The government led by President Javier Milei has officially introduced a labour reform bill in Argentina’s Congress, starting a legislative fight over the future of worker protections in the country. This proposed legislation is a key part of Milei’s sweeping austerity and deregulation plan. It aims to change the country’s employment landscape dramatically. While the government presents these changes as essential for boosting job creation and attracting investment, trade unions, Peronist factions and leftist parties have quickly condemned it, viewing it as a major rollback of hard-earned labour rights.
The 79-page bill, signed by President Milei and his ministers of economy and labour, seeks to change decades of labour law traditions. Its main goals are to cut labour costs for employers, reduce the number of lawsuits over dismissals and offer what it describes as “flexibility” in hiring and employment practices. The government argues that current rules hinder formal job creation and discourage investment. Critics, however, state that the reforms shift power away from employees towards employers, jeopardizing job security and undermining collective bargaining.
One controversial part of the reform focuses on changes to severance pay for dismissals without cause. Although the current rule of one month’s salary for each year worked stays in place, the bill introduces new caps that would limit the maximum payouts. More importantly, it includes a legal clause that would prevent dismissed workers from seeking additional compensation in court if they accept the calculated severance. Labour lawyers against the bill argue this will essentially force workers to accept settlements that could undervalue their losses, removing their legal options.
The proposal also brings new ideas to Argentine labour law. One provision would allow workers to be paid in foreign currency, Argentine pesos or even through benefits like food or merchandise. Critics warn this could create unpredictable pay and complicate how wages are evaluated against inflation.
Another significant change is the establishment of a “time bank” system. This would let employers require employees to work beyond their normal hours, banking that extra time for compensatory time off to be taken later. Importantly, these banked hours would not count as overtime, so they wouldn’t be eligible for the higher pay that current overtime laws require. Opponents see this as a direct assault on extra pay for long hours and a way for employers to bypass overtime pay.
The reform directly targets the structure and influence of trade unions, which have been a strong presence in Argentine politics. It proposes that collective bargaining agreements end completely on their expiration date, instead of remaining valid while new terms are negotiated. Unions claim this takes away an important safeguard that prevents workers from being without a contract during often lengthy negotiation periods. Additionally, the bill states that company-level agreements would have priority over industry-wide ones, even if the company agreements offer worse wages or conditions. Analysts suggest this could weaken worker unity and lead to a “race to the bottom” among sectors.
Other changes include adjustments to vacation rules, allowing employers to schedule mandatory leave outside the usual summer period with 30 days’ notice, and allowing employees to split their annual leave into one-week blocks. While these adjustments are presented as offering flexibility, unions worry they may disrupt family time and traditional rest periods.
A specific change affecting a vulnerable group extends the probation period for domestic workers, a sector mainly made up of women, from one month to six. This significantly increases the time during which these workers can be fired without cause or severance, a move condemned by women’s rights and labour groups as disproportionately affecting an already vulnerable part of the workforce.
The bill’s introduction has prompted a quick and united response from the political opposition and labour movement. The General Confederation of Labour (CGT), the country’s main labour union, has denounced the proposal as “regressive” and a direct “attack on workers’ dignity.” In a concrete reaction, the CGT has called for a major protest march to gather at the historic Plaza de Mayo, the traditional site for social and political demonstrations in Buenos Aires.
Political groups aligned with Peronism, which has historically supported labour rights in Argentina, have promised to fight against the bill in Congress and the streets. At the same time, the left-wing coalition Frente de Izquierda y los Trabajadores has urged broader mobilization, calling for a united front against the reforms. The coalition has actively promoted calls for protests on social media, indicating a strategy of combining efforts in Parliament with mass mobilization.
“The so-called ‘reform’ is not about creating quality jobs,” stated a union leader from the CGT. “It is about making hiring and firing cheap and easy, reducing workers to mere costs on a spreadsheet. It seeks to dismantle protections that prevent exploitation and guarantee dignity.” Economists sympathetic to the unions cite international studies suggesting that too much labour flexibility can lead to greater insecurity and stagnant wages without guaranteeing net job growth.
The labour reform bill represents one of the most significant political battles of President Milei’s early administration. It tests the limits of his authority and the resilience of Argentina’s labour institutions. The government insists that shock therapy and deregulation are the only ways to stabilize the troubled economy and break cycles of inflation and deficit.
However, the opposition sees the debate as a crucial defense of social rights against a libertarian model that they believe sacrifices worker welfare for market ideology. As the bill starts its legislative path, the upcoming weeks will likely be filled with intense debates in Congress, alongside substantial social unrest and public demonstrations. This sets the stage for a drawn-out conflict over the future of the Argentine economy and society. The outcome will likely depend not only on legislative numbers but also on the opposition’s ability to turn popular discontent into ongoing political pressure.