Termination Letter Art. 159 Chile (No-Fault Termination)

Termination Letter Art. 159 Chile (Carta de Despido Artículo 159) is the mandatory written notification governed by Articles 159 and 162 of the Código del Trabajo de Chile (CT) by which an employer (empleador) communicates the termination of an individual employment contract on grounds that do not generate severance liability (causales de terminación sin indemnización), because the termination arises from circumstances unrelated to either party's misconduct. Article 159 of the Código del Trabajo enumerates six no-fault causales: No. 1 (mutuo acuerdo — mutual agreement of employer and worker); No. 2 (renuncia del trabajador — worker's resignation, addressed separately through the Carta de Renuncia Voluntaria); No. 3 (muerte del trabajador — worker's death); No. 4 (vencimiento del plazo convenido — expiry of a fixed-term contract); No. 5 (conclusión del trabajo o servicio — completion of the specific work or service for which the contract was executed); and No. 6 (caso fortuito o fuerza mayor — force majeure or act of God).

Article 162 of the Código del Trabajo establishes the formal notification requirements applicable to all terminations, including those based on Article 159 (excluding No. 2 and No. 3, which do not require employer action). The employer must deliver the carta de despido personally to the worker or send it by registered mail (carta certificada) to the worker's last known domicile within three business days (tres días hábiles) of the separation date, and must simultaneously file a copy with the Inspección del Trabajo of the corresponding jurisdiction. The Dirección del Trabajo (DT) — the Chilean government agency under the Ministerio del Trabajo y Previsión Social — processes these notifications and maintains statistics on the frequency of each termination causal.

For termination under CT Article 159 No. 4 (vencimiento del plazo convenido), the employer must have contracted the worker for a specified term — contratos de plazo fijo are authorized under Chilean law for up to two years. The Corte Suprema de Chile has established through Sala Laboral rulings that when a fixed-term contract is renewed more than once or when the worker has served more than one year consecutively under fixed-term arrangements, the contract transforms into an indefinido (open-ended) contract under CT Article 159 No. 4 inciso 2, and termination at term expiry would be treated as a CT Article 161 dismissal requiring severance.

For Article 159 No. 5 (conclusión del trabajo o servicio — project contract), the carta de despido must demonstrate that the specific work or service described in the contrato por obra o faena has actually been completed — not merely that the employer no longer requires it. Chilean construction companies, engineering firms, and mining contractors operating large-scale projects under CORFO financing or Ministerio de Obras Públicas concessions routinely use proyecto-specific contracts and must document the completion of the work with objective evidence (acta de recepción de obras, certificate of project completion) before invoking this causal.

Force majeure terminations under CT Article 159 No. 6 (caso fortuito o fuerza mayor) require the employer to demonstrate that an unforeseeable, unavoidable external event — such as a natural disaster (earthquakes are particularly relevant in Chile given its location on the Anillo de Fuego del Pacífico — Pacific Ring of Fire), flood, fire, or pandemic — made the continuation of the specific work impossible. The Juzgados de Letras del Trabajo have strict standards for force majeure: general economic downturns, competitive market changes, or business losses do not qualify — these situations are addressed under CT Article 161 (necesidades de la empresa). The CT Article 159 No. 6 causal requires true impossibility, not mere inconvenience.

A Termination Letter Art. 159 Chile is required by Código del Trabajo Article 162 whenever an employer terminates an employment contract on one of the no-fault grounds enumerated in CT Article 159, and must be issued in writing within three business days of the separation date to comply with DT notification requirements.

The carta de despido is needed when a fixed-term contract (contrato a plazo fijo under CT Article 159 No. 4) reaches its agreed end date — a scenario common in seasonal industries such as salmon farming (salmonicultura) in the Región de Los Lagos and Aysén, fruit harvesting (fruta de exportación) in the Región de Valparaíso and Región del Libertador Bernardo O'Higgins, tourism (temporada alta) in Punta Arenas, Puerto Natales, and San Pedro de Atacama, and retail (temporada navideña y de verano) at major chains like Falabella, Ripley, and Paris.

The letter is needed when a project-based contract (contrato por obra o faena under CT Article 159 No. 5) concludes upon completion of the specific work — essential in the construction sector (empresas constructoras registered with the Cámara Chilena de la Construcción — CChC), mining operations (faenas mineras at operations like Escondida, Chuquicamata, or El Teniente), and infrastructure projects awarded by the Ministerio de Obras Públicas or the Ministerio de Vivienda y Urbanismo (MINVU) through public procurement under Ley N° 19.886.

