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> GOVERNANCE - home > Employment protection legislation database - EPLex > Peru

Peru - Avenues for redress (penalties, remedies) and litigation procedure for individual complaints


Avenues for redress (penalties, remedies) and litigation procedure for individual complaints - Peru - 2019    

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Compensation for unfair dismissal - free determination by court: No

Compensation for unfair dismissal - Legal limits (ceiling in months or calculation method):
1) Arbitrary dismissal (= a valid reason has not been given or cannot be legally substantiated): No right to be reinstated, the worker is only entitled to compensation, as follows:
- Ordinary compensation = 1.5 month's wages for each year of service up to a maximum of 12 months' wages.
- Compensation in micro enterprises: 10 days for each year of service up to a maximum of 90 days' wages.
- Compensation in small enterprises: 20 days' wages for each year of service up to a maximum of 120 days' wages.

2) Dismissal based on prohibited grounds :
The dismissal is null and the worker shall be reinstated but in complying with the decision he or she may opt for compensation, the amount of which is the same as compensation for arbitrary dismissal (see 1)).

Remarks:
  • - See sec. 34 and 38 LPCL (general rules).
    On the specific compensation for arbitrary dismissal in micro and small enterprises, see Law on Micro and Small Enterprises [MSE], consolidated version of 2008, art. 47. Pursuant to that law, a micro enterprise is an enterprise employing 1 to 10 workers and whose maximum annual sales do not exceed 150 tributary tax units (Unidades Impositivas Tributarias (UIT)).
    A small enterprise is an enterprise employing 1 to 100 workers and whose maximum annual sales do not exceed 1700 tributary tax units (see art. 5 MSE)
    - In the event of a constructive dismissal, the worker may choose to bring an injunction against the employer's actions or he or she may choose termination of the contract. In case of such termination, he or she will be entitled to the payment of compensation equivalent to compensation for arbitrary dismissal (art. 30 LPCL)
    - Please note that compensation for arbitrary dismissal (art. 38 LPCL) is also due in the event the employer does not observe the preferential right of workers to be re-employed by their former employer within a year of a collective dismissal (art. 52 LPCL)

Reinstatement available: Yes

Remarks:
  • - If a dismissal is declared null and void (that means that the dismissal was based on prohibited grounds), reinstatement is mandatory. However, in complying with the decision the worker may opt for compensation instead (art. 34 LPCL)
    - There is no right to reinstatement in the event of an arbitrary dismissal (= a valid reason has not been given or cannot be legally substantiated). Compensation is the only available remedy is such case (art. 34 LPCL)

Preliminary mandatory conciliation: Yes

Remarks:
  • - The New Labour Procedure Law [NLPL], No 29497, in force from 15 July 2010 foresees a preliminary mandatory conciliation hearing and contains a much more detailed provision on the modalities of such preliminary hearing (art. 43).

Competent court(s) / tribunal(s): labour court

Remarks:
  • The New Labour Procedure Law [NLPL], establishes a hierarchy of courts to adjudicate labour disputes, consisting of the Magistrates Courts (Juzgados de Paz Letrados), the Labor Courts of First Instance (Juzgados de Trabajo), the Labour Branches of the High Court (Salas Laborales de la Corte Superior), and the Supreme Court (Corte Suprema). Dismissal cases are heard by the Labour Courts of First Instance (Juzgados de Trabajo). The extinction of the working relationship is observed by Specialized Labour Court as indicated in art. 2 and 51 of the NLPL.

Existing arbitration: Yes

Remarks:
  • Arbitration is recognized as a valid labour dispute resolution mechanism under certain conditions in the New Labour Procedure Law of 2010 (applicable from 15/07/2010): see supplementary provision 6).