Argentina labor court reduces massive severance payout

A labor court in Lomas de Zamora, Argentina, has reduced a disproportionate severance payment to prevent what it termed a “patrimonial collapse” for a small security company. The dispute involved a private security guard whose initial 2019 claim of $818,648 had escalated to $46.6 million pesos due to automatic indexation mechanisms.

Judges María Florencia Farina, Carina Gómez Ansede, and Adriana Huguenin applied legal doctrines to adjust the figures, noting that the application of current modernization laws had multiplied the original capital 57 times. The court utilized precedents from the Supreme Court of Justice of the Province of Buenos Aires to mitigate the amount when applied formulas lead to extreme financial imbalance.