Anatomy of the petition in a labor lawsuit

2Unjustified dismissal: the declaration

The first claim doesn't ask for money. It asks the court to declare the dismissal unjustified, improper, or without cause. It is a declaratory claim and is the key to almost everything else: without that declaration there is no surcharge.

The deadline to challenge a dismissal is 60 business days counted from the termination date (Article 168 of the Código del Trabajo). The deadline is suspended while the worker files a claim with the Labor Inspectorate within it, and resumes once that step ends. The same article sets an absolute limit: the court can never be approached later than 90 business days from the termination date.

The consequence of the declaration is set out in Article 168 itself. Once the dismissal is declared unjustified, the contract is deemed to have ended under one of the grounds in Article 161 — business needs ("necesidades de la empresa") — and the severance-by-years-of-service is due, increased by the applicable percentage.

3The Article 168 surcharge

The surcharge is a percentage applied to the severance-by-years-of-service. Not to the total amount claimed, nor to the payment in lieu of notice. The percentage depends on the ground the employer invoked when dismissing the worker, and the four brackets are mutually exclusive.

Two frequent errors when reviewing an opposing party's petition: a percentage that does not match the ground stated in the dismissal letter, and two percentages added together in the same claim. Neither survives a reading of the article.

Indirect dismissal (constructive dismissal, "auto-despido") has its own table. When it is the worker who ends the contract by imputing an Article 160 ground to the employer, Article 171 sets a 50% surcharge for No. 7 and up to 80% for No. 1 and No. 5. Neither the 30% nor the 100% brackets of Article 168 exist there.

4Severance by years of service

This is the economic core of the lawsuit. It is governed by Article 163 of the Código del Trabajo and applies when the contract lasted one year or more.

• Formula. Thirty days of the last monthly wage for each year of service and any fraction exceeding six months, worked continuously for the same employer.
• Cap. A maximum of 330 days of wages, i.e. eleven years. Seniority beyond that limit does not increase the amount, unless an exceptional regime applies that must be checked against the worker's specific situation.

A fraction exceeding six months counts as a full year. A relationship of four years and seven months pays five years. One of four years and five months pays four. The difference between the two cases is one full monthly wage, and it hinges on a termination date that is frequently disputed.

Severance-by-years-of-service and lost profits (lucro cesante) don't coexist. Lost profits is the claim proper to the early termination of a fixed-term or project-based contract: it asks for the wages the worker would have received through the agreed end date. Asking for both over the same period is asking for the same thing twice.

5Payment in lieu of notice

When the employer ends the contract for business needs or by advance notice ("desahucio"), it must give thirty days' advance notice. It can replace that notice by paying an indemnity equal to the last monthly wage (Article 161, second paragraph, and Article 162, fourth paragraph, of the Código del Trabajo).

If notice was given on time and properly, the claim doesn't apply. If it wasn't given and wasn't paid, the worker collects it. It is a single monthly wage, calculated on the same basis under Article 172 explained below, and it is compatible with both the severance-by-years-of-service and the surcharge.

It also applies in an indirect dismissal: Article 171 expressly refers to Article 162, fourth paragraph.

6The calculation base and the 90 UF cap

Almost every severance payment for termination of contract is calculated on the same base. It is defined by Article 172 of the Código del Trabajo and is the source of half the calculation gaps between a complaint and its answer.

What is included

The last monthly wage, including any amount the worker receives for rendering their services, including the contributions owed by the worker and any benefits or goods valued in money.

What is excluded

The statutory family allowance, overtime payments, and benefits or allowances granted sporadically or once a year, such as bonuses ("gratificaciones") and holiday bonuses ("aguinaldos").

Variable wages

The average of what was earned over the last three calendar months is used.

Cap

The base cannot exceed 90 unidades de fomento (UF). This caps the monthly base, not the total amount of the award.

It's worth keeping in mind what this cap does not reach. Vacation pay is calculated on a different base and with no UF cap, as shown next.

7Proportional vacation pay

A worker who leaves the company before completing the year that gives the right to paid vacation receives an indemnity for that period, equal to full wages calculated proportionally to the time elapsed between their hiring (or last vacation) and the end of the contract. It is set out in Article 73 of the Código del Trabajo.

The base is not the one in Article 172, but the full wage ('remuneración íntegra") of Article 71: the base salary for a worker with fixed pay, and the average of the last three months worked for a worker with variable pay. The 90 UF cap does not apply here.

