Julián de Diego: “In this context, layoffs will come alone; there is no decree to stop them”

INFOBAE – “Layoffs are not held by decree in this context, it is crazy to think that can be done. They’re going to give themselves, alone, and they’ll be informal in the smaller companies. The reality of every day is very different from what an official sitting at a desk who has no idea what’s going on in these companies might think,” labor law specialist Julian de Diegotold Infobae.

80 private companies of less than 50 people have no resources to pay salaries and social burdens. The Government is in the right way to promote measures, but so far they are very unreliable

In a context where the Government analyses some kind of suspension of layoffs by decree – or at least that the emergency situation cannot be used by the pandemic to do so – and after the strong crossing between Alberto Fernandez and Paolo Roccaof Techint, for the announcement of 1,450 layoffs (that the company ratified despite the conciliation),De Diego called for urgent measures for all companies, especially the smaller ones.

– How do you describe the context in which companies are?

– The economy is submerged by the effect of the pandemic in a catastrophe. There’s nothing worse for a company than having zero billing, that what you need to collect is deferred because the payment chain isn’t working. Companies are trying to hibernate to jump these three months in which there will be many vicissitudes. They seek to reach June-July, months when the economic impact of the pandemic will still be felt, but perhaps with the beginning of the revival. In all previous recent crises, the revival was very rapid, but that now seems very distant and more in a context that was already recession. Some sectors were at a good level, such as tourism and gastronomy, but everything fell into the basement. The slogan now is to survive, and no one can do so by keeping endowments to which wages have to be paid. Neither the big ones, nor the medians, let alone the small companies that already have trouble paying for March can do it. 80 private companies of less than 50 people have no resources to pay salaries and social burdens. The Government is in promoting, but so far they are very warm.

Companies are trying to hibernate to jump these three months in which there will be many vicissitudes. They are looking to reach June-July, months when the economic impact of the pandemic will still be felt, but perhaps with the beginning of the revival

– What measures do you think should be taken?

– Tax, VAT, profit advance, gross income must be deferred. Companies with zero selling and with no invoices have no chance of anything. Countries such as France, Spain and Italy have already decided to postpone some taxes and forgiveness from others. They also suspended facility plans. If I get credit at 24 percent interest with three months of grace and 12 pay-per-book installments, in three months I’ll have to pay salaries plus the credit with zero income. It’s an absurd benefit. What to avoid is payments. You can’t waive VAT payment because it’s a chain, or Profits, if you had them, but payment can’t be demanded now. There has to be postponements of everything for 90 days.

– Was it OK to extend quarantine?

– Quarantine extended for two weeks is a strategy to defeat the pandemic. It seems to be going well, if the data I don’t question is true. The community is acting fine. But to talk about regaining the activity you have to think from June onwards. Hotels and restaurants are paralyzed at ground level, as are very successful companies that are with closed plants because they make priority products. For all, payments must be postponed. If you’re going to keep demanding, we’re going to have a phenomenal list of bankruptcies. They will be formal in the case of the bigger ones and not so much for the girls who pass by the judge, close and leave everyone hanging. We have to start with them, which are the most vulnerable. Otherwise, no one will be able to get out of this catastrophe scheme.