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10 July, 2008
What has been the impact of Contract and Agency Labour Work in Brazil and Latin America?
The impact of outsourcing is felt in all sectors in Latin America. Of those sectors covered by the ICEM, it is probably the energy sector which has been hit hardest because of the mass privatisations in the 1990s. We are currently doing a study on the situation of contract workers in the energy sector to get more and better data on the present situation.
Subcontracting is everywhere. It is not limited to catering, or security, or transportation. It now goes right to the core of business in most companies. Oil companies subcontract maintenance, development, even production in the refineries. And, of course, at many companies, contract workers are involved in drilling and on offshore platforms.
ICEM Latin America/Caribbean Vice President Sérgio Novais
Has outsourcing caused a general trend of reduction in the salaries and benefits of permanent workers?
Outsourcing has led to a drastic reduction of salaries and in secondary benefits, since many workers go uncovered by collective agreements. Another aspect is health and security, in spite of the fact that, on paper, when we are engaged in dialogue with the bigger companies, everything appears fine. But in reality, we find many situations where there is a lack of proper training and adequate equipment. The proof comes in the fact that the highest number of fatalities, particularly in the energy sector, occurs among contract workers.
Are contract or agency workers more difficult to reach in terms of organizing?
The increase of contract and agency workers on any particular job makes the work of unions very difficult. When jobs are outsourced, you inevitably lose a number of full-time, permanent workers. This, in turn, makes negotiations that much more difficult. And then there also is the difficulty to contact and gain access to contract workers. And when you do, they are not always interested in joining an organisation that enters into a dialogue and negotiate with their company.
So, it places pressure on representation and that, in turn, places a diminished capacity to mobilize contract or agency workers toward the union. And in some cases, at least in Brazil, it makes trouble for the central unions, because workers might be represented by other unions who negotiate at different times with different agendas.
What is it like dealing with a primary company over subcontracting? What kind of legal challenges does it present?
Brazil is one of the countries where a primary company can be held legally responsible for the violation of labor laws by a subcontracting company. And indeed, sometimes primary employers are taken to court over infractions by a subcontractor. But this always occurs after an accident, or after an instance of polluting has taken place, or after a labour infraction has occurred. Further, it is only case by case, so it doesn’t solve the bigger problem of regulating and making an employer accountable on the front end.
What would you say on networking between unions, or sharing information on contracting practices? How important is that for success?
The consequences of the increase in use of contract and agency labour, and outsourcing in general, can be managed better if unions start cooperating. Creating national and international networks is important. We are making good progress with our regional BASF company network of labour unions, an ICEM network. The company has agreed that contract work is an important subject for permanent social dialogue. Imagine, the company recently admitted that even they didn’t know the number of contract workers present at any particular chemical worksite. We are now in a position where we are able to monitor the situation, learn from the monitoring, and hopefully pass this on to other BASF unions worldwide. It has also vastly improved our discussions with this particular company.
There has been a steep reduction in contract workers at Petrobras due to union action. Can you explain what was done?
This is another good example. Being a state-owned company, Petrobras, as a primary employer, was relatively easy to engage, particularly with a change of government in Brazil. It has led to better relations between the company management and the FUP, the national oilworkers’ federation. In a period of six years, this has resulted in a reduction of the ratio of contract workers to Petrobras workers from 4-to-1 to 2.2-to1. However, we’re not there yet. There are still many, many contract workers on oil rigs.
What are the next steps in Brazil regarding contract and agency labour?
Here in Brazil, we must find a way to get legislation adopted which enables contract workers to be represented by the majority union on any give jobsite. However, it is not likely this will happen with the current Parliament. Many Latin American governments have recently adopted legislation in one form or another on contract labour. The best legislation might be in Argentina. There, the Federación Argentina Sindical del Petróleo y Gas Privados managed to use it to negotiate that all contract workers are covered by the collective agreement.
What can you tell us about the upcoming Day in Latin America for Contractors?
On 28 July, we will campaign throughout Latin America to call for attention to the health and safety risks involved with subcontracting. The date has been chosen as a memorial to the 200 contract workers who lost their lives in Colombia while constructing a hydroelectric dam 25 years ago on this day. We will use this day as a regional call to all trade unions and trade union networks to include contract work in their agendas for dialogue and negotiation with the different companies.