Argentina's Labor Reform: Senate Approval Likely, But Social Unrest and Legal Battles Loom

7 predicted events · 5 source articles analyzed · Model: claude-sonnet-4-5-20250929

# Argentina's Labor Reform: What Comes Next After Congressional Passage

Current Situation

Argentina stands at a pivotal moment as President Javier Milei's controversial labor reform bill moves closer to becoming law. After a marathon 12-hour session, the Chamber of Deputies narrowly approved the legislation by a vote of 135-115 in the early hours of February 20, 2026, according to Article 1. This victory came despite a massive 24-hour general strike that brought Buenos Aires to a near-standstill, with flights canceled, public transport halted, and widespread business closures reported in Articles 4 and 5. The reform bill fundamentally restructures Argentina's labor market by extending workdays from 8 to 12 hours, limiting severance pay and collective bargaining, easing firing restrictions, and reducing unions' bargaining power. As Article 3 notes, these changes target worker protections that have been "entrenched in Argentina since the 1940s," making this one of the most significant rollbacks of labor rights in the country's modern history.

Key Trends and Signals

Several critical patterns emerge from the recent developments: **Narrow Parliamentary Support**: The 135-115 vote in the Chamber of Deputies reveals a deeply divided Congress. Milei's La Libertad Avanza party required support from center-right allies to pass the bill, suggesting fragile coalition dynamics. **Escalating Union Resistance**: Article 2 indicates this was the fourth general strike of Milei's presidency, demonstrating sustained and organized opposition. The General Confederation of Labor (CGT), one of Argentina's largest unions, has vowed to fight the reforms "in the streets, in Congress, in the courts and in every workplace," as reported in Article 5. **Economic Pressure Points**: Nearly 40% of Argentina's workers lack formal employment contracts (Article 3), creating a volatile situation where both sides claim their approach will address informal employment—unions argue the bill will worsen it, while the government contends it will reduce under-the-table work. **Street-Level Tensions**: Articles 4 and 5 document clashes between protesters and police, blocked roads into Buenos Aires, and widespread civil disruption, indicating that opposition extends beyond union leadership to grassroots movements.

Predictions: What Happens Next

### 1. Senate Approval Within Two Weeks **High Confidence** The bill will return to the Senate for final approval of the Chamber's modifications and is "expected to become law before the end of the month," according to Article 1. Given that the Senate already passed an earlier version last week, and Milei's coalition maintains control, final passage appears virtually certain. The Senate is unlikely to significantly alter the bill, as doing so would risk the fragile coalition that supports it. ### 2. Immediate Legal Challenges from Unions **High Confidence** The CGT's explicit promise to fight the reforms "in the courts" (Article 5) signals imminent constitutional challenges. Labor unions will likely argue that the reforms violate international labor conventions to which Argentina is a signatory, particularly ILO (International Labour Organization) standards. These legal battles will create months or years of uncertainty about implementation, even after the bill becomes law. ### 3. Additional General Strikes Within 60 Days **High Confidence** The union movement has demonstrated both capacity and willingness to organize massive strikes—this was already the fourth such action of Milei's presidency (Article 5). Once the Senate passes the final version, unions will almost certainly call for another general strike as both protest and demonstration of their continued power. The pattern of escalation suggests these strikes may become more confrontational, building on the clashes with police already reported in Article 4. ### 4. Corporate Investment Remains Cautious Despite Reforms **Medium Confidence** While the government argues the reforms will "spur investment and boost formal employment" (Article 3), the intense social conflict and legal uncertainty will likely cause international investors to adopt a wait-and-see approach. Companies may hesitate to make major commitments until they observe whether the reforms survive legal challenges and whether social unrest stabilizes. This could undermine Milei's core argument that labor flexibility will drive economic growth. ### 5. Erosion of Milei's Political Coalition **Medium Confidence** The narrow vote margin and requirement for center-right allies' support suggests Milei's coalition is already stretched thin. As social unrest continues and economic benefits fail to materialize quickly, some coalition members from more moderate parties may distance themselves from the reforms, particularly if they face electoral consequences in their districts. This could complicate Milei's ability to pass future reforms. ### 6. International Labor Organization Intervention **Medium-Low Confidence** Given the scale of the rollback of worker protections, international labor bodies may formally censure Argentina or issue warnings about violations of international labor standards. This would provide ammunition to domestic opponents and potentially complicate Argentina's international trade relationships, particularly with countries that include labor standards in trade agreements.

Conclusion

While Milei appears poised for a legislative victory, the real battle over Argentina's labor future is just beginning. The president's challenge will be transforming legal passage into practical implementation amid sustained resistance from powerful unions, potential court interventions, and a deeply polarized society. The coming months will test whether Milei's libertarian vision can overcome Argentina's entrenched labor traditions—or whether the social cost of these reforms will prove politically unsustainable.