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ARGENTINA | 05-01-2024 00:58

First judicial setbacks for Milei’s reform push

Labour appeals court suspends key portions of mega-decree after legal challenges from top union groups, dealing president a setback.

Javier Milei has suffered the first judicial setbacks of his Presidency, with a top labour appeals court issuing injunctions to suspend a key portion of his emergency mega-decree.

Interrupting the January court holiday, the National Labour Appeals Court issued injunctions on successive days this week to halt the labour reforms contained in President Milei’s mega-decree issued last month, upholding requests by the CGT (Wednesday) and CTA (Thursday) trade union umbrella groupings.

In their rulings, the three judges warned of “the grave risks of social conflict – already visible in the closing days of 2023 – spreading into unprecedented violence.”

Given the similarity of the presentation by CTA leader Hugo Yasky to the CGT’s, the same criteria were applied in both rulings.

The judicial measures, while not final, are the first major legal challenges to Milei’s sweeping economic deregulation plan intending to change more than 300 statutes.

Thousands took to the streets last week to protest the reforms proposed by Milei, who won the November run-off with promises of slashing state spending as Argentina deals with an economic crisis, including triple-digit inflation.

For his part, an optimistic President Milei sought on Thursday to belittle the judicial setback, arguing: “Football matches are 90 minutes, they don’t end until the final whistle. We are confident that everything is going to work out.”

Milei told the press that he was aware that a huge percentage of the population was suffering from the decisions being taken by his government but that "doing nothing or doing the same as before would be infinitely worse."

"I don’t want an Argentina with 98 percent below the poverty line and half destitute," he said before trying to conclude on a more encouraging note by saying: "We’re getting there" with the benefits of what he was doing becoming visible in 15 years’ time.

CTA leader Yasky hailed the ruling as a step that would prevent “serious damage that is impossible to repair later.”

"With this ruling, the justice system has put a stop to those who think that by simply signing decrees they can eliminate labour rights that have been fought for decades, discussed in the spheres of democracy, laws and congressional actions,” the CTA leader said in a statement.

“The executive branch should understand that in Argentina there are three powers and that it is anti-democratic to subjugate the role of the other branches."

It added: "The ruling clearly states that the DNU represents a labour reform of immediate application in labour matters that causes serious damage that is impossible to repair later."

 

Legal challenges

The CGT had challenged the sweeping deregulatory decree on the grounds that it eroded basic worker protections such as the right to strike and parental leave. The decree also increased the legal job probation period from three to eight months, reduced severance and cut pregnancy leave.

Judge Alejandro Sudera also questioned the "necessity" and "urgency" of the decree Milei signed on December 20 – just 10 days after taking office – while adding hat it was unclear how the changes contributed to Milei's objective of "creating real jobs." 

The injunction suspending the measures until they can be properly considered by Congress.

marked at least a temporary victory for the CGT, Argentina’s most powerful labour grouping. 

“Since the trade union confederations have called a general strike for January 24 and since the Supreme Court has decided against immediately ruling on the emergency decree in question, the dangers of delay are all the greater, taking into account the important amendments introduced by that decree,” warned the appeals court judges to justify their latest injunction in the midst of the January court holiday.

Sources linked to Treasury attorney Rodolfo Barra communicated that both rulings would be appealed to the Supreme Court, a step for which they have three days. But previously the nation’s highest tribunal had responded to a writ from the La Rioja provincial government by saying that they would not intervene until after the January court holiday is over and after the Attorney-General has delivered his opinion. Until then and until the Bicameral Commission decides on the mega-degree’s validity in Congress, the labour reforms contemplated in the emergency decree are suspended. 

On Thursday presidential spokesman Manuel Adorni confirmed that the adverse ruling would be taken to the Supreme Court, commenting: "We find it difficult to understand some issues which go against the liberty of the workers themselves, such as the elimination of their compulsory contributions to trade unions."

 

Protests ahead

The CGT has called a general strike for January 24 – the first of the Milei administration and a major challenge to Security Minister Patricia Bullrich’s hardline approach to policing protest.

Milei’s measures have drawn heated debate among jurists about their constitutionality and are the subject of dozens of court challenges. Among other initiatives they eliminate a law regulating rent, envisage the privatisation of state enterprises and terminate some 7,000 civil service contracts.

Argentina’s economy is on its knees after decades of debt and financial mismanagement, with inflation surpassing 160 percent year-on-year and more than 40 percent of the population living in poverty.

Milei has pledged to curb inflation but warned that economic "shock" treatment is the only solution and that the situation will get worse before it improves.

The 53-year-old won a resounding election victory on a wave of fury over the country's decades of economic crises marked by debt, rampant money printing, inflation and fiscal deficit.

His rival candidate, ruling coalition hopeful and former economy minister Sergio Massa, failed to convince voters that he could lead Argentina out of its economic quagmire.

Milei has targeted public spending cuts equivalent to five percent of gross domestic product. Shortly after taking office, his administration devalued the peso by more than 50 percent, and announced huge cuts in generous state subsidies of fuel and transport.

Argentina’s new libertarian leader has also announced a halt to all new public works and a year-long suspension of state advertising, among other measures.


 

– TIMES/AFP/BLOOMBERG

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