The bill mandates the creation of a Compensation Fund for Unjust Dismissal with $ 100 million to compensate workers for wrongful dismissal (horizontal-x3)
The bill mandates the creation of a Compensation Fund for Unjust Dismissal with $ 100 million to compensate workers for wrongful dismissal. (GFR Media)

Yesterday, the House approved the bill that would progressively amend the Unjust Dismissal Law (Law 80-1976) after introducing amendments to create a fund that –with public funds- will subsidize those workers who have been dismissed without just cause until 2021.

La Fortaleza and the Oversight Board have endorsed the changes to Senate Bill 1011 approved by the House. However, before the piece reaches the hands of Governor Ricardo Rosselló Nevares, it will have to be ratified by the Senate, which will consider the measure on Tuesday.

The bill mandates the creation of a Compensation Fund for Unjust Dismissal with $ 100 million to compensate workers for wrongful dismissal. It will be funded with the $ 345 million reserve for economic development established in the agreement between the Board and the governor.

 The bill, hastily approved without debate, was voted by the New Progressive Party (PNP) majority, except representatives Gabriel Rodríguez Aguiló, Pedro Julio "Pellé" Santiago and José Enrique "Quiquito" Meléndez. The minorities opposed the measure, except for Popular Lydia Méndez and Carlos Bianchi, who were absent at the time of the voting.

House Speaker, Carlos "Johnny" Méndez, affirmed that this body acted responsibly and that it was a conscientious vote. He told El Nuevo Día that an employee who now earns $ 1,200, with Law 80 receives $ 2,000 and that, with the creation of the special fund, he would receive a compensation up to $ 5,000 for an unjust dismissal.

 Senator Carmelo Rios, spokesman for the Senate majority, told this newspaper that he has not seen the changes made to the measure, which would be discussed on Monday in caucus. The president of the Senate, Thomas Rivera Schatz, announced through social networks that the bill will be addressed on Tuesday´s session. He did not commit to favor the measure in his statement.

"The distraction that Law 80 has caused will end that day," said the senatorial leader.

"All legislators, in the House and the Senate, have voted and will vote, freely, according to their conscience," he added.

Meanwhile, the governor said that the version endorsed by the House is consistent with the agreement with the Board.

  "Along the way (of the legislative process), we have been able to work on a compensation fund for workers who will no longer have the remedies of Act 80 and a postponement of those effects until June 2021 for employees who have (worked for) 15 years or more.”," said Rosselló Nevares in written statements.

Two categories

Those amendments included in the bill create two categories of employees. The first classification with access to the special fund, will be employees with one to 15 years in their employment who may be lay off as of January 1, 2019, when Law 80 would be without effect for this group.

 The second category is that of employees with more than 15 years in their employment, who will be covered by Law 80 until June 30, 2021, when the law is to be repealed.

 The fund would receive the first $ 25 million next fiscal year and the next $25 million allocations would be disbursed over the next fiscal years until it reaches the $ 100 million cap.

 The fund will be administered by the Department of Labor and Human Resources.

 Employees in the first category will have access to compensation of up to $ 5,000 to be disbursed as a monthly allowance, and the employer who hires the dismissed employee will receive -from public funds- a tax credit to cover the first $ 4,500 earned by that dismissed employee in his new job. That credit would be reimbursed to the government by the contracting employer if the employee is dismissed within one year. The dismissed employee will receive the monthly allowance while still unemployed until reaching the $ 5,000 cap.

 The bill provides that, as of January 1, 2019, no employee with an indefinite term contract will have a cause of action against an employer merely because the employer terminates the employment relationship.

 Rodríguez Aguiló argued that the bill was not debated in the House because it had been "highly debated". "I am against repealing Law 80, and this is does it. It establishes a fund that is not permanent," said the majority legislator when expressing his rejection of the bill.

 "They are creating a fund with public funds, they are going to socialize (the payment of compensation)," said the Popular minority spokesman, Rafael "Tatito" Hernandez, when criticizing the budget, which is out of line since neither the tax reform nor the Incentive Code have been approved, "now they will take $ 25 million that they do not have".

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