(a) No.
(b) No.
(c) No
(a) No.
(b) No.
(c) No
There is ongoing social debate regarding the work of delivery persons within the framework of digital platforms and their presumed right to be deemed as employees. Although Congress has passed some bills recognizing their right to be considered as employees and to be included in social security, there has been no significant progress in recent years.
With the rise in digital platform services, we are seeing an increasing global trend in case law and legislation aimed at protecting platform workers' labor rights. For more insight on these developments, along with other employment law updates, click here.
The main employment law risk is misclassification, which could result in individuals being considered as regular employees, thereby entitling them to all associated benefits such as social security, employment benefits and other related entitlements.
The Labor Authority (Superintendencia Nacional de Fiscalización Laboral (SUNAFIL)) could impose administrative sanctions upon the recognition of misclassification. The fines will be calculated based on the severity of the infringement (mild, serious and very serious) and the number of affected employees. The sanction will be between USD 390 and USD 70,000 per infringement, with a total of up to USD 400,000.
The employee will be entitled to request the payment of social benefits up to four years after the end of the relationship when this is recognized as employment.
The request of a contractor to be recognized as an employee before the labor courts may start a procedure leading to damages for wrongly classifying someone as self-employed.
The main tax risk is misclassification, leading to liability for not withholding wage tax and social security contributions.
Administrative sanctions are imposed for not withholding income tax. The amount of the sanction is 50% of the income tax not withheld, plus interest.
The company will also be obliged to pay to the tax authority the difference between the income tax withheld (as contractor) and the real income tax resulting from the employee status.
The main social security risk is misclassification. This would imply the following:
- Administrative sanctions being imposed for breaching social security obligations and health and safety obligations.
- The request of a contractor to be recognized as an employee before the labor courts may start a procedure leading to damages for wrongly classifying someone as self-employed, as well as for the payback of all the social security contributions.
SUNAFIL could impose administrative sanctions upon the recognition of misclassification. The fines will be calculated based on the severity of the infringement (mild, serious and very serious) and the number of affected employees. The sanction will be between USD 390 and USD 70,000 per infringement, with a total of up to USD 400,000.
The main social security risk is misclassification. Therefore, upon reclassification as an employee, the company must enroll employees in the security pension system they chose (private or public).
This will also lead to administrative sanctions for breaching pension obligations.
SUNAFIL could impose administrative sanctions upon the recognition of misclassification. The fines will be calculated based on the severity of the infringement (mild, serious and very serious) and the number of affected employees.
The sanction will be between USD 390 and USD 70,000 per infringement, with a total of up to USD 400,000.