Often regarded as a high-income economy endowed with a large population of highly educated and skilled workers, Argentina can be a rewarding location for businesses that want to expand into the region,
The country has a literacy rate of 99.51% as of 2021, the best in South America, a diversified industrial base and a very strong agricultural sector.
Argentina boasts a wealth of natural resources, contributing significantly to its impressive Gross Domestic Product (GDP) of 487.2 billion, ranking 27th globally.
Despite facing economic challenges from high debt and fiscal deficits, the country boasts a remarkable Human Development Index (HDI) of 0.842, putting it in a strong 47th place worldwide and second in all of Latin America.
Argentine Pesos (ARS)
Standard VAT of 21% / 27% for telecoms, water, electricity, and gas / 10.5% for medical, construction, most foods and electronic goods produced in Special Economic Zone
Payroll and taxes in Argentina
Employer contributions in Argentina
The contributions that employers are obliged to make are the following:
18% or 21% to Pension Fund (depending on size of company and how many employees)
6% for health insurance
2.41% Labor Risk Insurance
0.5% for each employee with Life Insurance
100 ARS for Occupational Disease Fund (FFEP)
In total, it ranges from 26.5% to 30% of the employment cost for each employee.
There are a few employee contributions that workers are obliged to pay in Argentina. This includes:
Pension Fund - 11%
Social Security Contribution - 3%
Health Insurance - 3%
All of these three contributions hold up a ceiling of a max 28,000.65 ARS each. In total, it’s equal to 17% of the employee's salary.
Personal income tax
When it comes to personal income tax, Argentinian law is very straightforward with set percentage rates according to the monthly gross salary.
Check the table below for the full rate list:
Minimum Wage in Argentina
The minimum wage rate is set to be increased to 69,500 ARS (376 USD) per month by March 2023. The current minimum wage in Argentina is set at 57,900 ARS per month, which corresponds to a 333 USD monthly salary. That equals a annual salary of roughly 4,000 USD.
Working Hours in Argentina
Working hours in Argentina are the regular eight hours per day, usually from Monday to Friday from 9am to 6pm, with an obligatory hour for lunch. Also, the Employment Contract Law states that working hours shall not exceed eight hours a day or 48 hours a week (no rest time included). If it does, it’s classified as overtime.
Overtime in Argentina
Overtime hours in Argentina are limited to three hours per day, 30 hours per month or 200 hours per year. Exceptions to this demand authorisation from the Ministry of Labor. If these overtime hours are performed during the regular week, workers should be compensated with there’s an additional 50% of their salary. If these hours are done on Sundays, Public Holidays or after 1 PM on Saturdays, the amount per hour is doubled.
Probationary period in Argentina
Probation period in Argentina takes up to three months. If during this time the employer decides to terminate the contract without cause, there's no obligatory pay of severance. The only requirement is to notify the employee at least 15 days in advance. After that time, the worker is considered a a permanent employee.
Employee Benefits in Argentina
An extra salary is paid in two installments over the year for each employee. The first installment must be paid before the 30th of June and second one before 18th of December.
Types of leave available in Argentina
See below the list and explanation of every kind of leave available for employees in Argentina.
According to Argentine labor laws, the amount of days for annual leave depends on how long the employee has been working in the company.
The maximum time for this leave is 35 days, and every worker is entitled to two weeks of annual leave after completing the first six months with the organisation. Newly hired employees gain one day of leave for every 20 days worked.
Refer below to see how the number of days increases according to the length of continuous employment:
More than six months, less than five years: 14 days of leave
Five to ten years of service: 21 days of leave
Ten to twenty years of service: 28 days of leave
More than twenty years of service: 35 days of leave
It’s good to remember that annual leave is paid in full by the employer, including bonuses and other benefits and perks.
All employees are entitled to sick leave, but the amount of time also depends on how long the worker has been with the company. For the ones that are employed for less than five years, they can have a maximum of 3 months of leave. If they have been employed by the same organisation for over five years, their sick leave entitlement is increased to six months.
The payment is made in full during this time, covered by the employer. However, the compulsory Labor Risk Insurance that companies have to pay covers treatments, sick pay and even rehabilitation for work-related injuries or diseases.
Maternity leave is defined as a 90-day leave. The only difference is that 30 of the 90 days have to be taken immediately prior to the baby’s birth. This leave is fully paid by the Social Security system.
New fathers have two days to take after the birth of each child. These days are also paid in full by Social Security.
