for investigation. The Labor Directorate also has a deadline of one month, but because an average of 5,000 cases are filed each month, the entity generally does not meet the deadlines, creating a very difficult situation for companies that have to deal with the conflict for months. Given this, a good measure is to outsource the investigation of potential complaints.
Finally, the economic crimes law establishes three crimes in the area of labor: labor exploitation, workplace accidents, and social security. Prevention and training models are key words for dealing with this new regulation.
This first year of labor reforms has left a clear lesson: companies must manage these regulations proactively, with clear processes, technical advice, and an internal culture aligned with the new legal reality.
Column written by:
Jorge Arredondo | Partner | jarredondo@az.cl
