Jul 21
Labor Reform and changes in hiring employees
July 21, 2017
Get up to date in the changes in the Labor Reform.
Law No. 4 of January 26, 2017, establishing The Labor Transformation and Flexibility Law (the “Law), commonly known as the Labor Reform, brings important changes to hiring employees. As a business owner, you should be up to date on these changes. Among what's new, Attorney Anabel Rodríguez Alonso, a partner in the law firm of Schuster Aguiló, LLC, noted some areas of particular importance:
I. Probation period
-
- Under the Labor Reform, a written contract between the employer and employee is not required.
- Exempt employees (i.e., executives, managers and professionals, as defined by the Federal Labor Standards Act and the Department of Labor and Human Resources Regulations) will have an automatic probationary period of 12 months.
- The probationary period for non-exempt employees increases from ninety (90) days to nine (9) months under the Law.
- The probationary period will be interrupted when the employee takes a leave authorized by Law (i.e., illness, military or pregnancy). Once the employee returns to work, the probationary period will continue for the established term.
- Has an employer identification number or employer Social Security number
- Has filed income tax returns claiming to be self-employed
- Has an established working relationship through a written contract, and
- Has been contractually requested to have permits or licenses, among other credentials.