What to Do if Final Severance is Not Paid Within 4 Business Days
Employers must pay final severance within 4 business days under Articles 128 and 255 bis LCT; failure to pay triggers automatic default, interest, and formal demand telegrams.
Has your employer failed to pay within 4 business days?
Demand immediate payment and accrued interest with Lead Attorney Dr. Guillermo Conti:
Essential Legal Distinctions
- Automatic Default on Day 5: Employers enter formal legal default without requiring prior court intervention.
- Unilateral Installments are Prohibited: Companies cannot split severance payments without formal SECLO homologation.
- Accrues Mandatory Court Interest: Unpaid balances generate daily interest under National Labor Court rates.
1. Mandatory 4-Business-Day Statutory Deadline (Arts. 128 & 255 bis LCT)
Article 255 bis of the Employment Contracts Act establishes that all final wages and severance payments must be disbursed within four (4) business days following employment termination.
Upon expiration of this window, the employer enters into automatic legal default (Article 137 LCT), immediately triggering statutory court interest rates under CNAT precedents.
2. Formal Demand Telegram Procedure
If payment is not credited by the 4th business day, the employee must dispatch a statutory demand telegram (Law 23,789) granting 48 hours to disburse full funds under penalty of launching SECLO conciliation and claiming Article 80 statutory documentation penalties.
Frequently Asked Questions
What items must be paid within 4 business days?
All accrued items: days worked, prorated statutory bonus, accrued vacation payout, and Article 245 severance plus notice pay.
Does the dismissal date count toward the 4 days?
No. The 4-business-day timeline begins running on the first business day following termination notice.
Can an employer unilaterally pay severance in installments?
No. Installment plans are unlawful unless formally negotiated and approved before the Ministry of Labor or SECLO.
What if the company deposits less than owed?
Sign the receipt under protest (Article 260 LCT) and dispatch formal demand telegrams for unpaid balances.