Strike it rich

Mining companies in Chile wrestle with unions over wages.

Trade unions have always been one of the most visible and powerful actors in the Latin American mining sector.

In Chile, mining strikes have a noticeable impact on the country’s economy, which is also very difficult to replace, due to the highly skilled nature of the workers and the difficulties of getting workers to remote mining sites. Furthermore, due to the high visibility of the mining industry in Chile, the mining unions are more politically influential than any other. 

According to a former minister of mining, “Codelco [the state owned copper miner] and Antofagasta are the most emblematic mining companies in Chile. Other mining companies generally follow their example of operational management and how they negotiate with their unions.”

A senior executive in Codelco agrees, “The most politicised unions are those of Codelco and Antofagasta, partly due to the fact they hire many workers from all over the country. Those companies that hire local manpower are less politicised.”

“The most politicised unions are those of Codelco and Antofagasta.”

Senior executive, Codelco

A recent wage dispute could lead to a strike at Antofagasta’s Centinela mine. In late November, the Minera Esperanza union entered government-mediated negotiations after failing to reach an agreement with the company. Last week, the majority of Minera Esperanza members agreed a 36-month contract deal. However, another of the mine’s unions, Centinela District, continues to negotiate, keeping the threat of a strike alive.

A high copper price usually contributes to the inflexibility of the unions but a mining executive in Chile expects negotiations to be more amicable for the next six to twelve months, “The unions are weaker as a consequence of high unemployment rates, the uncertainty created by a second wave of COVID-19 and a high degree of political uncertainty.”

“The unions are weaker as a consequence of high unemployment rates, the uncertainty created by a second wave of COVID-19 and a high degree of political uncertainty.”

Mining executive, Chile

A board director of a Chilean mining company, believes that the high visibility of the constitutional process has motivated political parties with more influence (and visibility) around the constitutional negotiations to maintain a low profile on other issues.

Those unions belonging to the most extreme sectors and those traditionally related to dark movements, will seek to avoid an image of confrontation and aggressiveness, so as not to set a negative precedent to constitutional negotiations.

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