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October 22, 2014
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Wage talks to be harsh, strictly on salaries

The head of the pro-government CGT Antonio Caló talks to Labour Minister Carlos Tomada at a meeting Wednesday.
By Federico Poore
Herald Staff

Sociologist Oscar Martínez talks to the Herald about the challenges of upcoming collective bargaining

The annual round of wage bargaining will be especially difficult this year, taking into account last month’s steep devaluation and the fact that the economy is expected to grow at a slower pace than in previous years.

Union fragmentation and their different stances toward the national government also add to the mix, sociologist Oscar Martínez, co-ordinator of the Workshop of Union Studies (TEL in Spanish) told the Herald during a phone interview.

What are the main issues regarding this year’s wage talks?

The first thing that needs to be pointed out is that the recent price hikes took working conditions out of the discussions, something that was beginning to appear in certain wage deals. Accords for the progressive elimination of precarious employment have been only a few, but were gaining momentum. But now, after the high inflation rates of the last months, there is a much bigger dispute, not only over wage hike percentages but also on the period of validity of collective agreements.

Do you believe it would be better for workers to be granted a six-month wage deal?

It begins to be vital. If you don’t define short periods (of validity) or explicit indexation mechanisms, there’s no safeguard in case inflation erupts. The annual wage hikes are a leap of faith.

Is there any chance of a struggle over wealth-distribution breaking out?

Argentine history shows that in this kind of contexts, unions agree to pay raises but business pass on those increases to prices — both before and after the hikes. In many cases, prices of goods that are not dollar-linked are also raised “just in case.” Unions are trying to seriously discuss this issue anew, at the same time that they push for government control throughout the entire production chain.

Do you believe unions will define their stance taking into account their pro- or anti-government position, or based on the real needs of each branch?

It’s a mix between both. For example: the CTERA (teachers’ union) is very pro-government, but the grassroots are pushing them to go for more. Another pro-government teachers’ union, SUTEBA, is also facing opposition within the union and will probably be forced to toughen their stance against their employers. It depends on the pressure from grassroots, but also on the sector of the economy.

Will the strategy be different for public or private companies?

Yes. Even within the public sector, it’s not the same for unions who have become highly visibilized, like teachers, than for municipal workers from the provinces, who have limited fire power. It’s the same for the private sector — some workers are rewarded with excellent salaries, like in the case of the aceiteros (edible oil workers), but others are earning very little. In those cases, there is a greater inflationary impact. Salary dispersion, a problem from the nineties, is still among us. There are metal workers from UOM still earning 5,000 pesos a month — and that is their gross income!

Is it possible for skilled workers to end up agreeing to a lower salary raise in exchange for an effective freeze on suspensions and dismissals?

We’re not in a recession yet, there are no big threats of firings or mass transfers. But other political deals can be struck: for example, deals that, on its face, are not very beneficial but that at the same time eliminate the lower categories or grant automatic category upgrades — like some big factories implemented.

Which unions are going to set a reference point for further discussions?

All teachers’ unions, the UOM headed by Antonio Caló, bank workers and maybe the UTA bus drivers’ union, whose wages are well behind. Obviously, we need to know how the teamsters’ deal ends up.

What will happen with grassroot unions in this context?

It’s hard to know. On the one hand, fear of inflation tends to paralyze their growth, but on the other the declining purchasing power of salaries tends to mobilize workers. If union leaders at both national or regional levels fail to achieve satisfactory solutions to this problem, the most combative unions win a space for themselves.

Do you believe it is inevitable for wage hikes to end up below this year’s inflation?

It’s an open scenario. Sadly, the government wants that to happen.

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