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ECONOMY | 04-06-2021 23:56

Argentina’s famed ‘aguinaldo’ bonus – an explainer

It’s that time of the year again and there’s renewed curiosity on social networks about the origins of Argentina’s famed ‘aguinaldo,’ the benefit received by workers twice a year.

At the end of June in Argentina, the midyear bonus (amounting to half of the best salary in the first half of the year) is traditionally paid out, a benefit completely attributed thanks to an ideological bias to Peronism and its founder, Juan Domingo Perón. 

But alongside other worker benefits, the ‘aguinaldo’ was not in fact a Peronist creation – it thought out by others ahead of its implementation during the Presidencies of the General.

The term actually stems from the Celtic word “eguinad,” which their tribes paid out in times of abundance and was later picked up by the Roman Empire. Considerably more recently in history, in the closing decades of the 19th century, anarchists and socialists campaigned for an extra payment for workers, something then already being extended by shops to their “employees of the month,” but always on an informal and voluntary basis.

The first official payment of an aguinaldo bonus in Argentina dates back to 1910. City Mayor Manuel Güiraldes paid an extra salary named “Aguinaldo del Centenario” as part of the festivities marking the first 100 years of this nation.

The first to enact it into law at provincial level was Jujuy Radical Governor Benjamín Villafañe in 1924 but this covered public employees, not all workers. Law N° 619 defined this extra remuneration as “half a month of salary.”

Finally, Peronism and Colonel Perón show up in the history of the aguinaldo to extend it to all formally employed workers via Decree N° 33,302 (December 20, 1945) when the “first worker” (then still vice-president) founded the Instituto Nacional de Remuneraciones whose tasks included fixing the minimum wage and implementing the 'Sueldo Anual Complementario 'bonus.

During his first presidency this decree was made law exactly a year later (Law 12,921, December 20, 1946), although subsequently it was divided into two annual payments by Law Nº17,620 in 1968 with the first half to be paid in June and the second in December. It encompasses gross salary, commissions, overtime, future increases, expenses and attendance and punctuality bonuses.

 

When is the aguinaldo collected?

According to Article 122 of the Ley de Contrato de Trabajo, the first half should be paid by June 30 and the second by December 18.

New income tax law omits payment

This year the national government has adjusted income tax legislation to exempt workers earning up to a monthly gross salary of 150,000 pesos, while the aguinaldo bonus will cease to form part of the basis for calculating the levy.

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Carlos Piro

Carlos Piro

Periodista y editor de Perfil.com. Historiador de Chacarita Juniors.

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