The Central American Free Trade Treaty fully meets the labor objectives
set out by Congress in the Trade Promotion Act of 2002 and makes labor
obligations a part of the core text of the trade agreement.
The agreement includes unprecedented provisions that commit Central
American Free Trade Treaty countries to provide workers with improved
access to procedures that protect their rights.
The Central American Free Trade Treaty goes beyond Chile and Singapore
free trade agreements through a three-part cooperative approach to
improve working conditions by:
1. Ensuring effective enforcement of existing labor laws.
Agreement requires that all parties shall effectively enforce their own
domestic labor laws, and this obligation is enforceable through the
Agreement's dispute settlement procedures.
2. Working with the International Labor Organization to improve existing labor laws and enforcement.
International Labor Organization found that Central American nations
have laws on the books that are largely consistent with International
Labor Organization core labor standards.
Central American governments are now working to address gaps between
existing laws and International Labor Organization recommendations.
For example, in response to the recent International Labor Organization
report, several Central American countries have already drafted new
legislation and regulations, dramatically increased funding for their
labor ministries, expanded the number of labor inspectors, and
streamlined procedures for creating unions.
Costa Rica, El Salvador, Guatemala and Nicaragua have each carried out
major revisions of their labor codes over the last decade.
All parties reaffirm their obligations as members of the International
Labor Organization, and shall strive to ensure that their domestic laws
provide for labor standards consistent with internationally recognized
labor principles.
Agreement clearly states that it is inappropriate to weaken or reduce
domestic labor protections to encourage trade or investment.
A comprehensive three-part strategy to improve worker rights in Central America.
3. Building local capacity to improve worker rights.
The Central American Free Trade Treaty includes a groundbreaking
cooperation mechanism to promote labor rights through specialized
consultations and targeted training programs in the areas of child
labor, public awareness of worker rights, and labor inspection systems.
Public participation, including the input of worker and employer
organizations, is called for in the design and implementation of
technical cooperation activities.
As part of the Central American Free Trade Treaty process, the U.S.
Department of Labor has allocated $6.7 million to educate Central
Americans on core labor standards and to improve the administrative
capacity of the Central American Free Trade Treaty countries in labor
matters.
The U.S. Department of Labor will also support efforts aimed at
reducing exploitative child labor. Through the International Labor
Organization's program to eliminate the worst forms of child labor,
U.S.-funded projects will remove children from hazardous and
exploitative work and provide them with educational opportunities.
The
many ways to lose an employee
By Garland M. Baker Special to The CAFTA Report
There
is a lot of myths surrounding how an employer must treat an employee,
particularly if the issue is termnination. One such myth is the
so-called three-letter rule.
Many employers believe that they must give three warnings. that is not supported by the law.
The Código de Trabajo or labor code Article 81 refers to “causes
for firing an employee” but does not refer to a warning anywhere except
in Section i. This section states the following: “when a worker,
after an employer’s first warning, commits another fault described in
Article 72, Sections a), b), c), d) and e) the act is sufficient for
dismissal.”
Here is a gist of the content of those sections:
a.) Abandoning work during working hours without just cause or
permission from the employer;
b.) The promotion of political, electoral propaganda and/or spreading
information against the democratic institutions and religious liberty
guaranteed by the constitution;
c.) Working under intoxication, drunkenness or a similar state;
d.) Using work tools and/or supplies for something other than their
defined use,
e.) Carrying a firearm during work hours unless doing so is authorized
or the gun is a tool of the job.
This would lead a reader of the labor law to surmise that any other
infraction not listed above is sufficient for immediate firing.
However, this is not the case. Recent court decisions state an employee
should be given the chance to correct any fault. Neither the law
nor the court decisions state how many chances an employee should
get. Jurisprudence does dictate that giving an employee too many
chances gives the worker judicial security turning a fault into the
norm.
There is something else in the labor law that most people and even
legal professionals do not know. An employer only has one month
to censure an act that constitutes a firing offense. To censure
means to reprimand or fire the employee. The custom of giving employees
warning letters is to document breaking the rules for a court
proceeding if one should arise. A verbal censure with two
witnesses is also sufficient. This said, it is better to use the
customary warning letter not witnesses.
