Will Chile Follow Suit? Milei’s Labor Reform Aims to Reverse Over a Century of Progress in Argentina

El Ciudadano

Original article: ¿Chile seguirá la misma senda? La reforma laboral de Milei que busca retroceder a Argentina más de un siglo

Employers Could Dismiss Workers Without Cost and Set 12-Hour Shifts: Milei’s Anti-Rights, Anti-Union, and Anti-State Project Undermines a Century of Progress in Argentina

According to a report from Página/12 in Argentina dated December 12, 2025, President Javier Milei’s government has submitted a labor reform to the Senate that is disguised as «modernization,» yet seeks a «reversal of more than a century» regarding acquired rights.

Read also / José Kast and Javier Milei: More Than Just Friends

The report indicates that the 191-article proposal «disregards basic pillars of labor law such as the eight-hour workday and restricts the right to strike,» representing a «regressive transfer of workers’ rights in favor of capital.» The source notes that the final text «weakens workers’ organizational capacity and empowers employers to modify labor conditions at will.»

This reform is labeled as «one of the most significant regressions in rights since the return to democracy,» containing measures with substantial impact. Regarding working hours, the report elaborates that the text «confirms the establishment of hour banks, allowing for shifts of up to 12 hours,» diluting the compensation for overtime work. Concerning layoffs, Página/12 reports that the calculation basis for severance payments is reduced by excluding components such as holiday pay, and allows small enterprises to pay these in installments. Additionally, it introduces a Labor Assistance Fund (FAL) which, according to lawyer Natalia Salvo consulted by the newspaper, means «it will be free for employers to dismiss workers while social security becomes underfunded.»

Another critical element of the reform, based on the analysis, is the attack on collective organization. The proposal «incorporates limits on the right to strike by expanding the definition of essential services» and establishes a category of «transcendently important services» which, according to researcher Luis Campos, directly affects «almost all activities, including the food service industry, oil production, or the media sector.» Furthermore, the report highlights that the initiative «decentralizes collective bargaining» and restricts union membership, leading experts to conclude that it is «profoundly anti-rights, anti-union, and anti-state.»

Página/12 warns that the project particularly harms self-employed workers and platform workers by «inverting the presumption of labor.» This means, as explained by the media, «there will no longer be a presumption of an employment contract,» leaving thousands unprotected. Lawyer Natalia Salvo emphasizes in the article that this «modernization» is essentially «a museum piece that takes us back to an era without regulations,» ignoring global advancements and regressing to a model predating the 1929 Eight-Hour Workday Law.

The report concludes by emphasizing the central contradiction: in a context with a 43% informality rate, the reform «pushes the country towards a past devoid of safeguards, where labor relations were left to the will of the strongest: the employer.» Far from creating formal employment, Página/12 concludes that the only goal of the project is «to reduce costs for the employer and expand the lack of protection for the most vulnerable sectors.»

Risks of Regression in Labor Rights in Chile

The Unitary Central of Workers (CUT) through its National Executive Council has publicly declared that after analyzing José Antonio Kast’s program, «voting for the far-right candidate is voting against workers and the rights that have been achieved». The union organization, cited in its statement on November 24, warns that the far-right represents «a profound regression for the world of work», jeopardizing significant achievements regarding workers’ dignity, such as reducing the workweek to 40 hours, the Karin Law, and sustained increases in the minimum wage.

The core of the threat, according to analysts and leaders, lies in specific proposals aimed at dismantling pillars of labor protection. Kast’s program proposes «eliminating severance pay for years of service» and replacing it with an individual fund, an idea that, as noted by political scientist Tomás Arias from the Chile 21 Foundation, and reported by El Mostrador, will translate into increased labor precarity for workers and a less present state: «These proposals reveal that Kast’s labor proposal was crafted from distorted narratives and ideological fanaticism, without genuinely considering the most disadvantaged workers in our society.»

Antonio Páez (former Starbucks union member), cited by IzquierdaDiario, emphasizes: «Remember that there was already an initial attack on severance during the military dictatorship, when in 1981, José Piñera’s labor code reduced service years to 11. And now what Kast wants is for us, as workers, to pay for our years of service through a monthly ‘savings’ plan, which will come out of the worker’s pocket. Currently, companies do not even want to pay the 11 years, which is why many severance payments end up in litigation,» freeing companies from responsibility.

Additionally, a dangerous «flexibilization» of work hours and severance agreements is proposed, weakening the oversight of the Labor Directorate.

Union organizations are calling for mobilization and active defense. Both the CUT and the ANEF – which in its XIX Extraordinary National Assembly resolved to support candidate Jeannette Jara – have urged their bases to inform and organize.

The national president of ANEF, José Pérez Debelli, called to «defend public employment, job stability, and workers in the state against any assault».

Read also ANEF statements