Chile: Government Prepares to Promulgate Labor Bill After Court Rejects Challenge

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By Tom Azzopardi

July 15—The Chilean government is preparing to move ahead with its controversial labor bill after the country's Constitutional Court rejected a second set of challenges by opposition lawmakers against the strongly pro-union legislation, Government Secretary General Marcelo Diaz said on July 14.

The announcement came just hours after the court said it would not hear two challenges presented by members of the opposition Independent Democratic Union and National Renewal parties as they fell outside the stipulated time in which the court could hear such filings.

Who Can Negotiate?

The legislation, which aims to boost workers' pay and working conditions by giving them more leverage over employers in collective bargaining, also gives unions the power to decide which workers can share in negotiated benefits and bans the use of most replacement labor during strikes.

Opposition politicians had questioned whether the bill, which was approved by Congress last April, complied with a May 9 ruling by the court that the clause granting unions an exclusive right to collective negotiations amounted to a breach of all workers' constitutional right to negotiate collectively.

The government responded with a presidential veto removing the objectionable parts of the bill as well as clauses allowing workers and employers to freely negotiate some aspects of working conditions—issues the government said only permanent labor unions should be allowed to discuss.

The government dropped plans for a constitutional amendment to reinstate the supremacy of unions over other negotiating groups after realizing it lacked the necessary two-thirds majority in Congress.

Legal Vacuums?

Lawyers and business leaders have said that the resulting legislation contains legal vacuums, particularly regarding the status of non-union negotiations, which are likely to end up in the courts.

“Workers and business will lose out with this bill as we are predicting an increase in legal action around negotiations which will be bad for both sides,” said Ricardo Mewes, president of the Chilean Chamber of Commerce, on July 14.

Diaz said that the bill now only requires the obligatory revision of some of its clauses by the court before President Michelle Bachelet can sign the legislation into law.

“We hope this stage wraps up soon in order to proceed to the promulgation of the labor reform led by President Bachelet, with the gains it implies for Chile's workers and labor relations,” Diaz said.

To contact the reporter on this story: Tom Azzopardi in Santiago at correspondents@bna.com

To contact the editor responsible for this story: Rick Vollmar at rvollmar@bna.com

For More Information

For more information on Chilean HR law and regulation, see the Chile primer.

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