The Labor Formalization Incentive Regime (RIFL) is intended to promote the incorporation of workers into registered employment through a significant reduction in employer contributions for new labor relationships that meet certain requirements.
For private sector employers, the regime may represent an opportunity to review the planning of new hires, estimate their impact on labor costs and adapt internal registration, settlement and compliance processes.
However, its application requires the validation of specific conditions related to the period of validity, the profile of the worker reached, the correct registration of the registration and the causes for exclusion or loss of the benefit.
Main aspects of RIFL
The benefit applies to employment relationships initiated and registered with ARCA between May 1, 2026 and April 30, 2027, both dates inclusive.
Among the central points of the regime, the following stand out:
- Social plans: may be maintained for up to 12 months from labor registration.
- Effective from 05/01/2026 to 04/30/2027.
- Duration: up to 48 months from the worker’s registration.
- Applicable benefit: reduction of employer contributions from 18% or 20.4% to 5%.
- Employers reached: private sector.
- Cap for new employers: up to 80% of payroll.
- Discharge record: Recruitment code 710.
- Registration system: registration before ARCA / Registry Simplification.
- Nature of the benefit: optional. If not exercised in due time and form, it is lost for that period.
Which workers may be covered?
The RIFL can be applied for each new incorporation, provided that the employee meets at least one of the conditions set forth in the regulations.
They can be reached:
- Workers without a registered employment relationship as of December 10, 2025.
- Unemployed persons during the six months prior to discharge.
- Single taxpayers who meet additional conditions.
- Workers whose last employment was in the national, provincial, municipal or Autonomous City of Buenos Aires public sector.
In the case of workers coming from the Monotax system, specific conditions related to the absence of previous registered private employment must be verified.
How to record the benefit
In order to apply the regime, the worker’s registration must be made before ARCA using the Hiring Modality Code 710, corresponding to the Incentive Regime for Labor Formalization – Law 27,802.
In addition, registrations recorded between May 1, 2026 and the entry into force of the General Resolution must be rectified to indicate code 710, in order to access the benefit.
This point is especially relevant for Payroll processes, since an incorrect registration may affect the application of the regime or generate subsequent contingencies.
Causes for exclusion from the benefit
The employer may not make use of the benefit in certain cases. Among the main grounds for exclusion are:
- Reinstatement of an employee terminated by the same employer within 12 months of termination.
- Inclusion of the employer in REPSAL.
- Improper or abusive use of the benefit.
In these cases, the employer may lose the benefit and be obliged to regularize the corresponding amounts.
Consequences of noncompliance
If non-compliance is verified, the benefit lapses and the employer shall:
- Submit the corresponding corrective affidavits.
- Pay the contributions that were not paid during the period in which the benefit was used.
- Pay the corresponding interest.
- To face any fines that may apply.
For this reason, it is essential to check beforehand whether the employment relationship complies with the requirements of the regime and whether the internal processes allow to sustain its correct application.
Workers with social plans or programs
Employees hired under the RIFL who are receiving employment or social assistance plans or programs may continue to receive them for a maximum period of up to 12 months from the date of labor registration.
This aspect must also be considered when assessing the worker’s framework and the impact of the regime in each case.
What employers should review
Before applying the RIFL, it is advisable for companies to review:
- If they plan to incorporate personnel during 2026 or the first four months of 2027.
- If the new registrations comply with the conditions of the regime.
- If applicable, use Code 710.
- If there are applicable limits, especially for new employers.
- If there are grounds for exclusion or risk of loss of the benefit.
- Whether the recording, settlement and filing processes are adequate.
- What would be the economic impact of the reduction of employer contributions.
Each case requires an analysis of the employer’s situation, the profile of the worker reached and the correct implementation of the regime.
Our team is at your disposal to answer your questions and evaluate the scope of the regime according to each case.
Natalia López
Payroll Specialist
natalia.lopez@ar.Andersen.com
Florencia Farina
Payroll Specialist
Florencia.Farina@ar.Andersen.com