Labour reforms

At a glance

• On 29 December 2023, a decree titled the Basis for the Reconstruction of the Argentinean Economy (Decree) came into force.
• The Decree declared a public emergency on economic, labour, pension, administrative, financial, tax, health, and social matters.
• The changes made to labour law include matters regarding registering employees, remuneration, employment relationships, tele-working and maternity leave.
• On 3 January 2024, the Labour National Chamber of Appeals issued a precautionary measure suspending the labour aspects of Decree 70/23.

Newly elected Argentinean President, Javier Milei, took office on 10 December 2023 and within ten days, issued an urgent and necessary Decree (No. 70/2023).

The Decree declared a public emergency on economic, labour, pension, administrative, financial, tax, health, and social matters. It came into force on 29 December 2023.  

The most relevant changes to individual labour law introduced by the Decree include:

• a repeal of the fine systems for lack of, or incorrect, registration;
• a simplification of the employee registration process, which will now be entirely electronic;
• salary payments can be made through a range of formats such as e-wallets or crypto currency;
• judges will now be obliged to promote a thorough investigation of evidence in cases where they have to decide on the facts, rather than applying the current, strict ‘what is most favorable for the worker’ test;
• the assumption of the presence of an employment contract is removed when procuring professional services that are adequately documented in the accounting records of both parties;
• employees hired through agencies will be considered direct employees of companies that register the employment relationship, keeping the joint liability of the parties involved in the engagement with regard to the social and labor obligations;
• the extension of maternity leave for those who have birthed their child;
• union strikes and/or force measures in the workplace are now included as a sufficient cause for termination of the employment contract, with no severance payment.
• confirmation, echoing the recent jurisprudence, that the 13th salary and any other extraordinary sum received on a semi-annual or annual basis by the employee should not be considered as a basis for the calculation of the severance payment;
• changes introduced to the calculation of remuneration for those employees who are paid on commission;
• consent given to those working in a presential position to work remotely can only be reversed by an agreement between the worker and the employer, where the company has the facilities to enable this.

This decree has been enacted by the Presidential Office but does not yet have the approval of Congress. Usually, while Congress is undergoing several exhaustive review sessions, according to the law that regulates these kinds of decrees, the Decree will be valid and enforceable eight days after it is issued by the President. However, on 3 January 2024, the Labour National Chamber of Appeals issued a precautionary measure suspending the labour aspects of Decree 70/23. As a result of this court order, no labour changes are currently in force. The government has filed an extraordinary appeal to the Supreme Court, which has not yet been decided.

For additional detailed information about these and other changes included in the decree, you can contact our office at any time.