Milei’s labor reform, approved in Congress after its brakes in Justice

The Chamber of Deputies of Argentina approved this Tuesday the labor reform proposed by the Executive of Javier Milei in the Law Bases and Starting Points for the Freedom of Argentines, considered essential by the president to undertake his program of deregulation of the economy.

Under the title of “labor modernization”, the deputies approved the labor reform requested by the Milei Executive, which initially integrated the decree of necessity and urgency (DNU 70/23), promulgated last December and still in force despite its rejection in the Senate, and was stopped by Justice at the request of the unions.

Now lightened to be able to achieve its approval in the chamber, the labor reform passed the filter of Deputies.

After approving the content of the law in general after more than 20 hours of debate, the legislators began voting chapter by chapter on what is known as the ‘omnibus law’, the star project of the Milei Executive.

The so-called labor reform modifies the employment contract law, by extending the trial period from three to six months and allows collective labor agreements to extend it up to eight months and up to one year, depending on the size of the company, which allows saves severance pay.

A controversial chapter was the creation of a “severance fund”, which allows compensation for dismissal to be replaced by a severance system, which can be private, to cover payment for dismissal without cause.

Another chapter that generated debate was the one that allows “independent workers” to have up to five “independent workers” to carry out a productive enterprise, which implies an “autonomous relationship, without there being a link of dependency between them.”

It also creates a job bank run by union associations to propose to employers a list of personnel to carry out temporary tasks.

The majority of deputies voted in favor of the six chapters of the labor modernization title which, in its beginning, tries to expedite the registration of registered workers and alleviates aggravated compensation for unregistered workers.

The law also allows the reduction of pregnancy leave prior to childbirth to ten days and the accumulation of the remaining 80 days after birth and increases the compensation for a dismissal motivated by a discriminatory act.

The deputies who voted against denounced that the reform is a “removal of rights” from workers, will imply “job insecurity” and will not eliminate litigation in Justice, but will increase it because they consider that several of its measures are unconstitutional.

The ‘omnibus law’ – due to the number of articles (although today they represent a third of the original project, which exceeded 600) and the magnitude of the reforms it proposes – is the tool with which the Milei Executive intends to deregulate the economy and reduce the weight of the State.

This Tuesday, the delegation of powers to the Executive for one year was also approved by virtue of a public emergency in administrative, economic, financial and energy matters.

After the parliamentary failure in February, the ruling party opened intense negotiations with the so-called ‘dialogue’ opposition to bring positions closer together with a view to the approval of this text.