The decades between the 1920’s and 1940’s saw the consolidation of the sector as American-owned industry and, as elsewhere in the country, the situation of organised labour began to change significantly with the promulgation of early labour legislation in 1924, particularly the Union Organisations Act (Law No. 4057). In addition, Chile’s politico, economic, and social development in the late 1920s and early 1930s, proved greatly beneficial for the development of copper workers as actors with national influence. The 1925 Constitution guaranteed ample democratic rights, the 1931 Labour Code established a solid system of industrial relations, and the state became the centre of inward-oriented economic activity particularly since 1938. Although copper mining was
not a state enterprise, early interventionist policies allowed copper to take over nitrate as main source of hard currency, tax, and employment.
Early Copper Unionism (1925-1950). The first union to be established in the sector was the Sewell and Mine Union (1925) in El Teniente. Braden workers organised three other ‘industrial’ (blue-collar) unions in El Teniente in this period: Rancagua Union (1925), Caletones Union (1926), and Coya y Pangal Union (1929). Anaconda workers formed two industrial and one ‘professional’ (white-collar) union in Chuquicamata: Industrial Mine Union and Plant Union (1930), and Union of Copper Employees (1931) respectively. Andes Copper workers at Potrerillos began to organise in 1932. Union organising in copper mining continued at a rapid pace throughout the 1930s, and by the end of the decade, copper workers had managed to organise nearly all the potential workforce (Barría, 1970). Copper unions established the National Mining Federation in 1938 (Federación Industrial Nacional Minera, henceforth FNM) aiming to group all mining unions including nitrate and coal. The FNM joined the CTCH shortly afterwards and, in line with the confederation, committed to the collective bargaining institutions of the 1931 Labour Code. Thus, collective contracts became for decades to come the main regulatory mechanism of life and work in mines and mining towns (Zapata, 2002).
The rapid organisation of copper workers and their acceptance of early industrial relations institutions did not mean of course that employers relaxed their repressive stance. As result, early copper unionism evolved into a militant industrial strategy heavily reliant on structural power. It was characterised by adversarial union-management relations built around collective bargaining and private sanctions. The content of grievances was linked to bread and butter objectives, and members were expected to mobilise periodically in order to force employers to give in to their demands.
The Second World War and its aftermath had severe consequences for copper unions. Chile, as most of Latin America, became part of the United States sphere of influence during the Cold War which impacted greatly on national politics. In 1946, the CTCH split into two rival confederations, one Socialist and another one Communist. Just two years later, the same coalition that had got elected and governed with the Communist Party expelled Communists from government and declared the party illegal. Chile’s version of McCarthyism, the infamous 1948 Permanent Defence of Democracy Act (Law No. 8989) or ‘Damned Act’ (Ley Maldita), inaugurated a new cycle of repression of
unions and union leaders, which severely affected and dispersed copper workers and their organisations between 1947 and 1951.
Road to Nationalisation and Classic Copper Unionism (1950-1971)
The Second World War also had important consequences for the relationship between the state and the industry. The conflict brought an unprecedented high demand for copper, a key element in the manufacture of military equipment. However, before, during, and after the war, the American government controlled the commercialisation of copper, fixing its price at artificially low levels. Chile lost huge amounts of revenue, and consensus grew stronger on the need for the state to increase control over mineral resources.
In the early 1950s, the state began taking the first steps toward increasing control over the copper industry. The 1951 Washington Agreements between the Chilean state and the American companies allowed the former to control 20% of copper production (CODELCO, 2006). Complementarily, Law No. 10225 of 1952 allowed the Central Bank to purchase and sell the totality of copper production. A Ministry of Mining was created in 1953 (DFL No. 16 and DFL No. 231) and in 1955 the government announced the New Deal Act (Ley del Nuevo Trato, Law No. 11828), a new legal framework that would regulate the relations between the state and copper companies through lower taxes in exchange for increases in production. The Copper Department (Departamento del Cobre) was created in the same year as the state agency with the authority to oversee and participate in copper international markets (CODELCO, 2006).
Increasing state intervention in the economy was consistent with inward-oriented development, and in this context, the state’s approach to unions moved from repression to incorporation in economic development, particularly in strategic sectors. Copper workers became acutely aware of their structural power within the Chilean economy and in order to tap effectively on this source of bargaining power, they began a process of re- unification which led to the illegal establishment in 1951 of the National Confederation of Copper Workers (Confederación Nacional de Trabajadores del Cobre, henceforth CNTC). Just a few months after its foundation, the CNTC led a successful industry-wide strike, and was able to obtain significant gains from employers and the government. Within a few years, the CNTC had consolidated its structure and became an important national-level actor. Objectives related to the defence, strengthening, and
institutionalisation of the trade union as organisation, progressively began to supplement its previously nearly exclusive economic grievances.
