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regime without wage or price controls (EIU, 2004). Universal Services may invest in Argentina without registration or prior government approval on the same terms as investors domiciled in Argentina. There are only a few exceptions sectors: real estate in border areas, air transportation, shipbuilding, nuclear energy, uranium mining, and fishing (EIU, 2005). None of the exceptions applies to Universal Services. Acquisition or merger are acceptable in Argentina and face the same regulation. In general, taxes are assessed on consumption, imports, assets, property, and payroll (social security and related benefits) (EIU, 2006).
Argentine workers are more highly educated and better paid, on average, than labor in other Latin American countries. Economic reforms and the introduction of laborsaving technologies have increased demand for highly skilled workers and may cause a problem in finding skill local candidates for staffing. Some other considerations are recent social changes and other taxes that significantly add to the cost of Argentine labor (EIU, 2006). High severance payment requirements and strict rules on collective bargaining also contribute to a tight labor market.
The Argentine Labor Code has traditionally been a serious disincentive in the hiring of new employees. A labor reform initiative enacted in May 2000 was expected to address some of these rigidities over time by increasing collective bargaining flexibility, extending trail employment periods, and lowering payroll taxes for new permanent hires. However, incomplete implementation of the new legislation leaves in many of the early disincentives to new hiring (EIU, 2006). Key legal reforms for Universal Services to consider related to staffing strategy are the following as noted from the Economist Intelligence Unit information on Argentina:
• Ley Nacional de Empieo 24013 /91. This law created unemployment insurance; allowed some positions to be filled by temporary...