Just to clarify my point, cos It might have sounded a little bit ambiguous: I said that it was not true that in Argentina employees don't sign contracts, because I was an employee and I signed a contract, and so did most of the people I know that worked at major companies.
The main purpose of those contracts are to stipulate certain conditions so the employer can be sure the employee understood those conditions and agreed, so there shouldn't be any problem of misunderstanding (something that could normally happen if the agreement is just spoken word) and those contracts are valid proof of an agreement unless they violate the law. Let's say I sign a contract that says I will not have vacations, it will be worth absolutely nothing in case of a potential lawsuit.
Sooo... is it an obligation to sign a contract to be legally employed? The answer is NO. Guillo is totally right in her arguments that an employee here has a huge number of ways to prove that he worked for a company.
When you work, you are registered in the ANSES, you get health insurance, you sign a receipt everytime you get paid and keep a copy of that receipt, you pay income taxes, etc.
If in some way you happen to find out that you have been employed by John's "Evil Capitalist Employer" (and he is right! there's plenty of those in this country), well.. let's say that if you are the employee you have 90% of the lawsuit already won. You'll just need a good number of witnesses, make a declaration stating duties you had to do, prove knowledge of internal aspects of the company that only someone who actually worked there would have known, and if you ever happen to have a copy of a receipt of your salary (I don't think the evil capitalist would be that stupid, but it can happen!) then you can sit comfortably in your chair cos you have the lawsuit in your pocket.
Aaaandd the amount of money the evil capitalist will have to pay won't be small at all, so he will think it twice before trying to take advantage of an employee in the "land of Perón". (No I am not "Peronista", thank God i'm waaay far from being one).
Now my opinion: Does this system work? Yes, it does. Is it good for employers and employees? Well, my family owns a mid-sized business, with around 100 employees, but I've also been an employee in other companies, so I can have both points of view.
It's fairly good for an employee because the law is absolutely impartial and tends to favor them in 90% of the cases. But... in the long term, and thinking macroeconomically, it's not such a good law. Why? Because an employer will think 1.000.000.000.000 times before hiring a new employee. My dad always said "hiring a new employee is hiring a new problem"... why?? because employees take advantage of the benefits of the law in a big number of unethical ways. i.e.: an employee wants to quit.... so deliberately does a terrible job, shows attitude to his boss, causes trouble, etc etc. And it is almost impossible to fire him putting that as a cause of termination. In other words, he will get fired "without a cause" and thus will be paid a considerable ammount of money for compensation. So in this country it's better to do your job terribly for a couple of months and cause some trouble, than simply quitting.
The result of this law?? The terrible attention customers get, lots of things not working properly, businesses closing... and also unemployement, cos employers are reluctant to hire new employees unless it's extremely necessary.
I stated multiple times that the letters function as an outline of job title, salary, start date, responsibilities, etc. At no time did I say that the letter asked them to cede their legal rights. Nor did I say it would supercede national law. A work contract can't supercede employment law. That's so obvious, I didn't realize it was necessary to spell it out. Stating that this agreement is the sole contract (as we do) is to prevent an employee from claiming he or she was promised x, y or z and didn't get it. 