Copper unions obtained special privileges from the state, increasing their associational power significantly. Notably, the 1955 New Deal Act mandated a commission to design a body of law ‘with special norms that would regulate work and relations between capital and labour in La Gran Minería’ (Law 11828, art. 22 cited in Barría, 1970: 18, my translation). As a result of this mandate, the government promulgated in 1956 the Copper Workers Statute (Estatuto de los Trabajadores del Cobre, Decree Law 313). The Statute legalised the CNTC, granted copper miners some economic concessions, included regulations of working conditions in the mines, indexation of salaries, and other measures to stimulate companies to invest in social housing and other social activities. More importantly, the Statute established a special industrial relations framework for copper mining (Barría, 1970). By the mid-1950s, union density in the sector was well above 60% on average, second only to the state-owned sectors of gas, water, and electricity (Agacino et al., 1998). The New Deal, the Copper Workers Statute, and the CNTC singled out copper workers as special actors within the labour movement and in their relations with the state. With the state becoming the main intermediary between the now industry-wide unions and their transnational employers, copper workers’ main challenge in this period was to access and put pressure on the state. It is within this institutionalised framework that Chile’s ‘classic’ copper unionism began to emerge.
Classic Copper Unionism. With this I mean to refer to the nature of union strategy and industrial conflict that characterised copper mining between the 1950s and early 1970s. While early copper unionism was characterised by adversarial collective bargaining between individual employers and trade unions, the now legalised CNTC became the unique bargaining force across all major copper mines. The government –now the central purchasing and commercialising power for copper and industrial relations arbitrator- became a central industrial relations actor. The CNTC would put pressure on the state to intermediating between the unions and their transnational employers. It did not take long however for the CNTC expected to access and bargain directly with the state, bypassing individual employers, and political strategy began to supplement industrial strategy. Copper unions developed a strong clientelist relationship with political parties, in which
the latter provided for an effective vehicle for accessing the state in exchange for securing electoral positioning among the rank-and-file (Zapata, 2002).
Clientelism is crucial not only to understand the mechanics of the sector’s highly institutionalised industrial relations system, but also the various illegal and violent strikes that overwhelmed it periodically (1938, 1940, 1942, 1951, 1966). As Zapata (2002) has shown, the nature of industrial conflict in copper mining has been one of ‘pure and simple unionism’ rather than a heavily ideological one. Although mass strikes had political connotations, these did not imply an alignment of union and party objectives. Indeed, the content of copper workers grievances has largely been linked to the defence, strengthening, and institutionalisation of the trade union as organisation (fuero, indexation, collective bargaining regulation), rather than to implementing the ideologically informed positions of political parties. Last, their integration with the rest of the labour movement was limited. This included relations with the FNM and CUT in which the presence of the CNTC, though active, was neither committed nor prominent enough. Classic Copper Unionism in its mature form would become largely political, and relations with the state and political parties represented an equal or more important sphere
of union activity than relations with individual employers and members.17
In 1964, the Christian Democrats won the presidency and announced a US$ 500 million expansion programme (Convenios del Cobre) which included the doubling of output to more than one million tons by 1970, substantial government participation in copper production and exploration, the tripling of Chilean copper refining capacities by 1970, considerable state control over sales, and the opening of all world markets (including the Soviet Union) to Chilean copper (Gedicks, 1973). The CNTC demanded to participate in the elaboration of such policies with little success although it achieved a series of salary increments and social benefits after calling major strikes and bargaining directly with the state.
In 1966, the government promulgated the Chilenisation Act (Law 16425), a radical new economic policy in agreement with copper companies, and reformed the Copper Workers Statute. The Chilenisation Act permitted the creation of mixed societies between the state and foreign companies. In 1966, the state purchased a 51% controlling interest in Braden Copper and committed itself to the expansion of El Teniente, while Kennecott retained managerial decision-making authority. Chile reduced the tax rates on the companies as well as providing a 20-year guarantee on these tax rates. Although the
original 1964 agreements did not include Chilenisation of Anaconda but rather Anaconda agreed to expand its output by 53% between 1965 and 1970, by 1969 the state had acquired a 51% interest in the two largest Anaconda mines: Chuquicamata and El Salvador (Gedicks, 1973). The Copper Department was transformed in 1968 into the so- called ‘Copper Corporation’ (Corporación del Cobre, Law 16425), a state agency to manage the production and commercialisation of the Chileanised copper mines.
