Argentina enacts key regulations for 2026 labor modernization law

On 1 May 2026 the Argentine government published decrees 408/2026 and 409/2026 in the Official Gazette, giving operative force to three mechanisms that were pending in the Labour Modernisation Law N° 27.802 passed earlier in the year. The decrees regulate the Promotion of Registered Employment regime (PER), the Incentive to Formal Labour regime (RIFL) and the Labour Assistance Fund (FAL).

PER allows employers to settle unpaid or irregular labour liabilities with reductions that vary by company size, extinguishing related criminal actions and removing the employer from the sanctions registry. RIFL, active from 1 May 2026 to 30 April 2027, offers a reduction of employer social‑security contributions of about 13 % for the first 48 months of a new contract, targeting the long‑term unemployed, freelancers and former public‑sector workers. FAL requires employers to retain a portion of their contributions in a market‑linked fund that can be used to meet future indemnity obligations; it will become operational in November 2026.

Experts say the RIFL may have the greatest immediate effect by lowering hiring costs, but its impact will be limited without broader economic growth. The broader labour reform, comprising four decrees (406‑409), is criticised for weakening collective bargaining, promoting “company‑friendly” unions and substituting wage increases with non‑remunerated benefits such as food vouchers.