Here is a list of firing offenses:
1.) Acting in an immoral, insulting or slanderous manner during work
against the employer;
2.) Acting in an immoral, insulting or slanderous manner during work
against a fellow worker if the such behavior alters the worker’s labor;
3.) Acting in an immoral, insulting or slanderous manner away from the
workplace against an employer or representatives unless the behavior is
provoked;
4.) Using property, machinery, tools, prime materials, products and
supplies of the employer in an illegal or illegitimate way;
5.) Reveling trade secrets;
6.) Putting the workplace or fellow
worker at jeopardy due to an
imprudent, neglectful act;
7.) Not showing up for work for two consecutive days or for more than
two days in a calendar month;
8.) Not following procedures to prevent accidents or sickness or
not following directions to improve work performance and efficiency;
9.) Violating the sections of Article 72 after a first warning;
10.) Lying about work qualifications and/or references;
11.) Getting a prison sentence;
12.) Any other fault set forth in a labor contract with the employer.
In summary, the Costa Rican law labor is unclear about warning
employees regarding committing acts that warrant dismissal from their
jobs.
Only one section of one article in the entire law even mentions a
warning. However, court jurisprudence suggests employers must
give
their employees a chance to correct wrongs.
Thus, this writer recommends giving employees at least one written
warning letter for an offense warranting firing. An
employer should
write the letter to the employee in Spanish and it should go something
like this:
“You have committed an act described in Article 81 of the Costa Rican
labor law, and we are calling your attention to the fault.” The
employer should describe
the fault in the letter.
If the employee commits another violation, an employer should fire them
immediately without employer responsibility. The employer should
use
another letter that says, “You are dismissed for committing an act
described in Article 81 of the Costa Rican labor law.” The
employer
should describe the fault in the letter but not mention the first
letter.
Without employer responsibility means the employer will not pay the
employee separation pay, which comprises two parts: 1.) preaviso,
notice pay, and 2.) cesantia,
severance pay. An employee’s accumulated vacation and Christmas
bonus
are untouchable, and even a fired worker has the right these amounts.
Cesantia can be significant, up to eight months of pay for an employee
who has worked eight years for the employer.
Almost all expats who come to Costa Rica have to deal with workers.
Whether they are domestic help or laborers in a company, going to labor
court is a nightmare and usually the bosses lose when battling with a
worker in court. At least knowing how to fire a bad
employee is a
start in the right direction. Following these guidelines does not
guarantee a court win but only a better chance of not losing so
miserably.
Garland M. Baker provides multidisciplinary professional services to the
international community.
Copyright 2008. Use without permission prohibited.
A brief rundown
of annual tax dates
To avoid getting a surprise from
the tax man this next tax year, print and pin this article to your refrigerator.
Here is the most important tax filing deadlines. If a date
falls on a weekend, or holiday, the deadline is moved ahead to the next
business day.
January
Employee withholding due Jan. 15. Form D.103
Sales Tax due Jan. 15. Form D.104 and D.113
Simplified Tax Reports due Jan. 15. Form D.105
February
Employee withholding due Feb. 15. Form D.103
Sales Tax due Feb. 15. Form D.104 and D.113
March
Employee withholding due March 15. Form D.103
Sales tax due March 15. Form D.104 and D.113
Income tax partial payments due March 31. Form D.108
Educational and culture Tax due March 31. Form D.110
April
Employee withholding due April 15. Form D.103
Sales tax due April 15. Form D.104 and D.113
Simplified tax reports due April 15. Form D.105
May
Employee withholding due May 15. Form D.103
Sales tax due May 15. Form D.104 and D.113
June
Employee withholding due June 15. Form D.103
Sales tax due June 15. Form D.104 and D.113
Income tax partial payments due June 30. Form D.108
July
Employee withholding due July 15. Form D.103
Sales tax due July 15. Form D.104 and D.113
Simplified tax reports due July 15. Form D.105
August 2005
Employee withholding due Aug. 15. Form D.103
Sales tax due Aug. 15. Form D.104 and D.113
September
Employee withholding due Sept. 15. Form D.103
Sales tax due Sept. 15. Form D.104 and D.113
Income tax partial payments due Sept. 30. Form D.108
October
Employee withholding due Oct. 15. Form D.103
Sales tax due Oct. 15. Form D.104 and D.113
Simplified tax reports due Oct. 15. Form D.105
November
Employee withholding due Nov. 15. Form D.103
Sales tax due Nov. 15. Form D.104 and D.113
Employee withholding summary due Nov. 30. Form D.150
Sales and purchases summary due Nov. 30. Form D.151
December
Employee withholding due Dec. 15. Form D.103
Sales tax due Dec. 15. Form D.104 and D.113
Wheel tax (Marchamo) due Dec. 31. Form D-121
Income Taxes due Dec. 15. Form D.101 v2