In contrast to the extended and romanticised view of Chilenisation process, the high prices paid for overvalued companies, excessive tax reductions, and meagre increases in production output, meant that American companies, and not the Chilean state, were better off after the deal. ‘Hanson's American Letter’ used by investors in the US summed up the results of Chilenisation as follows: ‘No government of the extreme right, in an agreement previously signed, had ever dealt with North American firms with the kind of generosity shown by the Frei government. Its excessively favourable treatment lacked so much balance and justice and was so, so prejudicial to Chilean interests that it almost provoked
hilarity in Washington’ (Gedicks, 1973: 13-14).18
The Chilenisation process ended in full nationalisation on 11 July 1971 when President Salvador Allende achieved solid congressional approval to take over La Gran Minería. Congress voted unanimously to amend the 1925 Political Constitution, allowing the state to nationalise the properties of the three largest copper companies in Chile: Anaconda (Chuquicamata and El Salvador), Kennecott (El Teniente), and Cerro Corporation (Andina), the latter having started operations in 1967.
The 1971 Large-scale Copper Mining Nationalisation Act (Nacionalización de la Gran Minería del Cobre, Law No. 17450) allowed the state to legally expropriate La Gran Minería by abolishing the old colonial doctrine of ‘mining freedom’ (‘libertad de minas’), which recognised miners the right to treat their mines ‘as though they were their own’. The mining freedom doctrine recognised the state’s inherent authority over mining resources as a consequence of territorial sovereignty but prevent it to use or enjoy mining deposits which were owned by whomever discovered them (Ibáñez, 2003).
In contrast, the 1971 Nationalisation Act introduced a royalist doctrine of mining wealth (‘doctrina regalista’), which established the state’s patrimonial authority over mining resources (Ibáñez, 2003). Nationalisation allowed the state to decide the
organisation, operation and administration of the companies. It also established that the faculty to dispose of rights or to operate a mining concession could only be exercised on new deposits that were not already being mined or authorised by law. The nationalised companies began to be managed by ‘collective societies’ (sociedades colectivas), which were in turn coordinated by the state’s Copper Corporation.
The processes of Chilenisation first and nationalisation second were ambivalently received by copper workers. Although Allende was the official candidate of the CUT as well as of the Socialist and Communist Parties, copper workers had a series of conflicts with the Popular Unity government as well as with pro-Allende labour movement. Copper miners supported the political projects of the parties of the left as long as the latter were willing to support their grievances in the industrial relations sphere, largely ‘the defence of the union’ (‘la defensa del sindicato’), but clashed when these affected their prerogatives.
Nationalisation and Classic Copper Unionism within CODELCO (1973-1982)
Two years after the nationalisation of copper mines, a US-backed coup d’état installed General Pinochet’s in power. Political repression was particularly harsh against copper workers and managers of the nationalised companies. Numerous union leaders, Socialist and Communist members, as well as Popular Unity administrators -notably David Silberman, Chuquicamata’s Communist general manager- were among the thousands executed, imprisoned, tortured, exiled, and ‘disappeared’. Controlling copper miners and weakening their organisations was also attempted by eliminating the 1956 Copper Workers Statute as part of the 1978-79 new labour regulations.
Although one of the first actions of the dictatorship was to return all sorts of nationalised property to private hands, it did not reverse the nationalisation of La Gran Minería. Indeed, in 1976 the regime passed Decree Laws No. 1349 and 1350 formalising the creation of a state-owned mining company, CODELCO (Corporación Nacional del Cobre de Chile) that would integrate the nationalised companies in one large mining, industrial and commercial corporation (CODELCO, 2006). This was partly the reflection of the power of a substantial sector of the armed forces that identified with nationalist ideas. Keeping La Gran Minería in public hands was also a pragmatic political and economic stance due to the huge revenues obtained from copper, the enormous political importance of La Gran Minería, and CODELCO becoming the Armed Forces’ main
source of funding through the Confidential Copper Act which established that CODELCO would annually transfer to the Armed Forces the equivalent of 10% of its gross sales.
Classic copper unionism within a nationalised industry and CODELCO (1971- 1982). The transformation of the state into employer in its own right presented the copper labour movement with a new challenge, as the strategies for putting pressure on private employers and accessing the state as intermediary were no longer appropriate. Furthermore, the tensions associated with the state’s new role took a completely different shape during the Socialist government of Allende and the Pinochet dictatorship. Whereas the main challenge in the former case was incorporation, in the latter was repression. In both cases however, the predominant union objective was the defence of the union as organisation and the prerogatives of copper workers. In both cases however, what predominated was the defence of the union as organisation and the prerogatives of copper workers. As a result, Classic Copper Unionism began to evolve back into a largely industrial strategy.