The Escondida mine, located in the Atacama Desert in northern Chile, will pay each of its workers a bonus of US$25,340, give them a 5 percent raise, increase their health and education benefits, and provide easy access to up to US$6,339 in loans. The union, which has roughly 2,250 members, voted to accept the offer with a 72 percent yes vote. The union contract was set to expire Dec. 5.
This latest concession by Escondida, which is owned by British/Australian mining giant BHP Billiton and produces 5 percent of the worldâ€™s copper, will almost certainly influence labor negotiations at other Chilean mining sites, including Spence, another BHP Billiton mine, and the Andina division of state-run copper company, CODELCO.
At Spence, where the workers are on strike, union leaders are demanding benefits above those won in Escondida. â€œWeâ€™re open to resuming the dialogue, but weâ€™re warning that we can afford to continue striking for months,â€ union leader AndrÃ©s RamÃrez told El Mercurio. He said that his union was not blocking access for workers or vehicles entering the mine.
Still, Escondidaâ€™s successes will not necessarily carry over to the other labor disputes, according to Juan Carlos Guarjardo, director of the Santiago-based Center for Copper and Mining Studies (CESCO). â€œI donâ€™t think itâ€™s possible to extrapolate the same numbers to all cases, but it will play an influential role in establishing a higher level of demands,â€ he said, pointing out that several mining contracts will end later this year, which puts the Escondida settlement at the center of the mining industryâ€™s attention.
Escondida workers fought for higher wages in 2006 as well, and, after a 25-day strike, won a bonus of US$16,290 and a 5 percent wage hike.
Copper has long been the lynchpin of Chileâ€™s economy. According to the Chilean central bank, in 2008 copper represented 42.49 percent of Chileâ€™s exports and 15.5 percent of its gross domestic product.
SOURCES: EL MERCURIO, CAPITAL, REUTERS, THE AUSTRALIAN