Ignacio Funes de Rioja, Funes de Rioja & Asociados
In an exclusive interview with Who’s Who Legal, Ignacio Funes de Rioja at Funes de Rioja & Asociados discusses recent regulatory developments in the Argentinian labour market, the effects of changing contractual arrangements and the future of artificial intelligence in the field.
Argentina, in particular, has has an over-regulated economy and labour market during recent decades.
Employment regulations cover every aspect of the employment relationship; our national industry/activity collective bargaining agreement comes on top of those regulations, establishing a very rigid environment for those in the formal market. Even though, during the 1990s, some partial reforms were passed, in the past 12 years almost every initiative suffered a counter-reform. This has been an obstacle for the formalisation of the economy and for employment growth, and has also generated a high level of judicial disputes.
However, the new government is clearly aware of this, and has decided on impulse reforms. We are at the beginning of the debate on what kind of reforms are needed, and to what extent those reforms will be agreed to by employers and workers’ representatives.
In some sectors, the workers – especially the younger ones – tend to press for more flexible arrangements, and employers face the limitations of rigid regulations. However, this is not a general trend and in any case, it depends on the nature of the activity and the skills of the worker. The judicial decisions in the past few years have had an adverse affect on companies in the case of freelance workers being hired. Therefore, companies should always be cautious about the use of these contracts which, even when there is an express agreement with the worker, can be considered abusive and a violation of labour, employment and social security laws. This can trigger very expensive sanctions against the company – many of them to the benefit of the worker.
Moving employees around the globe is still a challenge for employers; the obstacles and risks are probably due to a lack of regulatory activity around the practice. However, the cultural factors, and the knowledge and understanding of the principles guiding regulations and judicial decisions in each market, are the most relevant topics for multinationals regarding employment.
Technology is clearly influencing the market. The need to increase productivity and be competitive implies that some jobs disappear. On the other hand, new jobs are demanded in other sectors, but often require different skills. Then the problem is dismissals at one end of the market, and lack of skilled workers at the other end. There is no doubt about it: governments play an important role in building bridges between the two, and in working to a socially sustainable model. Social dialogue is key, in my view, to anticipating these situations. Particularly in our case, being a major niche labour and employment firm, we have the benefit of being present at many of these restructurings, and being able to discuss with the different stakeholders the best tools to help reduce the social impact of these decisions.
This is a major topic, and the consequences are still being studied and understood. Even our profession will be impacted, if it is not already being impacted by artificial intelligence. The education system needs to understand that there is a new world on its way, and it needs to help give solutions – since workers and professionals will need to find out how to add value, when competing, if possible, with the new technologies.