Trade Unions

  1. Recognition and Membership

Trade Unions are recognized in article 19 number 19 of the Chilean Constitution, as well as in the Chilean Labor Code.

Under Chilean union law, there are several types of unions:

  • company unions (all members are employees of the same employer);
  • inter-company unions (members are employees of two or more employers);
  • unions of self-employed workers;
  • unions of temporary workers;
  • federations;
  • confederations; and
  • workers’ centrals.

Unlike unions in the United States, in Chile, unions represent only those employees who are members.  Thus, more than one union is permitted in the same workplace. 

When a sufficient number of employees become members of a union at a particular company, a union is “formed” in that workplace and may negotiate with the employer for a collective labor contract covering its members.

The required number of employees must undergo specific formalities contemplated under the law. The formation of a union is a matter left entirely to the discretion of employees. An employer may neither interfere with its employees’ right to form and join a union nor require employees to form or join a particular union. Chilean law establishes a right on the part of each employee to join, refrain from joining, or withdraw membership from any union or labor organization, and membership in a union cannot be required as a condition of employment. A union may not engage in a strike or other economic pressure against an employer while organizing the employer’s employees. If organizing efforts fail, neither the union nor the employees must wait any prescribed period of time before again attempting to organize employees at the establishment.

The Labor Code does not provide a specific procedure by which an employer, an employee, or another union may challenge the formation of a union. The Labor Code does, however, authorize the Labor Inspectorate to object to the formation of a union during a 90-day period following the purported creation of the union.         

  1. Duties

Basically unions are meant to assist to employees on their labor rights with the correspondent employer, and in every activity stated in their bylaws that are not contrary to the law. Their main duties, among others are:

  • to provide mutual assistance to union members, to represent workers in collective bargaining;
  • to promote education and workplace security;
  • to monitor employer compliance with employment legislation and social security;
  • to provide various nonprofit services, including humanitarian services, for union members; and
  • to represent workers in the exercise of their contractual rights.
  1. Trends

The recently assumed Government has set a list of priorities and proposed changes in the Chilean labor legislation.

One of the matters that may experience changes refers to the promotion of the capacity and autonomy of the parties to negotiate in equal conditions in a collective bargaining. As a consequence of the aforementioned the proposal has been to strengthen union activity and collective bargaining, in order to better balance the labor relationship between employers and employees. In order to do that, the power of bargaining that the unions have inside the company will be increased to other subjects (not only remunerational, but also those that have to do with specific work conditions, such as safety matters) and carry out several amendments to the collective bargaining process that increase the coverage of employees that may exercise the right to be member of a union and collectively bargain.

One of the main proposals is the regulation of the "multirut" (creation of several related entities -represented by their different tax identification numbers- which are intended as an obstacle to the numerical requirements to form unions). The purpose of this amendment is to consider all related companies that share a controller, provide similar products or services and have a common labor direction as a single employer.

In addition, another proposal is to extend the benefits of a collective agreement automatically to employees who join such union.

Additionally, the government wishes to promote and make it easier for employees to be educated in their labor rights, whether individual or collective.

Another proposal is to simplify regulated collective bargaining, granting more autonomy to the parties during the bargaining. In such sense, the government has expressed its intention to implement Agreement N° 87 of the ILO, therefore prohibiting replacement of employees during strike.

Finally, the government will seek to promote and facilitate union activities, for which it will regulate union permits by increasing them and making them a cost of the employers, particularly those permits that are related to labor education, union training and other activities of union work.