There are hundreds of thousands of labor disputes underway in the country, and their number represents 10% of the total number of workers registered in the private sector.
12/08/2025 – 09:30 am
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Argentina’s political and economic agenda is shaped by the strong pressure from the national government to promote labor reform profound, according to its proponents This is crucial to reactivate formal job creation and reduce the burden on businesses. This debate, which resonates with both trade unions and business, finds its basis in a structural fact that calls into question the country’s competitiveness and legal predictability: the gigantic inventory of pending labor law disputes. The extent of legalization of work became the central argument of those seeking to change the Labor Contract Law and other related systems.
The figures processed by the various actors in the system – from the judiciary to professional liability insurers and economic chambers – paint a panorama of legal disputes that, due to their scope and the associated financial consequences, exceed regional and international parameters. It is a reality that has harsh implications for SMEs and long-term investment decisions. The accumulation of cases and the uncertainty of court decisions have become a systemic factor that hinders the formalization of the world of work and keeps millions of Argentines in the precarious situation of undeclared work.
In the context of the search for new rules, a recent report shows the true scale of the problem: the total number of labor court files awaiting resolution in the country’s various jurisdictions represents a burden that amounts to almost 640,000 cases. These half a million protracted cases represent a mountain of contingent liabilities and are evidence of the ineffectiveness of the current system in resolving conflicts quickly and fairly. The figure is seen as a powerful driver to accelerate discussion of legislative changes aimed at making the labor market more predictable.
The government is promoting a labor reform being discussed.
The number that affects Argentina: almost 640,000 files paralyze investments
The most compelling data in the labor reform debate is not the number of new applications, but the consolidated stock that is straining the production system: There are currently almost 640,000 work processes pending throughout Argentina.. This figure shows not only the operational collapse of the jurisdiction, but also the enormous economic risk faced by the business community, from large corporations to small businesses.
The problem is that, in a context of high inflation and economic volatility, judicial delays prolong proceedings and final judgments are issued based on complex formulas to update loans. These formulas, which vary by jurisdiction and time, have been questioned by the employer sector because they can exponentially multiply the original compensation amounts. A claim that began with a foreseeable value can, after years of processing, end in a judgment with interest and capitalization that exceeds the ability to pay, leading to business closures and mass layoffs.
The almost 640,000 files that make up this liability are divided into claims of different types Litigation due to industrial accidents and fines due to poor registration, which generally generate the highest amounts. The government is trying to change this panorama of legal uncertainty through legislative instruments that will hopefully disable the incentives for legalization that both employees and specialized law firms currently perceive. The aim is to drastically reduce this historical number and ensure that conflicts are resolved in upstream administrative instances or with uniform resolution criteria.
Labor reform as an attempt to reduce the “trial industry”.
One of the main goals of the labor modernization project currently being discussed in Congress is to address the root of the “litigation industry,” a term used by business chambers to describe the excessive growth of lawsuits.
The legislative change proposal focuses on two main pillars to address the backlog of 640,000 cases:
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Regulation of interest and updating: The goal is to set a limit or predictable formula for updating work credits owed. The idea is to replace the current arrangements (which involve interest capitalization or indexation through interest rates above inflation) with a more sensible mechanism that maintains the purchasing power of the amount owed without penalizing the defendant company with ruin. This point is considered essential to promote out-of-court settlements.
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Simplifying fines and registration: The project aims to change the fines imposed on employers for failure to register. Critics of the current system argue that these fines are so high that their risk discourages employees from registering. The aim of the reform would be to simplify the formalization process and ensure that the employer wishing to exit informality is not exposed to disproportionate risk in the event of the slightest administrative failure.
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