Haynes and Boone's Newsroom

Recent Developments in South American Labor Law - Protecting Workers’ Rights or Adding to Labor Market Inflexibility?
06/10/2010
Larry B. Pascal

This article in Latin American Law & Business Report analyzes important labor law developments in Chile, Peru, Argentina, and Uruguay. In particular, it will focus on (a) discrimination claims in these respective countries and how and when they may arise, (b) trends and new developments in labor law, (c) areas of greatest activity in the respective countries, and (d) M&A considerations, including the acquired rights doctrine,restrictions on outsourcing, and other issues.

One important labor law principle, non-discrimination in the workplace, has historically played a larger role in the US than in South America. Employment discrimination is an important legal theory in the United States, as it creates an exception to the general U.S. rule of employment at will. Under this rule, either party is free to terminate the labor relationship with no liability to the other. However, the modern civil rights regime in the U.S. has re-shaped
the rule such that an employer may terminate an employee without liability for any reason that is not illegal.

Of course, the employment at will regime is rooted in a freedom of contract notion in the labor area that South America does not share and this article highlights how the view of equal or unequal bargaining position shapes labor law in South American countries.

To read the full text, please click on the PDF link below.