Labor Court Ruling Expands Liability for Third-Party Contractors in Argentina

In a significant ruling for Argentine labor law, the National Chamber of Labor Appeals (CNAT) confirmed that “Darling Tennis Club” shares joint liability for the dismissal of a worker employed by a catering contractor operating on its premises. The court’s decision, issued in the case *García de Pirela Eylin Janethe c/ Lanzillotta José Antonio y otros*, emphasizes that institutions cannot evade labor obligations when they exercise operational control over outsourced services.

Why the Court Applied Joint Liability

The CNAT, specifically Sala IV, determined that the gastronomic service provided on the club’s grounds fell under the scope of Article 30 of the Labor Contract Law (LCT). This statute mandates that companies or institutions that outsource activities inherent to their core business—or those that constitute a “normal and specific” part of their operation—are jointly liable for the labor obligations of their contractors.

The court found that Darling Tennis Club did not merely lease space to the catering firm. Instead, the institution maintained significant oversight, including:
* Direct influence over pricing and menu structure.
* Control over operational hours and event scheduling.
* Participation in disciplinary matters regarding the contractor’s staff.

Because the club acted as an integral part of the “technical unit of execution” for the restaurant, the judges concluded that the club failed to exercise the due diligence required to monitor the contractor’s compliance with labor laws.

Evidence and Presumptions of Irregularity

The ruling favored the worker, Eylin Janethe García de Pirela, after identifying significant discrepancies in her employment records. The court prioritized the testimony of a fellow employee over the statements provided by the defendants, which the judges characterized as “ambiguous and imprecise.”

Furthermore, the court invoked Article 55 of the LCT, applying a legal presumption in favor of the worker because the employer failed to produce the mandatory labor records (Article 52 LCT). This failure allowed the court to accept the worker’s version of her start date and actual working hours as accurate.

Updates on Indemnification and Inflation Adjustments

The Chamber rejected the defendants’ attempt to avoid penalty payments by citing the 2023 deregulation measures. The judges affirmed that labor disputes must be adjudicated based on the regulations in effect at the time the events occurred. Consequently, the court upheld:
* Indemnification enhancements under the Law 25.323.
* Payments related to Article 80 of the LCT.
* The doubling of severance pay established by DNU 34/2019.

On the critical issue of interest and inflation, the court declared Article 7 of Law 23.928 unconstitutional in this specific instance. Citing recent Supreme Court precedents—including *Oliva*, *Lacuadra*, and *García*—the Chamber ruled that applying standard interest rates would “pulverize” the value of the worker’s credit due to high inflation. To preserve the “food-related character” of the debt, the court ordered the capital to be updated using the Consumer Price Index (IPC) published by INDEC, plus a pure annual interest rate of 3%.

Key Takeaways for Employers

This ruling serves as a reminder for associations and businesses that outsourcing does not equate to a transfer of legal risk. When an entity exerts control over an outsourced service, courts will likely interpret the relationship as a single economic unit.

The decision also clarifies that while the current legal landscape in Argentina has shifted, courts remain committed to protecting the real value of labor credits against inflationary pressure. Employers who fail to maintain proper documentation or who exert excessive control over third-party staff face substantial exposure to joint liability and inflation-adjusted damages.