Date: Sat, 4 Dec 1999 21:36:00 -0600 (CST)
From: IGC News Desk <email@example.com>
Subject: POLITICS-CHILE: Labour Reforms Rejected, Gov't Awaits Fallout
Copyright 1999 InterPress Service, all rights reserved.
Worldwide distribution via the APC networks.
Labour Reforms Rejected, Gov't Awaits Fallout
By Gustavo Gonzalez, IPS
2 December 1999
SANTIAGO, Dec 2 (IPS) - The Chilean Senate voted down government-proposed
labour reforms, raising questions about the failed bill's
political impact on upcoming presidential elections, and leaving
the country in a tricky situation for future international trade
Senators from right-wing parties and five of Chile's nine
appointed senators caused two tie votes on the reforms Wednesday,
automatically postponing legislation on the issue for one year.
The debate and votes at the Senate headquarters in Valparaiso,
120 km west of Santiago, ran seven hours over-time, drawing to a
close late Wednesday night, amid the tense environment sparked by
trade union demonstrations in favour of the reforms.
President Eduardo Frei's labour bill, which had been approved by
the Chamber of Deputies, parliament's lower house, was loudly
criticised by right-wing parties and business associations, who
portrayed the bill as a step backwards.
The bill's reforms would have ended the provisions of the Labour
Code inherited from the Augusto Pinochet dictatorship (1973-90).
Pinochet applied neo-liberal policies for labour market
deregulation in order to encourage private investment.
The dictatorship's laws were modified during the democratic
transitional government of president Patricio Aylwin (1990-94),
based on consensus agreements with the right-wing, reinstituting
some labour rights.
The second round of reforms was presented before parliament five
years ago, but had been shelved until Frei recently declared
labour reform an urgent matter. The presidential manoeuvre is
interpreted as a challenge against the rightist parties, because
it came during the run-up to the Dec 12 presidential elections.
The Senate rejected changes in labour laws including collective
bargaining for inter-business unions and terminating employer
rights to replace striking workers if they did not accept an
agreement within 15 days of the work stoppage.
The reforms would have extended collective bargaining rights to
unions of temporary, part-time or provisional workers, who make up
a large part of the workforce in the agricultural and construction
The president's bill also proposed to increase compensation for
firings arising from anti-union practices from 50 to 100 percent
of the worker's wages, the difference to go to the union. The bill
would also require businesses to inform employees of their
economic and personnel policies.
Felipe Lamarca, president of an industrial business-owners
organisation, sharply criticised the reforms a week ago, and, on
Monday, the president of the Production and Trade Confederation,
Walter Riesco, stated that the bill's implementation would mean a
"return to the UP (Popular Unity Party)."
Riesco alluded to the leftist alliance that governed Chile from
1970 to 1973, until president Salvador Allende was overthrown by
Pinochet's coup. Joaqu¡n Lav¡n, presidential candidate for the
rightist Alliance for Chile, however, said Riesco's comparison was
a gross exaggeration.
Ricardo Lagos, candidate for the governing centre-left Coalition
for Democracy, chastised business leaders for lacking a vision for
the future and for defending discriminatory labour laws that most
other countries have eliminated.
Lagos warned that international trade and investment negotiations
now generally include labour and environmental rights as decisiive
Mar¡a Rozas, legislator and former vice-president of the Workers
Central United (CUT), indicated that the "social label" is
essential for trade relations with the rest of the world.
The Frei government attempted to put the right-wing and candidate
Lav¡n "between a rock and a hard place," forcing them to approve
the reforms or pay the political price in the upcoming elections.
It is not clear, however, if the president was successful.
The right-wing and business community's rejection of the reforms
was evident in their publicity campaign that created an image of
chaos and alleged that the labour reforms would harm the workers
themselves, especially employees of small and medium-sized
Public declarations in favour of the reforms, made by the CUT,
several other trade unions and popular Catholic bishops, did not
achieve the same mass media circulation as the anti-reform
According to the results of a telephone survey released Thursday
by the rightist Future Foundation, 38.1 percent of Chileans polled
support the labour reforms, 32.4 are against, and 29.4 percent are
In the end, the government gave in to the anti-reform campaign
and made it known before the Senate vote that, once the bill was
approved, Frei would veto the bill in order to "correct" the
points the right-wing and business community considered most
This political move created problems within Frei's own Christian
Democratic Party, between trade unionists and left-leaning
factions on one side, and senators and ministers who backed the
veto idea on the other.
The veto would have been implemented if the labour reforms had
been approved, but the strategy hit bottom when the rightist and
designated senators were able to gather 23 votes in order to tie
the governing coalition in the two rounds of balloting.
The government hoped to reach a majority in the Senate, but the
opposition was able to win over appointed senators Ram¢n Vega,
from the Air Force, and Fernando Cordero, of the Customs Police.
In addition, the rightist parties pushed Marcos Aburto, the
Supreme Court's designated senator, to attend the decisive
session, despite his poor health, in order to cast the vote that
resulted in the ties. (END/IPS/tra-so/ggr/ag/ld/99)
[c] 1999, InterPress Third World News Agency (IPS)
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