Along with the change of government and the renewal of the National Congress, a new Minister of Labour and Social Security, a new National Labour Director, and a new Director of the National Migration Service will be appointed for the 2026–2030 term.
These changes will lead to new guidelines for the application, interpretation, oversight, and compliance of legal regulations affecting employers, workers, and unions. This is particularly relevant as key labour laws enacted during the previous administration will partially enter into force next year.
Although 2025 was expected to have less legislative activity due to elections, the period was marked by significant administrative rulings impacting labour relations management issued by the Labour Directorate (DT), the Superintendency of Social Security (SUSESO), and the Comptroller General of the Republic.
At the legislative level, the main changes this year were defined by the implementation of the Pension Reform, starting with the first adjustment to social security contributions. Within the current public debate, a broader discussion on severance pay and statutory grounds for termination is expected next year. From a labour case law perspective, new relevant rulings are expected to unify criteria on key issues such as the misuse of medical leave, harassment, and anti-union practices.
1. Reduction of the Working Day – Implementation of the 40-Hour Law
On 26 April 2026, the second stage of the “40-Hour Law” will take effect, requiring companies to reduce the standard workweek from 44 to 42 hours. This reduction must not, under any circumstances, result in a decrease in employee compensation; therefore, internal adjustments must be driven by efficiency.
The law requires employers to reach—or at least attempt to reach—an agreement with workers or unions on how the work schedule will be adjusted. Under Law No. 21,755, if no agreement is reached, the reduction must be applied as follows: by hours (for five-day workweeks) or by 50 minutes per day (for six-day workweeks). Companies that cannot comply with these provisions may face fines of up to US$4,000 per violation.
2. Entry into Force of the Personal Data Protection Law
On 1 December 2026, the Personal Data Protection Law will enter into force. This regulation establishes a new oversight authority: the Personal Data Protection Agency. The regulation expands the legal bases for data processing, strengthens informed consent, incorporates principles such as transparency and proactive accountability, and grants new rights to data subjects, including portability and the right to object to automated decisions.
Furthermore, it establishes obligations for organizations, such as appointing a Data Protection Officer (DPO), maintaining activity logs, implementing security measures, and notifying of security breaches. Non-compliance can lead to fines of up to US$1.5 million, 4% of annual sales revenue, or even the suspension of company operations.
3. Pension Reform: Increase in Employer Contributions
Pension contributions funded by the employer will increase gradually. Starting 1 July 2026, the employer contribution rate will be 3.5% of the worker’s taxable income, representing a 2.5% increase over the current rate. This increase coincides with the implementation of the Autonomous Pension Protection Fund (FAPP), designed to finance social security insurance. Additionally, a unified pension collection system will begin operating to centralize the collection of unpaid pension contributions.
4. Strategic Analysis of Labour Regulatory Trends and Potential Institutional Changes
The implementation of Law No. 21,561 has generated administrative interpretations that could be reviewed under a new institutional leadership. Currently, certain criteria allow for overtime in exceptional shift systems and establish new methods for calculating additional rest days, which have been criticized for deviating from the literal text of the Labour Code.
Additionally, authorities have modernized the concept of “immediate superior supervision,” allowing technological monitoring to suffice for limiting workers’ scheduling freedom. A change in authorities could signal a return to more traditional doctrines requiring physical presence for supervision or a modification of current payment formulas for rest days, directly impacting operational flexibility and compliance costs for companies.
Regarding Law No. 21,643 (Karin Law), the current regulatory framework imposes investigation protocols that, in some aspects, exceed statutory provisions. Critical points, such as the obligation to refer complaints against high-level executives directly to the Labour Directorate or the inability to perform an admissibility check to discard inconsistent complaints, are highly sensitive issues that could be adjusted. A new authority could redefine the scope of preventive measures and the company’s autonomy to conduct its own internal investigations.
Lastly, Law No. 21,719 and Decree 44 present compliance challenges. Currently, a high standard is required for the use of biometric data, and active union participation in preventive risk management is promoted. It is foreseeable that new authorities will adjust the criteria for consent in data processing and define social dialogue spaces with greater precision, ensuring that the employer’s duty of protection does not result in a loss of control over production processes.
5. Publication of Amendments to the Inclusion Law Regulations
Law No. 21,690 mandated the Executive to amend Decree No. 64, which is still pending publication. These amendments must define the content of the Workplace Environment Protocol, a mandatory document for all companies with 100 or more workers. The protocol must be communicated annually to employees and incorporated into electronic communications in subsequent years.
