Our partner Jorge Arredondo spoke with Diario Financiero following the recent statement by the Labor Directorate (DT) on the validity and extension of the so-called “framework agreements.”
The discussion was triggered after the DT pointed out that the agreement signed by the CTC, AGEMA, and Codelco is an “atypical” collective agreement that must be respected by the associations that signed it.
The possibility that the government will present a bill introducing multilevel bargaining is keeping all stakeholders in the labor market on their toes. That is why the trade union and business worlds, as well as lawyers specializing in this area, are keeping a close eye on any developments that could be a sign in that direction. This was the case with the recent decision by the Labor Directorate (DT) on the validity and extension of so-called framework agreements, a concept that covers various matters agreed upon by employers and workers and is especially used in sectors such as mining and forestry.
The starting point was the DT’s statement supporting the agreement signed in 2022 between the Confederation of Copper Workers (CTC), Codelco, and the Trade Association of Entrepreneurs for Mining and Related Industries (Agema), describing it as collective and atypical with binding effects for the parties, that is, it must be complied with “in good faith by the collective subjects involved in it.”
Otherwise, the agency added, “it could imply an attack on freedom of association,” since for the purposes of its achievement, the right “of representation by the directors of the trade union organizations has been exercised and, as a result, the right to collective bargaining has been freely realized between the parties.”
The decision drew criticism from former Labor Minister Nicolás Monckeberg, who accused the agency in a letter published by Diario Financiero of “pushing the country toward de facto branch bargaining in the world of copper contractors.”
‘Although this is an agreement signed by a trade union confederation and a trade association, its effects fall on companies—many of them SMEs—and workers who never sat at that table but who legitimately aspire to be suppliers to Codelco,’ the former official questioned.
The effect
Could this type of agreement be interpreted as a branch negotiation? There are different interpretations among experts.
“Article 408 of the Labor Code, cited in the ruling, expressly recognizes this type of agreement. Notwithstanding the foregoing, what I find unclear in the ruling is the scope and enforceability of such agreements,” said Cristóbal Raby, partner at Estudio Prieto Abogados.
“If the intention is to make it applicable to an entire sector or contractors of a particular company, then we will effectively be faced with a branch negotiation legislated via ruling,” added the lawyer, who added that “no company can be imposed working conditions with respect to which those companies did not agree. Another thing is if it is the main company itself (in this case, Codelco) that requires its contractors to adhere to these framework agreements,” added Raby.
For Jorge Arredondo, a partner at az, the discussion surrounding collective instruments regulated by the Labor Code and those entered into by virtue of freedom of association and the autonomy of the contracting parties, such as framework agreements, has been going on for quite some time. However, he said that the courts have been recognizing framework agreements. “Our own case law has recognized the validity of an atypical instrument,” he noted.
In fact, the courts have ruled on more than one occasion that agreements on remuneration and working conditions signed between the parties constitute bilateral, collective, atypical legal acts, in that they do not correspond to either a collective agreement or a collective bargaining agreement, nor are they regulated by the Labor Code. ‘Consequently, as with any contract of this nature, its effects, rights, obligations, and validity correspond to what has been expressly agreed upon by the parties,’ the court has stated.
Full support
The former Director of Labor, Pablo Zenteno, supported the service’s actions and rejected Monckeberg’s criticism. He argued that the DT’s ruling simply provided legal certainty to the workers’ associations that participated in the agreement.
‘The DT is doing nothing more and nothing less than that and, in that sense, it establishes what the effects of this agreement would be, from the point of view of the parties, from the point of view of their obligations, and from the point of view of current regulations. This does not seem, in any case, to be a covert reform, nor does it recognize a branch collective bargaining model, far from it, but simply limits itself to establishing what the requesting party in this case was requesting.”
For Álvaro Domínguez, Doctor of Law and associate professor in the Department of Labor Law at the University of Concepción, Monckeberg’s criticisms are “exaggerated and lacking in rigor, far removed from what one would expect from a former Minister of Labor. His interpretation is far removed from the doctrinal thesis that academia has been seriously developing, and also far removed from the jurisprudential line that recognizes framework agreements as atypical labor agreements protected by collective autonomy.
Similarly, Karla Varas, professor of labor law at the PUCV, argued that the DT’s action is to recognize that the actors in labor relations and workers’ representatives ‘can engage in negotiations and that the channels for negotiation are not only those expressly regulated by the legislature. Therefore, there can be direct negotiations. The DT is not going beyond recognizing that there was indeed social dialogue here. Agreements were reached, and those agreements must be fulfilled in good faith.’
Sergio Gamonal, an academic at Adolfo Ibáñez University, offered a similar interpretation, adding that “the Constitution expressly establishes union autonomy, and Article 1 of the Constitution establishes the autonomy of intermediate bodies. Therefore, an employers’ trade association and one or more trade unions, federations, or confederations can agree on whatever they want, unless it is illegal,” he explained.
On this point, he added that Article 314 of the Labor Code recognizes informal negotiation, a type of negotiation that is voluntary, direct, and not subject to procedural rules, to agree on common working conditions and remuneration for a specified period.
In addition, he said that there is also Article 408, which establishes that federations and confederations may, at any time and without being subject to procedural rules, upon agreement with one or more employers, or with one or more employers’ trade associations, sign collective agreements and/or agreements on special working conditions.
