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A controversial reform introducing a 12-hour workday has brought up concerns over the potential exploitation of the nation’s workers amid the Argentinian government’s efforts to ease the nation’s economic troubles.
Over the last two months, Argentina was swept by rumors of a labor reform that critics claim would set the nation back a century. That speculation became a reality just days ago when the Senate approved a controversial bill establishing a 12-hour workday.
While a 12-hour shift sounds extreme, the mechanics of the reform are slightly more nuanced than they appear. In fact, the proposal spearheaded by Argentina’s President Milei himself doesn’t mandate a 60-hour work week. Instead, it introduces a flexible ‘hours banking’ system that while different from a daunting 12-hour grind, still faces heavy criticism.
Before diving into the new reform, it’s essential to understand that Argentina’s economy has been stuck in a loop of decay for years. With inflation making everything unaffordable, roughly 40% of workers now operate in the informal market without any legal protection.
This is largely because hiring is so expensive that businesses simply can’t afford it. Milei’s argument is that the country’s labor are relics of the past that act as a barrier to employment, and as an extension economic growth.
Under current laws, workers are protected by a strict eight-hour daily cap and a 48-hour weekly limit. Any time worked beyond those 8 hours automatically triggers overtime pay.
Now, the new reform replaces this cap with a time bank system. Within this mandate, a worker might pull a 12-hour shift during a busy streak, but instead of receiving extra pay, those four additional hours are banked to be used as time off later.
In pulling such a move, the government believes that this makes hiring more predictable for businesses. As many critics have cited, however, a huge component of this reform is dedicated to making it cheaper to fire people.
Right now, if an employee sues a company for unpaid overtime, the penalties are massive for the business should the employee be fired. By removing the high cost of overtime and making it essentially cheaper to fire employees, Milei hopes that the reform gives businesses more confidence in hiring people the legal way.
While the government anticipates economic growth, it’s the workforce that is bearing the immediate cost. For many, overtime isn’t a luxury but rather a means of survival amid high inflation rates. By allowing companies to bank hours instead of paying for overtime, the reform strips away a vital source of income in an unstable economy.
