Argentina Approves Milei’s Labor Reforms Amidst Protests

BUENOS AIRES – Argentina’s Senate approved a labor reform package backed by President Javier Milei on Saturday, February 29, 2026, granting it final clearance to become law and marking a significant legislative win for the libertarian leader. The reforms, passed with 42 votes in favor, 28 against and two abstentions, aim to spur investment and create formal jobs, according to the Milei administration. However, labor unions contend the changes weaken worker protections, including the right to strike.

Key Provisions of the Labor Reform

The approved reforms introduce several key changes to Argentina’s labor laws, including:

• Relaxed Hiring Rules: The legislation eases restrictions on hiring and firing employees.
• Extended Workdays: The standard workday can now be extended from eight to 12 hours.
• Foreign Currency Payments: Salaries can be paid in foreign currency.
• Severance Fund: A new employer-financed severance fund will be established, funded by contributions previously allocated to the national pension system.
• Limits on Striking: New limits are placed on the right to strike, requiring essential services to maintain minimum operations during perform stoppages.

Political and Economic Context

Passage of the bill is viewed by analysts as a signal that President Milei has the political backing to advance his broader free market agenda [Reuters]. Since taking office, Milei has focused on stabilizing the exchange rate and curbing inflation, with monthly price increases falling from double digits to 2.9% in January 2026, earning praise from the International Monetary Fund [AP News].

Union Opposition and Protests

The labor reforms have faced strong opposition from labor unions, who have organized protests, including a nationwide strike, against the changes. Unions argue the new legislation will erode worker rights and protections [Al Jazeera]. Recent protests outside the National Congress have resulted in clashes between police and demonstrators [DW].

Impact on Pension System

One of the most contentious aspects of the reform is the establishment of the employer-financed severance fund. Opposition lawmakers express concern that this change could negatively impact the resources of the national pension system [AP News].

Further Legislative Priorities

The labor reform is one of several legislative priorities for the Milei administration. Lawmakers are also considering changes to the law protecting Andean glaciers, a move the government claims will unlock mining investment, while environmental groups strongly oppose it [AP News].