On July 27, 2021, Law No. 21,361 was published, amending the Labor Code and granting legal validity to electronic labor documents such as severance agreements, resignations, and mutual agreements.

With regard to the severance payment, we highlight the following:

1. The employer's obligation to inform, in the notice of termination of contract, whether the severance pay will be granted and paid in person or electronically. However, it is voluntary and optional for the employee to accept either of these forms, and they may always opt for the in-person alternative; in which case, the employer has a period of 10 business days from the employee's separation or 3 business days from the employee's rejection of the electronic severance pay to make it physically available in person. Payment to the worker by electronic means will be made through the General Treasury of the Republic.
2. If the employee chooses the electronic option, the employer shall be obliged to expressly inform them of the possibility of reserving rights and/or taking action at the time of signing the electronic settlement agreement, if deemed necessary.
3. The settlement agreement, resignation, and mutual agreement signed electronically shall be considered ratified before the IPT.
4. It was expressly established that the discharging effect of the settlement agreement shall be restricted only to those matters expressly agreed upon by the parties.
5. The Treasury Service shall be responsible for receiving, collecting, and, where applicable, safeguarding the corresponding payments until they are delivered to the respective worker.

The respective law shall enter into force on the date of publication of the resolution issued by the Labor Directorate, as indicated in the sole article, which must be issued within 90 days of the publication of this law.

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