Constructive Dismissal for Unpaid Wages

Constructive dismissal for unpaid wages happens when your employer stops paying your salary or 13th-month bonus and you, after giving formal notice, are forced to end the relationship through the employer's fault. Argentine law grants you the same right to compensation as an unjustified dismissal: full severance, notice pay, and month integration included.

What It Is and When Unpaid Wages Trigger Constructive Dismissal

Constructive dismissal (sometimes called self-dismissal) is the right granted to you under Section 242 of the Argentine Employment Contract Law (LCT) to end your employment contract when your employer commits a breach so serious that continuing to work for them is no longer reasonable. Failure to pay wages is, historically, the most common ground for constructive dismissal: salary has a subsistence-based nature under Argentine law — it supports you and your family — which is why labor courts apply a stricter severity standard to wage breaches than to other kinds of misconduct.

Your employer doesn't need to owe you several months of salary for a breach to exist. Total non-payment of a single month's wages, if it continues after you give formal notice, is on its own enough to justify constructive dismissal in the vast majority of cases. What the law literally requires is that the breach be serious enough that, given its gravity, it no longer allows the relationship to continue (Section 242 LCT); to weigh that gravity, judges look at the scale of the breach, how long it has lasted, and the specific circumstances of the case — there is no fixed number of days written into the statute.

Beyond your monthly salary itself, unpaid amounts that count toward a constructive dismissal claim include your annual supplementary salary (SAC, or 13th-month bonus), commissions already earned, regular collective-bargaining allowances, and any other agreed compensation your employer fails to pay on time.

Here is a key point most employees don't know: your salary falls into default automatically the moment the legal payment deadline passes, with no need for you to make any claim first for the debt to exist. But that automatic default doesn't, by itself, entitle you to stop showing up for work or to consider yourself dismissed without further steps: you first have to formally notify your employer. That notice gives your employer one last chance to comply, and at the same time puts on record, in writing, the exact date from which the breach is counted.

How to Give Notice Before Constructive Dismissal: Step by Step

The order of these steps matters as much as the content of each one. Skipping the notice requirement — or drafting it poorly — is the single most common way workers end up losing a severance claim that was, in substance, theirs to win.

1. Document the breach precisely. Note exactly what is owed to you: a full month's salary, a partial shortfall, the SAC, commissions. The more precise the claim, the harder it is for your employer to dispute it later.
2. Send formal notice through the free labor telegram (Law 23,789). It's free and can be sent from any Correo Argentino branch with your national ID. It must clearly identify the employment relationship, the period involved, and the exact amount owed, and set a concrete deadline for payment, warning that you will consider yourself dismissed through the employer's exclusive fault if it is not met.
3. Set a reasonable but short deadline. In practice, for unpaid-wage claims, attorneys use short windows — typically 48 to 72 hours — because non-payment of wages is already, by itself, a breach of immediate severity that doesn't call for the same leeway as lesser breaches.
4. Wait out the deadline without walking off the job. Keep working normally while the deadline runs, unless the non-payment is severe enough to also justify withholding your services.
5. If there is still no payment or response, only then send the second telegram. In that notice, you declare yourself constructively dismissed through the employer's exclusive fault, reference the earlier unanswered notice, and lay out the exact grounds — because afterward, in court, you won't be able to invoke grounds other than the ones you stated at that moment (the unchangeable-grounds rule, Section 243 LCT).

The entire process, from the first telegram through filing a labor claim, is free of charge for you under the full court-fee exemption of Section 20 LCT: you don't advance filing fees, stamp duties, or attorney's fees to litigate over your wages.

What You Can Claim If Your Constructive Dismissal Is Upheld

When a court — or your employer, if the debt is acknowledged — confirms that your constructive dismissal was justified, Section 246 LCT entitles you to collect exactly what you would have received had your employer dismissed you without cause:

• Seniority severance pay (Section 245 LCT): one month of your highest normal monthly salary for every year of service, or fraction over 3 months.
• Severance in lieu of notice: because your employer failed to give you the statutory advance notice a regular dismissal requires.
• Integration of the dismissal month: the days needed to complete the current calendar month, when the termination doesn't fall on the last day of the month.
• Prorated SAC and prorated untaken vacation (Section 156 LCT), together with the corresponding vacation premium.
• The unpaid wages that triggered the claim in the first place, plus interest from the date each payment became due.

Depending on the case, this can also include the aggravated penalties under Law 24,013 if part of your employment was unregistered or under-registered, plus any other outstanding compensation owed at the time of termination.

Mistakes That Cost You Your Severance

On the employee's side, most lost cases aren't lost over the underlying wage debt itself — that part is usually easy to prove — but over mistakes in the notice procedure that comes before it:

• Resigning outright, without giving notice first. This is the costliest mistake: a resignation ends the contract with no severance owed, even if the real reason was unpaid wages.
• Letting too much time pass between the default and the notice. Living with the arrears for months without raising a claim can be read as having, in effect, accepted the situation — which weakens any later claim.
• Sending a vague or incomplete telegram. If you don't precisely identify the period owed, the amount, and the warning of dismissal, your employer can later argue the claim was unclear.
• Declaring yourself dismissed before your own deadline expires. If you gave your employer 72 hours, wait out those 72 hours: an early constructive dismissal can be treated as premature and weaken your position.
• Changing your grounds once the case is filed. Under the unchangeable-grounds rule (Section 243 LCT), what you state in your constructive-dismissal telegram is, as a rule, the only thing you'll be able to argue later in court.

Frequently Asked Questions