Source: http://www.ilo.org/dyn/eplex/termmain.showCountry?p_lang=en&p_country_id=75&p_expandcomments=Y
Timestamp: 2019-12-14 15:10:32
Document Index: 134859002

Matched Legal Cases: ['Art. 2', 'Art. 3', 'Art. 78', 'Art. 75', 'art. 74', 'art. 74', 'Art. 213', 'Art. 215', 'art. 213', 'Art. 216', 'art. 213', 'Art. 215', 'art. 225']

Source and scope of regulations - 2010
Workers' categories excluded: civil/public servants; members of cooperatives
Art. 2 LC: Civil servants are governed by civil service rules, except in those cases where any provision of the LC is expressly stated to be applicable to them.
Art. 3 LC: Agricultural and agro-industrial cooperatives are governed by the special regulations.
Note that Act No. 34 of 1979 regulates the working conditions of Balboa and Cristóbal dockworkers and its relationship with the employer. (Act abrogated in October 2012)
Types of employment contracts - 2010
Art. 78 LC: a probation period can be stipulated when the work requires certain aptitudes or special skills. The maximum duration of the probation period is three months, provided that it is expressly contained in the written contract of employment.
Art. 75 LC: The duration of a contract for a specified period is valid only:
* where the nature of the work performed so permits;
* if it is made for the purpose of temporarily replacing a worker who is on leave, on vacation or absent because of any temporary impediment; or
* in the other cases provided for in the LC.
No statutory limitation on renewals provided that the total duration does not exceed 1 year.
Contracts concluded for a job requiring special technical skills can however be renewed twice within a 3-year-period in the cases where vocational training is provided by the employer: art. 74 LC.
Maximum cumulative duration of successive FTCs: 12 month(s)
Contracts may be made for an unspecified period, for a specified period of not more than one year, except in the case of services requiring special technical skills, in which case the duration may be stipulated for a maximum of three years: art. 74 LC.
% of workforce under FTC: 77 %
Statistics for 2007: includes contracts concluded for specified period (definido) 44.9 % and for a specified piece of work (obra determinada)
Source: Ministry of Labour (http://www.mitradel.gob.pa/estadisticas/Contratos.pdf)
Substantive requirements for dismissals (justified and prohibited grounds) - 2010
Procedural requirements for individual dismissals - 2010
Procedural requirements for collective dismissals for economic reasons (redundancy, retrenchment) - 2010
No definition of collective dismissal.
However, there is a definition of "economic reasons" for dismissal. The law provides for a specific regime applicable to any dismissal (individual or collective) based on economic reasons.
Art. 213 C) LC: The following are valid economic reasons for the employer to terminate the contract of employment:
- the employer's bankruptcy or insolvency;
- the closing down of the undertaking or retrenchment, due to the undertaking obviously not being able to pay its way, or to the exhaustion of raw materials in the case of extractive industries;
- the final and permanent termination of the activity which is the subject of the contract; and
- the duly proven reduction of the employer's activities due to serious economic crisis or part of the operations not paying their way on account of decline in production or innovations in the production process or manufacturing plant; or the fact that an official tender or concession is called in or lapses; cancellation of sales or purchasing orders, or any similar reason duly proven by the competent authority.
Art. 215 LC: If an employer contemplates dismissing a worker for any of the reasons stated in art. 213, clause C (valid grounds for dismissal based on economic reasons), the employer must furnish evidence to the labour administration authorities.
Dismissal carried out without the fulfilment of that requirement is considered wholly unjustified. However, if after 60 calendar days the labour administration authorities have not issued a decision on the application, the employer may proceed to give notice of dismissal, which will be considered entirely proper but which will require the payment of the compensation prescribed by the LC.
Art. 216 LC:
The labour administration authorities called upon to take a decision respecting the granting of prior authorization to terminate a contract or dismiss a worker on economic grounds must personally inform the worker or workers concerned of the employer's making an application, giving them a time limit of three days to present their case.
The authority must examine the evidence within a reasonable period and issue an immediate decision granting or refusing the authorization applied for.
After being notified, the parties may appeal against the decision to the next higher competent authority, such appeal acting to suspend the decision.
In the event of dismissal for economic reasons, the following rules are applied (art. 213(C)(3), LC):
- the first workers to be affected are those having the shortest length of service in the categories concerned;
- after that, in deciding which workers are to be maintained on the staff, preference should be given to Panamanian workers (over aliens), to workers who are members of the trade union (over those who are not), and those who have shown the most efficiency should be given preference over less efficient workers;
- expectant mothers, even if they are not protected by the preferential treatment, should be laid off last of all and only in cases of absolute necessity, with due observance of all the legal formalities; and
- all other things being equal, after the above rules have been applied, workers protected by their trade union status or office have preference over the other workers as regards maintenance of their contracts.
Severance pay and redundancy payment - 2010
Redundancy payment: Redundancy payment shall amount to compensation for unfair dismissal.
In the case of employment commencing after April 1972, redundancy payment should be equivalent to3.4 weeks of wages for each year worked in the ten first years; and each year after ten years should be paid with the equivalent of one week's wages for each year. Where a full year has not been completed, the corresponding proportion is due.
For contracts concluded before April 1972, see compensation for unfair dismissal under "avenues for redress".
Art. 215 LC: redundancy payment shall amount to compensation for unfair dismissal as established by art. 225 LC.
1) Dismissal with cause (not economic): no severance pay.
2) Economic dismissal: redundancy payment = compensation for unfair dismissal.
3) Dismissal of workers not subject to the just cause requirement (workers with less than two years of uninterrupted service; domestic employees; permanent employees of small agricultural, fishing or manufacturing undertakings; seafarers serving on board vessels operating on international routes; apprentices; workers in retail sales establishments and in undertakings with five or fewer workers, except in the case of insurance establishments or real estate): compensation for unfair dismissal
Avenues for redress (penalties, remedies) and litigation procedure for individual complaints - 2010
Source of additional information - 2010