Argentina approves Milei's radical labour reform amid nationwide strike, clashes

The lower house of Argentina’s Congress has approved a contentious labour reform bill backed by libertarian President Javier Milei, despite a nationwide strike by unions opposing the changes that had brought parts of the country to a halt.

Investors have been closely watching the legislation, passed by 135 votes in favor with 115 against on Friday, to see whether Milei has the power to continue implementing his free-market agenda.

The government says the bill, approved last week by the Senate with support from the ruling party and its centre-right allies, will spur investment and boost formal employment.

Lawmakers were debating modifications in the early hours on Friday before sending the bill back to the Senate for a final vote to become law. Among the changes was the removal of an article that reduced sickness-related benefits for employees.

"What good is an entire library of labour legislation if, at the end of the day, the system it establishes doesn’t serve to create jobs?" ruling party lawmaker Lisandro Almiron asked during the debate on the bill.

Nationwide strike

Unions say the proposed overhaul threatens long-standing worker protections, including the right to strike. In protest, the powerful CGT union called a 24-hour stoppage on Thursday by transport workers, public sector staff, and bank employees.

Dozens of flights were cancelled, and train stations were left deserted with only a handful of buses running. On roads leading into the capital Buenos Aires, small groups of protesters blocked traffic.

Later in the day, several thousand demonstrators gathered outside parliament, where a few dozen participants engaged in running battles with police, throwing bottles and stones. Officers replied with tear gas, water cannons, and rubber bullets to clear the area. Police were observed making about a dozen arrests.

The CGT labour federation said more workers adhered to the walkout call than during any of the previous three strikes.

"It has levels of compliance like never before under this government," union leader Jorge Sola told Radio con Vos, claiming that "90 percent of activity had stopped."

The contested reforms pushed by budget-slashing Milei, an ideological ally of US President Donald Trump, would make it easier to hire and fire workers in a country where job security is already hard to come by.

It would also reduce severance pay, limit the right to strike, increase work hours, and restrict holiday provisions.

Almost 40 percent of Argentine workers lack formal employment contracts, and unions say the new measures will make matters worse.

Massive job cuts

The labour action comes as Argentina's economy is showing signs of a downturn in manufacturing, with more than 21,000 companies having shuttered in two years under Milei.

He had come to power after wielding a chainsaw at rallies during the 2023 election campaign to symbolise the deep cuts he planned to make to public spending.

Unions say some 300,000 jobs have been lost since Milei's austerity measures began.

Most recently, Fate — Argentina's main tyre factory — on Wednesday announced the closure of its plant in Buenos Aires, prompting some 900 job cuts.

The last general strike in Argentina was on April 10 2025, but adherence was uneven as workers in the public transport system did not join.

Last week, thousands of people demonstrated in Buenos Aires as senators debated the reform bill, and clashes with police resulted in about 30 arrests.

On Tuesday, the government issued an unusual statement warning reporters about the "risk" of covering protests, and announced it would establish an "exclusive zone" from which the media can work.