Bachelet at the crossroads: workers or employers?

Michelle Bachelet, elected president of Chile in the second round with 62.1 per cent of the vote and inaugurated on 11 March, is faced with no easy task on the labour front.

Her government programme proposes a range of labour reforms, but she is confronted with employers who have been staving off these changes for over four decades and who have already made it clear, through the press duopoly, that private investment is likely to suffer if Bachelet decides to go ahead with her plan.

“The playing field between workers and employers needs to be levelled,” Bachelet has said. But an alarming set of figures has to be dealt with: only eight per cent of labour contracts are negotiated collectively in Chile; 600,000 young people are neither in employment nor education; the pay gap between the highest and the lowest paid is still widening, and the average salary is no more than 251,600 pesos a month (US$435).

Added to the above is the growth in subcontracted work in Chile, which rose to 17.3 per cent in August 2013; and although the rise in temporary and subcontracted work may improve employment figures, it also increases the prospect of fewer decent jobs.

In addition, according to the August 2013 figures of the National Institute of Statistics (INE), published in a Fundación Sol report, only 56 per cent of workers have a permanent contract, social security, health cover and unemployment insurance.

This leaves a large proportion of Chileans in a precarious employment situation.

Another serious element that cannot be left aside is the power employers still have to replace striking workers, through the payment of four units of account (UF, US$164) for every worker, which frustrates collective bargaining processes and undermines trade union power.


The proposals

There are basically three broad dimensions to Bachelet’s proposals to level the playing field between social actors:

The first involves increasing trade union organising and collective bargaining.

The second involves actions designed to promote worker participation, improve the quality of employment, raise wages (minimum wage and the payment of bonuses) and increase productivity.

The third is aimed at strengthening and improving the country’s labour institutions.

It should be noted that the Bachelet government programme establishes a close link between the rise in wages and the rise in productivity; this potential conditionality is something that requires closer analysis.

As the ILO states in Rules of the Game, “labour is not like an apple or a television set, an inanimate product that can be negotiated for the highest profit or the lowest price.”

Likewise, continuing to see economic growth as a government’s key objective is a mistake; the goal should be to improve people’s quality of life.


The challenges

To move forward with her programme, which is full of good intentions, Bachelet will have to deal with national and multinational companies accustomed to operating in Chile with rules made to suit them, not the workers.

She will have to contend with the power of the mass media, which responds to the interests of the business elite, and be able to engage in dialogue and rouse popular support among the students and workers whose social protests have grown in recent years.

The Campaign for Freedom of Association headed by the Trade Union Confederation of the Americas (TUCA) will, for its part, provide backing for the workers’ demands in Chile.

The country’s national trade union confederation, Central Unitaria de Trabajadores (CUT), will have to assume the great responsibility of ensuring respect for the International Conventions already ratified by Chile, especially in the face of its direct interlocutor, Labour Minister Javiera Blanco, who comes from the board of Fundación Paz Ciudadana, a foundation connected to Agustín Edwards, owner of El Mercurio, a powerful newspaper group with strong ties and allegiances to corporate interests.


This article has been translated from Spanish.