Reforms to Puerto Rican Labor Law Reinstate Employee-Friendly Measures

On June 20, 2022, Puerto Rico’s governor signed into law Act No. 41-2022 (“the Act”). The Act rolls back certain changes brought about by the Labor Transformation and Flexibility Act (“LTFA”). The LTFA was enacted in 2017 in an effort to reenergize the island’s economy following its effective bankruptcy.

As described in more detail below, the changes made by the Act relate to accrual of sick and vacation leave and Christmas bonus eligibility, presumptions related to just cause and discrimination, the formula for calculating severance pay, probationary periods, the statute of limitations for various causes of action, the interpretation of employment contracts, and meal breaks.