On March 3, 2023, U.S. District Court Judge Laura Taylor Swain, presiding over Puerto Rico’s bankruptcy, issued an opinion declaring Act 41-2022 (Act No. 41) null and void ab initio.
Law 41-2022 Amendments
Act No. 41, which took effect in June 2022, amended several employment regulations that had been established by the 2017 Labor Transformation and Flexibility Act (LTFA). As previously reported, Act No. 41 sought to broaden several labor rights applicable to employees in the private sector. Specifically, the Act provided the following employment benefits:
- Limited the probationary period to a maximum of three months;
- Increased accrual of vacation and sick leave;
- Extended the statute of limitations for workers to claim benefits derived from an employment contract to three years;
- Required bonuses for eligible employees;
- Mandated severance pay, calculated based on years of service, for employees dismissed without just cause from positions for an indefinite term;
- Provided for ambiguous provisions to be interpreted in favor of the employee;
- Directed employers to provide meal periods based on number of hours worked; and
- Established that certain employees were entitled to one day of rest for every six days worked.
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