On July 14, 2021, the Department of Labour, by means of ruling No. 1826/024, issued a statement in which it explains the meaning and scope of those provisions of Law No. 21.360 that readjust the amounts of the Minimum Monthly Income and its effects on labor matters. Specifically, this statement indicates the following:

1. Retroactive effect of the law regarding the values of the Minimum Monthly Income:

Employers must adjust the base salary of workers, having to consider for this purpose that such adjustment is effective as of 01.05.2021, by virtue of the retroactive effect of Law No. 21.360 regarding the values of the Minimum Monthly Income, hereinafter “IMM”.

2. Adjustment in the MMI values and effects on the payment of social security contributions:

Employers shall adjust the value of the IMM to the new amounts established by the aforementioned law as from 01.05.2021, corresponding that, in the month of July 2021, they shall pay for such concept, the following values:

a. In the case of workers over 18 and up to 65 years of age, remunerated exclusively with the IMM, they shall be paid the salary of $337,000 plus the difference corresponding to the months of May and June of the current year, amounting to the sum of $10,500 for each of these months. Thus, the salary of such employees shall reach in July 2021, the total amount of $358,000 gross.

b. On the other hand, in the case of workers under 18 years of age and those over 65 years of age, remunerated exclusively with the IMM, they shall be paid the salary of $251,394 plus the difference corresponding to the months of May and June of the current year, which amount to the sum of $7,833 for each of these months. Thus, the salary of such employees shall reach in July 2021, the total amount of $267,060 gross.

In addition with the above, the declaration and/or payment of social security contributions for the same period must be regularized with respect to the aforementioned workers.

3. Effects on the calculation of bonuses:

 The obligation to re-state the differences that occur in the salaries of the workers as a consequence of the IMM readjustments, is applicable in the event that the employer has opted to pay the legal gratuity of the workers in accordance with the system established in Article 50 of the Labor Code.

Should you require additional information on this matter, please contact: Alfred Sherman (asherman@jdf.cl) and/or Felipe Ovalle (fovalle@jdf.cl).