A termination letter under CT Article 159 No. 6 is needed following a force majeure event — natural disasters (Chile has one of the world's highest seismic activities, governed by emergency protocols of the Oficina Nacional de Emergencia del Ministerio del Interior — ONEMI, now SENAPRED), fires (incendios forestales in regions like La Araucanía and Biobío), or public health emergencies (as experienced during the COVID-19 pandemic declared under DS N° 104/2020 of the Ministerio del Interior). In force majeure cases, the employer must apply to the Juzgado de Letras del Trabajo for authorization before invoking CT Article 159 No. 6 for terminations that would otherwise require severance.

For mutual agreement terminations (mutuo acuerdo under CT Article 159 No. 1), the termination letter documents the agreed separation when both employer and worker have negotiated the terms — often involving negotiated severance exceeding the statutory minimum, a non-disparagement agreement, and outplacement services. Employers conducting voluntary workforce reduction programs (programas de retiro voluntario) at organizations such as BancoEstado, ENAMI, or Corporación Nacional del Cobre de Chile (Codelco) use CT Article 159 No. 1 cartas de despido combined with finiquitos containing agreed enhanced severance.

A valid Termination Letter Art. 159 Chile under Código del Trabajo Articles 159 and 162 must contain the following essential elements to comply with DT notification requirements and protect the employer from unjust dismissal claims:

Party Identification: Full legal name or razón social of the employer with RUT (Servicio de Impuestos Internos — SII), registered domicile, and the authorizing representative's name and title. Full legal name, RUT, cédula de identidad, position (cargo), and domicile of the worker. For corporate employers (SpA, SRL, S.A., EIRL), include the legal entity type.

Employment Relationship Details: The start date of the employment relationship (fecha de inicio), the type of contract (indefinido, plazo fijo with start and end dates, or por obra o faena with description of the specific work), and the worker's last remuneration (última remuneración mensual) including all habitual components under CT Article 172.

Specific Causal Under CT Article 159: Express citation of CT Article 159 and the specific numeral invoked — No. 1 (mutuo acuerdo), No. 3 (muerte), No. 4 (vencimiento del plazo), No. 5 (conclusión del trabajo), or No. 6 (caso fortuito o fuerza mayor). For No. 4, attach a copy of the original fixed-term contract showing the agreed end date. For No. 5, attach documentation evidencing completion of the work (acta de recepción, certificate of project completion). For No. 6, describe the specific force majeure event with date, nature, and effect on the employment relationship, and reference any SENAPRED (ONEMI) declarations or judicial authorization obtained.

Effective Date of Termination: The specific date on which the employment ceases. For CT Article 159 No. 4 terminations, this is the contract expiry date. For No. 5, this is the documented completion date. For No. 6, this may be the date of the force majeure event.

Proporcional Benefits and Finiquito: A statement acknowledging the worker's entitlement to proportional benefits: feriado proporcional (CT Article 73), gratificación proporcional (CT Articles 47–52), and any outstanding remuneration. A request for the worker to appear before a ministro de fe (Notario Público, Inspección del Trabajo inspector, or Juzgado de Letras del Trabajo secretary) to ratify the finiquito under CT Article 177, specifying the date, time, and location for ratification.

Social Security Compliance Declaration (Ley Bustos-Seguel): Confirmation under CT Article 162 inciso 5 that all mandatory social security contributions (AFP contributions to AFP Habitat, AFP Provida, AFP Capital, AFP Cuprum, AFP Modelo, or AFP Uno regulated by the Superintendencia de Pensiones; FONASA or ISAPRE health contributions; AFC Chile unemployment insurance under Ley N° 19.728; and occupational accident insurance under Ley N° 16.744) are current through the termination date. Non-compliance renders the termination legally void (nulidad del despido) regardless of the Article 159 causal invoked.

Delivery and DT Filing Confirmation: A statement that the carta de despido will be delivered personally or by registered mail (carta certificada) to the worker's last known domicile and that a copy will be filed with the Inspección del Trabajo of the corresponding jurisdiction within three business days of the separation date, as required by CT Article 162.

Right to Challenge (Información de Derechos): Notification that the worker has sixty business days (sesenta días hábiles) under CT Article 168 to file a judicial claim challenging the validity of the termination causal before the Juzgado de Letras del Trabajo, with a prior mandatory mediation stage before the Inspección del Trabajo.

Forms-legal.com provides this Termination Letter Art. 159 Chile template as a reference for employers complying with Código del Trabajo notification requirements. The financial consequences of invoking an incorrect causal — including involuntary transformation of a fixed-term contract into an indefinite contract, or failed force majeure defences — can be substantial, and employers should consult an abogado laboralista before issuing this letter. Los usuarios de forms-legal.com pueden descargar este documento de forma gratuita en formato PDF o DOCX, completar los campos del formulario guiado y obtener un documento listo para firma.