Less than a year after its enactment, a federal district court has declared null and void Puerto Rico Act 41-2022, a law that rolled back parts of the 2017 employment law reform. Financial Oversight and Management Board for Puerto Rico v. Pierluisi Urrutia, No. 17 BK 3283-LTS (D. P.R. March 3, 2023). Accordingly, the 2017 Puerto Rico employment law reform is back in full force.
In June 2022, Puerto Rico Governor Pedro Pierluisi signed Act 41-2022, which introduced changes to the statutory probationary period, vacation and sick leave accrual, and the way the annual Christmas Bonus is accumulated, among other requirements. However, the Financial Oversight and Management Board for Puerto Rico (the entity created by Congress to supervise the finances of the Government of Puerto Rico) commenced litigation against the government, seeking to nullify Act 41-2022 as a violation of the PROMESA Act (a federal law passed in 2016 to allow Puerto Rico to restructure its public debt).
The federal court overseeing the Puerto Rico bankruptcy-like procedures ruled Act 41-2022 violated federal law and declared it null and void ab initio. The court went as far as to permanently enjoin the governor and any other individuals from taking any steps to help private parties enforce Act 41-2022.
The 2017 law provides automatic probationary periods of nine months for non-exempt employees and 12 months for white-collar employees.
For employees hired after...
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