An Argentine court has overturned labor rules proposed by President Javier Milei, which aimed to make it easier for employers to fire workers. This decision deals a blow to Milei's efforts to reform regulations that he believes have been holding back the country's struggling economy.
The appeals court had previously issued a temporary suspension of the new regulations in early January, following a legal challenge brought by the General Labor Confederation, the main union group in Argentina. On Tuesday, a three-judge panel declared the regulations unconstitutional, arguing Milei's government had exceeded its authority by implementing the rules without congressional approval.
It is worth noting that the recent court ruling can be appealed before the Supreme Court, but it remains uncertain whether Milei's administration will pursue this course of action.
Milei had announced the labor rule changes in December through a presidential decree. Among the proposed modifications were an increase in job probation period from three to eight months, a reduction in severance compensation, and the provision that workers participating in blockades during protests could be dismissed.
President Milei, who identifies himself as a libertarian and anarcho-capitalist, has been determined to reduce state spending in order to address the government's budget deficit and curb inflation, which stood at a staggering 211% by the end of 2023. Since taking office on December 10, Milei has implemented several measures, including a 50% devaluation of the national currency, cutting transport and energy subsidies, and announcing that contracts for over 5,000 state employees hired before his presidency will not be renewed.
Naturally, these actions and proposals have not been without controversy or opposition. The proposed labor rules sparked protests in Buenos Aires, the capital of Argentina. Just last week, a one-day general strike was organized by the largest union in the country. While some government officials sought to downplay its impact, the demonstration reflected the unease and discontent among certain segments of the population.
Despite this setback, President Milei remains determined to push forward with his agenda of economic reforms. The court ruling, however, highlights the challenges that lie ahead for his administration, especially in enacting changes to labor regulations which require parliamentary approval. As the situation unfolds, it remains to be seen whether Milei's government will appeal the decision and continue to pursue its labor reform objectives through legal means.
