This is a general overview for planning purposes, not legal, tax or payroll advice. Labor costs depend on the employer's activity, the applicable collective agreement and the employee's situation. Your EOR partner and local counsel confirm the specifics.
How an Employer of Record works
An Employer of Record (EOR) is a local company that legally employs people on your behalf. It signs the employment contract under Argentine law, registers the employee, runs payroll in pesos, pays social security contributions and statutory benefits, and invoices you a monthly amount. You decide who to hire, what they work on and how they're managed day to day. The employee is a full employee with every right that comes with it — they're simply on the EOR's payroll instead of yours.
Why companies hire in Argentina this way
Argentina tops our analysis on seniority and English, and the EF English Proficiency Index 2025 ranks it first in Latin America. It's particularly strong for AI/ML, backend and technical leadership roles — see our country-by-country guide. For long-term teams, an employment contract with health coverage, paid vacation and a 13th salary is often what tips a senior candidate's decision, and it removes the classification risk of a long, exclusive contractor relationship.
What changed in 2026
The Labor Modernization Law (Ley 27.802), published in the Boletín Oficial on March 6, 2026, is the deepest reform of Argentine labor law in decades. The changes that matter most for a company hiring through an EOR:
- Trial period of six months as the general rule — collective agreements can extend it to eight months for companies with 6–100 employees and up to a year for companies with up to five
- No notice required to end the relationship during the trial period
- Severance base narrowed: still one month of salary per year of service, but the 13th salary (SAC) and non-monthly bonuses are excluded from the calculation base
- Severance floor and cap written into law: the base can't fall below 67% of the employee's normal monthly pay, and it remains capped at three times the average salary of the applicable collective agreement
- A new Labor Assistance Fund (FAL): a monthly employer contribution of 1% of payroll for large companies and 2.5% for SMEs, which helps finance future severance payments
- Vacation flexibility: employers and employees can agree to split vacation into periods of at least one week, taken at any time of the year
- A narrower presumption of employment for invoiced professional services paid through the banking system — relevant if you're comparing an EOR with contractors
What it really costs: beyond the gross salary
| Component | What it is | When |
|---|---|---|
| Gross salary | The agreed monthly salary, paid in pesos | Monthly |
| Employer contributions | Pension, health (obra social), family allowances and employment fund — roughly 24–26% of gross salary depending on the employer's category | Monthly |
| Workers' compensation (ART) | Mandatory occupational risk insurance, priced per employer | Monthly |
| FAL contribution | 1% (large companies) or 2.5% (SMEs) of payroll | Monthly |
| 13th salary (SAC) | An extra month of salary per year, paid in two halves | June and December |
| Paid vacation | 14, 21, 28 or 35 days depending on seniority | Yearly |
| Optional benefits | Private health plan upgrade, equipment, internet or home-office stipend | As agreed |
| EOR fee | The partner's monthly fee per employee | Monthly |
Two more items belong in the budget. First, a severance provision: after the trial period, a termination without cause costs notice (one or two months depending on seniority) plus severance as described above. Second, salary reviews: salaries are paid in pesos and adjusted more often than in the US, so agree on a review rhythm with your EOR partner from day one.
Collective agreements and "fuera de convenio"
Many employees in Argentina are covered by a collective bargaining agreement (CCT) that sets minimum salaries and conditions for an activity. Senior engineers are frequently hired outside an agreement ("fuera de convenio") because their salaries sit well above the agreement scales, but which agreement applies, if any, depends on the employer's registered activity. It also matters for the severance cap. This is a question for your EOR partner, not a detail to assume.
EOR, contractors or your own entity?
An EOR fits when
- You're building a long-term team in Argentina
- Candidates want employment, benefits and stability
- You want to start in weeks, not wait for an entity
- You'd rather not run Argentine payroll and compliance yourself
- You may open an entity later and want to test the market first
Consider something else when
- The work is short or tightly scoped → contractors or staff augmentation
- You need people across several countries at once → staff augmentation
- You'll employ dozens of people for many years → your own entity, eventually
- You need the employee to sign on behalf of a local company → your own entity
Our comparison of EOR, contractors and staff augmentation goes deeper on the trade-offs, including misclassification risk and data protection.
Large roll-outs: recruiting and employment as one program
For one or two hires, an EOR is mostly paperwork. For a roll-out of a whole team, the hard part is hiring the right people fast, in sequence, without letting offers sit while contracts are drafted. That's where recruiting and employment need to run together: one plan for profiles and start dates, offers that already reflect the EOR's employment terms, and onboarding that starts the day the contract is signed. Our 13-week hiring plan shows how to sequence it.
Final thoughts
The 2026 reform made hiring employees in Argentina more predictable: a longer trial period, a clearer severance calculation and new tools for financing terminations. For companies building long-term engineering teams there, an Employer of Record is now the most practical way to offer real employment without setting up a local entity.
IT Mates offers an Employer of Record service for large roll-outs in Argentina, run with a local EOR partner: we recruit and vet the team, and our partner employs them under Argentine law.
Sources
- Ley 27.802 — Ley de Modernización Laboral (InfoLeg)
- Boletín Oficial de la República Argentina — Ley 27.802 (March 6, 2026)
- EF English Proficiency Index 2025
Planning a team roll-out in Argentina?
Recruiting and EOR employment, in one program.
Tell us how many people you need, the profiles and the start dates. We'll plan the search, deliver vetted shortlists in 72 hours and onboard your hires through our local EOR partner.