Argentina: Executive Order Amends Occupational Risks Regime
The National Executive Power enacted through the Executive Order of Urgency and Necessity Number 54/17 (hereinafter, the Order), a series of amendments that substantially alter the Occupational Risks Regime existing to date.
The Order largely reproduces the terms of the bill Supplementary to the Occupational Risks Regime, which had already received approval from the Senate and was awaiting for approval from the Lower House.
As established in its recital, the purpose of the Order is to reduce the proliferation of individual litigation which has jeopardized the original purpose of the Occupational Risks Law Number 24,557 (hereinafter, LRT) and amendments thereto.
The terms of the Order have entered into effect on January 24, 2017. Notwithstanding the foregoing, the National Congress' Permanent Joint Commission shall rule on whether the Order is valid or invalid, and such ruling shall then be set for review by both Houses.
II. Medical Committees
a) Mandatory Instance
The Order establishes that the jurisdictional medical committees will become the mandatory, prior and exclusive administrative instance to which workers must resort in order to request the provision of the monetary benefits foreseen in the LRT, or the approval of the agreement entered into by and between the parties. The resolution that the medical committee issues within the framework of the aforementioned process, will formally put and end to the administrative instance.
The above shall not apply with regard to those workers who are under an unregistered employment relationship with employers that have not affiliated to an Occupational Risks Insurer (ART), and therefore are entitled to pursue their claim in court without the need to go through the prior instance with the medical committees.
The jurisdictional competence of the intervening medical committee shall be determined on account of the location wherein the worker renders services, or, alternatively, the place where he/she reports to work.
To intervene in the process, the worker must mandatorily have the assistance of an attorney. Resolutions issued by the jurisdictional medical committees or the Central Medical Committee shall enjoy a res judicata effect, provided they are not subject to appeal or review. In other words, they shall be final and binding for the parties.
The Order provides for the creation of Approval Service within the sphere of the jurisdictional medical committees. It further states that it is the responsibility of the Occupational Risks Supervisor (hereinafter, SRT) to issue the rules that will govern the procedure before the jurisdictional medical committees and the Central Medical Committee.
In any event, the Order indicates that the jurisdictional Medical Committee shall have a maximum term of 60 administrative days to issue its decision. Said term may be extended for duly documented reasons related to the proof of the occupational accident or professional illness.
The elapsing of the term without the Medical Committee issuing any decision shall entitle the individual concerned to pursue the claim in court, and shall place the Medical Committee in a situation of gross misconduct.
Upon receiving the decision of the jurisdictional medical committee, the Order proposes two possible alternatives for review. First, by the Central Medical Committee. Second, by filing an appeal before the ordinary labor courts of the provincial jurisdiction or the City of Buenos Aires, as appropriate. In the event that the review of the Central Medical Committee is pursued, this new decision may be subject to a further instance of appeal before the higher courts.
The legal action brought by the worker will "attract" to it, any such action that may have been brought by the Occupational Risks Insurance before the Central Medical Committee.
The Order provides that all appeals filed shall have a suspensive effect, which means that the monetary benefits derived from the disability determination will only be paid once the appeal is heard and the contested resolution becomes final.
d) Medical Expert Witnesses
Substantially departing from the existing regime, the Order provides that only medical Experts Witnesses that are members of the Medical Forensic Body may intervene in the process.
Furthermore, the Order establishes that the experts' professional fees shall not be variable nor based on the amounts sought in the lawsuits, bur rather determined on account of the work actually performed.
The Order proposes to ban contingency fee agreements in court proceedings in the matter of occupational accidents or illnesses, therefore adopting the doctrine established in the en banc judgment of the National Labour Court of Appeals in re "Vallejo, Carla Natalia Lorena v La Holando American Insurance Company SA in the matter of accident - special law " dated 06/21/2016. Here again, the Order departs from the common practice.
The Provinces' and the City of Buenos Aires' adherence to the regime proposed by the Order will imply the express delegation to the federal jurisdictions of all powers and competencies that might be necessary for the setting up of the jurisdictional medical committees and their described operation.
On another note, as established in the Order, the National Executive Power must, within the term of six months, elaborate a re-arranged text of the LRT, its modifications and Law 26,773.
III. Amendments to the LRT
With the purpose of consolidating a more equitable regime, the Order proposes a series of changes to the System, amending some of the sections of the LRT. Amongst those amendments, the following are the most relevant:
a) Temporary Working Disability ("ILT)
The ILT term is extended to two years. Therefore, the ILT shall terminate for the following reasons: medical discharge, declaration of Permanent Working Disability, death or the passing of two years counted as from the first incapacitating manifestation. For purposes of calculating this two years term, all periods during which the worker would have been unable to work on account of the same accident or illness must be added.
b) Base Income
The Order proposes an amendment with regard to the monthly base income that is computed for purposes of calculating the monetary benefits. Indeed, for its calculation it takes into consideration the average of all remunerations accrued by the employee - in line with the terms of ILO Convention Nbr, 95 - prior to the first incapacitating manifestation, or time of service is lower. Additionally, the remunerations taken into consideration to establish the average shall be monthly updated according to the RIPTE (average taxable remunerations of stable workers) index.
The base income will accrue an interest equivalent to the Active Rate of the General 30 day Portfolio of the Banco Nacion, calculated as from the date of the first invalidating manifestation and until approval or determination of the worker's permanent incapacity or his/her death.
c) Termination of Insurance Contract
Failure to pay two monthly fees, whether consecutive or not, or the accumulation of total debt equivalent to monthly fees shall entitle the ART to terminate the Workers Compensation Insurance Contract. Notwithstanding the foregoing, the ART shall provide benefits in kind for any contingencies that take place within 3 months after the termination of the contract. The ART will then be allowed to pursue the recovery of these costs from the employer.
d) Deposit of severance or monetary benefits
Monetary benefits and severance which the workers are entitled to, whether on account of an administrative or judicial decision, shall be deposited in the employees' "Salary account" ("Cuenta Sueldo").
Failure to pay severance on time shall turn article 770 of the Nacional Civil and Commercial Code applicable, meaning that interest shall be accumulated to principal and its sum shall accrue interest equivalent to the Active Rate of the General 30 day Portfolio of the Banco Nacion,
e) Health Care Expenses
Health care expenses which the employees; private medical insurance incur in and foreseen in the LRT shall be borne by the ART. Conversely, the employees' private medical insurance must pay back to the ART the benefits in kind that the latter provides and that derive from non-occupational accidents or illnesses that are not foreseen in the LRT.
f) Public Order
All provisions are of a public order nature and, as such, may not be waived or repealed, even with express consent.
IV. Public Provincial Self-insurance
The Order foresees the setting up of a Public Provincial Self-insurance whose purpose is to enable provinces and municipalities to auto-insure, with regard to their employees, the occupational risks established in the LRT, with regard to their employees.
Each jurisdiction must guarantee the existence of a suitable structure for the granting of the benefits in kind that are foreseen in the LRT. In connection with monetary benefits, these must be administered through a regime which is separate from the province's general accountancy.
Public Provincial Self-insurers will be responsible for the same obligations as those borne by the ART.
The Order also sets out the procedure that must be followed by the Provinces and the municipalities that opt for this regime.
The SRT is responsible for overseeing that the regime is complied with.