Bereavement, marriage and school exams leave
There are also leaves in case of marriage (10 days in total), death of family members (three days in total) and in case of studying for exams in university or high school (three days at a time, total maximum of 10 days).
Public Holidays in Argentina
In total, there are 16 public holidays in Argentina, although they may vary sometimes by region.
New Year's Day - 1 January
Carnival (2 days) - 47 days before Easter
Truth and Justice Day - 24 March
Malvinas Day - 2 April
Good Friday * - Last Friday before Easter
Labour Day - 1 May
Revolution Day - 25 May
Martín Miguel de Guemes Day - 17 June
Flag Day - 20 June
Independence Day - 9 July
Death of San Martin - 21 August
Day of Respect for Cultural Diversity - 12 October
National Sovereignty Day - 20 November
Immaculate Conception - 8 December
Christmas Day - 25 December
Attracting talent in Argentina
The competition for top talent is a global phenomenon, with varying outcomes across regions. In Argentina, organisations have found success in attracting and retaining the best candidates through a simple yet effective approach - offering attractive financial packages. Recognising the significant impact that compensation can have on employee satisfaction and loyalty, these companies invest in both short and long-term benefits to retain their valuable workforce.
Provide employees with annual performance bonus
Offering performance bonuses is a standard practice among companies seeking to keep their workforce motivated.
Establishing clear and attainable criteria for bonuses is critical for maintaining employee engagement and satisfaction.
Bonus schemes that lack clear guidelines, are not performance-based, appear arbitrary, or are distributed unfairly among employees in similar positions can lead to resentment and a desire to seek employment elsewhere.
Personalised and well-communicated recognition and rewards serve to acknowledge and appreciate employees, ultimately contributing to their retention and satisfaction in the workplace.
Private pension plan
Private pension plans are also a valuable incentive that organisations can incorporate into their benefits package in order to make it more competitive and appealing.
Financial stability is a key factor in promoting the well-being and productivity of a workforce. According to a multi-country survey by Accenture, 62% of employees seriously consider the availability of a good retirement plan when deciding to change jobs or stay in their current position. Additionally, 76% are “very likely” to be attracted to a company that openly cares about their personal finances.
Therefore, offering competitive retirement or pension plans can greatly aid in retaining a motivated and satisfied workforce
Workplace flexibility has defined an entirely new way of working, providing employees with greater autonomy over how and when they work.
It has enabled to take greater control of their own schedule and create a much-needed balance between their work and personal lives.
This concept works best in high-trust workplace environments, where managers value their employees' professionalism and time management. And it has been shown to produce positive results.
The legal requirements for termination of contract states that it must be acknowledged by the employer in any case. The exception to this is when termination happens through mutual agreement.
Misconduct from the employee, economic factors in the company or failure to fulfil work-related tasks are all examples of motives for termination.
Notice periods are also affected by the amount of time the worker has been with the company. For employees employed for more than three months but less than five years, the notice period should be one month. For those employed for five years or more, it’s obligatory to have a two-month notice period.
When an employee is dismissed, severance pay is calculated according to time served at the company. For each year at the company, they get a month's worth of salary, except when terminated for economic reasons, then it’s half a month’s pay for every year in the organisation.
Other bonuses such as 13th salary are also paid in proportion to the year worked. For example, if an employee is dismissed in October, they are entitled to 10/12 of the extra remuneration.
What are my options for hiring in Argentina?
If you're interested in expanding your business into Argentina, contacting Airswift is the way to go!
We can assist foreign companies with meeting local government requirements in regards to hiring, obtaining legal counsel, labor laws, taxation compliance, work environment, permits and more.
Our clients benefit from our expertise in managing their risks and use the extra time and resources to focus on the needs, opportunities, and international expansion of their businesses.
If you need short-term contract hires and flexible working options, we can provide assistance with that as well. We guarantee your organisation access to the best talent by having a comprehensive database of qualified contractors.
If your organisation needs permanent staffing, our experienced recruitment specialists can assist with your needs. We're devoted to sourcing employees in Argentina that are the perfect fit for your corporate culture.
Employer of record
We can assist your business in recruiting Argentinian employees without setting up a local office!
By partnering with a third-party EOR, you can bypass the need for a physical office and put the focus back on running your business. We are responsible for tasks such as salary payment, payroll management and employee benefits. We manage all administrative duties like onboarding, payroll, tax management and more.
*Although the information provided has been produced from sources believed to be reliable, no warranty, express or implied, is made regarding the accuracy, adequacy, completeness, legality or reliability of any information. For the latest information and specific queries regarding particular cases, please contact our team.
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