Two clarifications that shape the calculation:

• Annual vacation is fifteen business days with full pay (Article 67). It is counted in business days, not running days.
• Vacation can be accrued by agreement, but only up to two consecutive periods (Article 70). Claiming more than that exceeds what the rule allows to accrue.

For long-tenured workers, pending and proportional vacation are supplemented by the progressive vacation of Article 68: one additional day for every three years worked for the same employer, for a worker who has ten years of work, continuous or not, with one or more employers. Of those ten years, only up to ten years with prior employers can be counted.

8Nullity of the dismissal

This is the claim that moves the most money and generates the most dispute. Article 162 of the Código del Trabajo requires the employer to inform the worker in writing of the payment status of their pension contributions ("cotizaciones previsionales") at the time of dismissal. If those contributions have not been fully paid, the dismissal does not have the effect of ending the employment contract. In practice this is known by the surname of the lawmaker who drove the reform that introduced it ("Ley Bustos").

The mechanism has three pieces, in the fifth, sixth and seventh paragraphs of Article 162:

1. 1.The sanction. The dismissal does not end the contract while the pension debt remains outstanding.
2. 2.Cure (convalidación). The employer can cure the dismissal by paying the overdue contributions and notifying the worker by certified mail, accompanied by documentation issued by the pension institutions.
3. 3.The economic effect. The employer must pay the worker the wages and other benefits set out in the contract for the period between the dismissal date and the date that notice is sent or delivered.

Two things that are often confused. Payment of the overdue contributions goes to the pension institutions; the nullity wages are paid to the worker. They are distinct and cumulative claims.

The deadline is not the 60 days of Article 168 either. The action to claim this nullity expires (prescribe) after six months counted from the suspension of services (Article 510). That deadline is for filing suit; it is not a cap on the amount that accrues.

9Protection of fundamental rights (tutela)

Tutela is not just another indemnity within a dismissal lawsuit: it is its own procedure, governed by Article 485 and following of the Código del Trabajo, for when the harm affects a worker's fundamental rights. And it changes the entire petition.

On the occasion of dismissal

If the violation occurs on the occasion of dismissal, Article 489 governs. The claim must be filed within 60 days from the termination date, with the same suspension for an administrative claim that applies to Article 168. Worth not confusing the two: unlike Article 168, Article 489 does not qualify that period as "business days," so it is not counted the same way. If the claim is upheld, the judge orders payment of the indemnities under Articles 162 and 163, the Article 168 surcharge when it applies, and an additional indemnity the judge sets, not less than six nor more than eleven monthly wages.

The unjustified-dismissal claim is exercised in the alternative (subsidiary), not in parallel. A petition that requests both as independent claims is poorly drafted.

During an active employment relationship

If the violation occurs while the relationship is still active, Article 495 applies: the judgment orders the immediate end of the unlawful conduct, the specific remedial measures — including any indemnities that apply — and measures aimed at restoring the situation to what it was immediately before the violation. The six-to-eleven-wage range belongs to Article 489 and does not carry over here.

Reinstatement is not the default rule either. Article 489 offers it as an option only when the judge declares the dismissal discriminatory, in violation of Article 2, fourth paragraph, and classifies it as serious in a reasoned ruling.

10Adjustments and interest

This is the line that gets copy-pasted without a second look, and it is actually two different regimes.

• Wages and unpaid benefits. Article 63 of the Código del Trabajo orders that amounts the employer owes for wages be adjusted according to the change in the consumer price index, and accrue the maximum interest allowed for adjustable obligations.
• Severance for termination of contract. Article 173 sets its own adjustment-and-interest regime from the end of the contract until actual payment.

The distinction matters because the starting dates differ: when each unpaid wage becomes due, in one case; the end of the contract, in the other. Over a long case, the difference stops being minor.

11The petition as data

Everything above lives, today, inside a PDF. The complaint enters the case file, someone reads it, jots the total amount on a spreadsheet, and the rest is lost. The spreadsheet says "$38,400,000." It does not say that of that figure, 22 million is the nullity claim — a claim that switches off the day the employer cures it — and that another 4 million depends on a surcharge that requires a prior declaration from the court.

A petition structured as data, with one row per claim, allows three things a PDF doesn't. Provisioning by line item instead of by total, because each line carries a different probability. Auditing the opposing party's petition against the rule: if the surcharge claimed is 80% and the dismissal letter invoked business needs, the number doesn't match. And comparing portfolios, because only once claims are fields can you ask which matters close high and which are worth litigating.

None of this requires new technology. It requires reading the complaint once and saving what was read as structure, instead of saving it as a file. That is exactly the part of the work that gets redone today every time someone opens the case.