In a decisive turn for President Javier Milei’s economic agenda, Argentina’s National Chamber of Labour Appeals this week restored the government’s sweeping labour reform, setting aside a lower court injunction that had suspended 82 articles of Law 27,802. The ruling, issued by the chamber’s Sala VIII, grants suspensive effect to the state’s appeal, meaning the reform is now in full force while the underlying legal challenge proceeds. The decision reverses a first-instance judge’s order that had temporarily blocked changes to dismissal rules, trial periods, and collective bargaining provisions — measures the government argues are essential to modernise a rigid labour market long blamed for stifling formal employment.

From Buenos Aires, the response was sharply polarised. The General Confederation of Labour (CGT), which originally sought the injunction, condemned the ruling as a blow to workers’ protections, while business chambers such as the Argentine Chamber of Distributors and Self-Service Wholesalers (CADAM) hailed it as a necessary step toward regulatory clarity. At a wholesale-sector conference in Pilar, more than 200 executives applauded the news, pressuring the administration to move swiftly on secondary regulations.

Viewed from Washington, the appellate decision bolsters Milei’s credibility with international investors who have watched his deregulation drive with cautious optimism. Analysts in London note that the reform’s survival through the courts is a litmus test for the president’s broader institutional reform agenda, which has faced fierce opposition from organised labour and a fragmented congress. Yet the legal saga is far from over.

The government has asked the Supreme Court to intervene, and the CGT has vowed to exhaust all judicial avenues. For now, the practical effect is immediate: employers can implement more flexible hiring practices, reduce severance costs for new contracts, and adjust working hours with fewer bureaucratic hurdles. The longer-term implications, however, depend on whether the Supreme Court ultimately upholds the reform — and on how quickly the labour market adapts.

If the ruling stands, Milei’s campaign promise to tear down what he calls the “collectivist straitjacket” on employment will have cleared its sternest legal hurdle. If overturned, the already-fragile confidence in Argentina’s economic trajectory may suffer another blow.