March 25, 2020 SPECIAL COVID-19 ISSUE

CENTRAL AMERICA - Solutions Provided by Labor and Employment Law to Face the Effects of the COVID-19: A Central American Panorama

By: María Lucía Alvarado, Aguilar Castillo Love, Costa Rica

The arrival of COVID-19 in Central America has profoundly affected the operations of companies, which in turn has posed enormous challenges for labor and employment law. The sanitary measures imposed by the Central American governments, with the exception of Nicaragua, ranging from the closure of certain activities (hotels, restaurants, sports activities) to limiting the transit of people (including curfews), has forced the search for legal solutions to face this new panorama.

Costa Rican authorities stood out by quickly issuing a new law to allow the affected companies to reduce the working hours of their workers, and lower their wages in the same proportion, as a mechanism to avoid layoffs. New regulations have been decreed regarding the procedure to be followed before the Ministry of Labor to request a suspension of employment contracts, among other measures. Recently, a new law had been approved to regulate teleworking; its application has been further encouraged by the government during this crisis.

Furthermore, the case of El Salvador is to be highlighted, where by order of the Executive, both the public and private sector had to send home, without exception, workers over 60 years of age, pregnant women, and people with chronic diseases such as kidney failure, serious heart conditions, or other such conditions that the labor authorities would indicate. The companies had to carry out this measure in a remunerated way.

In Honduras and Guatemala, although new legislation has not yet been approved, an important migration towards telework has been noticed, promoted by state authorities as a measure to keep the economy working and prevent the spread of the disease. The suspension of labor contracts is also contemplated in their Labor Codes, where it could be alleged for reasons of force majeure among others.

On the other hand, the Nicaraguan case stands out for taking a different approach, since the government has announced that it will not be taking any massive sanitary measures that could affect the economy. Therefore, modifications to the labor regulations have not been taken.

The law has always faced the challenge of adapting to changes and evolutions in society. This is true today more than ever, and we must undertake this task with the urgency that the situation dictates.

María Lucía Alvarado

Aguilar Castillo Love, Costa Rica