Argentina’s Senate Approves Milei’s Labor Overhaul as Molotov Cocktails Fly Outside Congress

Argentina’s Senate approved President Javier Milei’s labor reform at roughly 1:30 a.m. on Thursday, capping a 13-hour marathon session that unfolded against violent clashes between union protesters and riot police outside Congress. The bill now heads to the Chamber of Deputies, where the government wants final passage before March 1.

The legislation rewrites employment rules largely untouched since the mid-1970s. It reduces severance payouts, allows employers to compensate overtime with days off instead of extra pay, permits the splitting of annual vacations into week-long blocks, weakens national trade unions by shifting collective bargaining to the company level, and legalizes salary payments in foreign currency.

For Milei‘s government, the stakes are existential. Nearly 40% of Argentine workers operate in the informal economy, and officials argue rigid labor codes are to blame. Senator Patricia Bullrich, the ruling bloc’s congressional leader, called it the most important reform of the last half-century.

The opposition sees demolition, not modernization. Buenos Aires province Governor Axel Kicillof warned that putting severance, overtime, and vacation protections on the table would not improve conditions for anyone. The CGT labor confederation called the changes “regressive,” while critics note Argentina has lost roughly 300,000 formal jobs since Milei took office in December 2023.

Outside Congress, thousands of workers hurled petrol bombs, stones, and bottles at police lines, who responded with rubber bullets, water cannons, and tear gas. Authorities reported at least 15 arrests, and streets were left littered with shattered glass and smoldering debris.

The symbolic weight of the vote may outstrip its economic impact. Successive governments — including a military dictatorship — have tried and failed to reform Argentina’s labor laws. A 1984 attempt fell by one vote; a 2000 reform collapsed in a bribery scandal; a 2017 push never reached a vote. Milei’s own 2023 executive order was blocked in court after union injunctions.

Whether the bill survives the lower house intact is far from certain. Peronist deputies have vowed to fight it article by article, and the government has already negotiated some 30 amendments to smooth its path. For Argentine workers, the outcome will signal whether the country bends toward flexible labor models championed by international creditors — or whether Peronist-era protections hold.

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