Calculation of social benefits in bolivars and foreign currency according to decision No. 306 of the Social Cassation Chamber of the Supreme Court of Justice

Calculation of social benefits in bolivars and foreign currency according to decision No. 306 of the Social Cassation Chamber of the Supreme Court of Justice

Decision No. 306, issued on July 26, 2024 by the Social Cassation Chamber of the Supreme Court of Justice, pertains to the calculation of social benefits.

According to the decision, the Court identified an error in a prior decision regarding the methodology used by the lower court, specifically in relation to the methods outlined in Article 142 of the Labor Law. The Court reiterates the judicial precedent on this matter and provides clarification on how benefits should be calculated when salaries are paid in foreign currency or bolivars.

For salaries paid in bolivars, due to inflation and currency conversion, benefits must be calculated according to the system stipulated in Article 142, paragraph “c” of the Labor Law. This method, colloquially known as “recalculation” or “retroactive”, involves calculating social benefits based on thirty days for each year of service or fraction of more than six months, using the last salary of the employment relationship as the basis.

Regarding salaries paid in foreign currency, it might be more appropriate to apply the system defined in paragraphs “a” and “b” of the same article. These paragraphs establish 60 days per year plus additional days, as opposed to the 30 days per year considered in paragraph “c.” Under paragraphs “a” and “b,” each employee must be paid the equivalent of fifteen days for each quarter, based on the last salary earned in the quarter in effect., as a guarantee of social benefits. The right to this deposit is acquired at the beginning of the quarter. After the first year of service, each employee must be paid two days of salary for each year, cumulative up to thirty days of salary.