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Judicial suspension hits core of Milei’s labor reform and reignites dispute between government and unions in Argentina, with direct impact on working hours, dismissals, and collective rights.
The Labor Court of Argentina has provisionally suspended 82 of the 218 articles of the Labor Modernization Law, one of the main bets of Javier Milei’s government to relax hiring, working hours, and dismissal rules in the country.
The decision was signed this Monday (30) by Judge Raúl Horacio Ojeda of the National Labor Court No. 63, following an action presented by the General Confederation of Labor, the CGT, and is valid until the merits are judged.
Judicial decision blocks central points of the reform
According to information from the G1 portal, with the precautionary measure, central excerpts of the reform approved by the Argentine Congress on February 27 and enacted on March 5 are immediately rendered ineffective, in a move that opens a new front of political wear for the Casa Rosada.
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The magistrate understood that there are “serious and grave” indications of unconstitutionality in points of the law and pointed out the risk of immediate harm if the changes were to take effect before the definitive analysis of the case.
Among the blocked provisions is one that authorized extending the daily working hours to up to 12 hours with time compensation, without mandatory payment of overtime in all cases, in addition to the creation of a time bank by individual agreement.
Articles that affected the calculation of severance pay were also suspended, including removing from the owed amount items such as the 13th salary and non-monthly bonuses, and rules that allowed for installment payments arising from judgments.
Strike, unions, and collective negotiation enter the center of the dispute
The decision also affects the rules that restricted the right to strike and imposed minimum operation in certain sectors during stoppages, a sensitive topic in Argentine union tradition and in the historical clash between Peronism and liberal agendas.
Similarly, articles that affected collective negotiation, reduced protection for union activities, and altered the role of worker representatives within companies were also impacted, points that the CGT had been classifying as an attack on union freedom.
Changes in contracts and links are also suspended
Another block affected involves hiring methods and the recognition of employment relationships, an area particularly sensitive amid the rise of app-based work and outsourcing.
Measures that limited the liability of companies when resorting to outsourced labor, made it difficult to classify workers as employees, and expanded spaces for classifications outside the traditional labor law regime were suspended.
Additionally, the precautionary measure halted the revocation of the telework law, froze the mandatory fragmentation of vacations, and affected the so-called Worker Assistance Fund, a mechanism designed to partially replace the classic compensation system.
According to reports published by the Argentine press, the judge considered that this fund might not provide sufficient protection to the employee and could still have significant effects on the social security system, which reinforced the urgency argument to halt the application of the new norm.
Government promises to appeal and unions celebrate decision
In the decision, Ojeda stated that granting the precautionary measure aimed to preserve the judicial discussion “as quickly as possible and in social peace,” while the process continues for substantive analysis in labor courts.
In another formulation reproduced by the case coverage, the judge maintained that the temporary suspension was justified to avoid irreparable harm if the law were later declared incompatible with the Argentine Constitution and with international commitments made by the country in the labor area.
The Milei government reacted through the Ministry of Human Capital and announced that it will appeal, with the support of the Treasury Attorney’s Office, to try to restore the full validity of the reform.
In a statement cited by the press, the ministry stated that the law was sanctioned by a wide majority in Congress and classified it as a central tool to stimulate formal employment, increase competitiveness, and reinforce legal security, while rejecting attempts to block changes deemed necessary to address unemployment and stagnation.
On the other side, the CGT celebrated the provisional result and stated that the so-called labor modernization represents a reduction in work protection, worsening employment conditions, and weakening of union action.
The confederation argues that several provisions approved by Congress collide with constitutional principles, such as the non-waivability of rights, and with international treaties incorporated into the Argentine legal system, a line of reasoning that was at least partially accepted by the magistrate in this initial phase of the process.
Political clash intensifies and keeps reform at the center of the debate
The judicial setback deepens a dispute that has surrounded the reform since its legislative process, marked by protests in the streets, union resistance, and strong polarization between government and opposition.
For the Argentine presidential palace, the flexibilization is presented as a solution for a stagnant labor market and for costs considered excessive by companies; for unions and opposition sectors, however, the package reduces historical guarantees and shifts the legal balance in favor of the employer.
In practice, the precautionary measure does not definitively overturn the law but freezes precisely the most sensitive core of the reform until the judiciary decides whether the questioned articles can remain in effect or not.
Until then, the conflict is expected to remain at the center of the Argentine political and economic agenda, with direct impact on the debate regarding the scope of Milei’s reforms, the reaction power of the union centers, and the role of the judiciary in containing changes approved by Congress.
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