Labor Contract Signed, Nationalization Process Continues at Venezuelan Steel Plant

The United Steel Industry Workers Union at the recently nationalized SIDOR steel plant and the Venezuelan government finalized a collective labor contract early Sunday morning. Meanwhile, Sidor's former owner says it is still willing to negotiate the indemnity for the nationalization.

After marathon negotiations, Steel workers in recently nationalized SIDOR achieved a collective contract agreement that union leader José Meléndez (second from Left) called "a great triumph." (Aporrea)

Mérida, May 6, 2008 (– The United Steel Industry Workers Union (SUTISS), representing more than 4,000 steel workers at the recently nationalized SIDOR steel plant, and the Venezuelan government finalized a collective labor contract early Sunday morning. The deal brings to a close 16 months of negotiations ridden with work stoppages, fierce media campaigns, violent repression against workers, and the government’s nationalization, on April 9th, of Ternium, the Argentine conglomerate which had owned 60% of SIDOR since 1997.

“The workers feel that what we achieved was a great triumph,” said SUTISS Finance Secretary José Meléndez amidst celebrations in the streets of Guayana city, where the steel plant is based. The contract, valid until the year 2010, is a “precedent” for workers nation-wide, and is one of the best in Latin America, according to Meléndez.

The workers “were inexhaustible… more intelligent than the management of the transnational and much more honorable than the sectors of the endogenous Right, represented by the ex-Labor Minister [José Ramón Rivero],” who backed the private management of the transnational, Meléndez recounted.

The contract guarantees an initial daily wage increase of 33 bolivars ($15.35) and two additional increases of 10 bolivars ($4.65) by 2009, and satisfies worker demands for back-wages, overtime pay, incentive pay, and paid vacations. It also doubles retirement pensions and guarantees that the company will pay for 90% of the health benefits of the retired, and 80% of the health care of active workers.

The part of the contract which gives SUTISS representatives “the greatest happiness” is the incorporation of 800 of SIDOR`s 9,648 non-unionized contract workers into the union immediately, and the commitment to solidify a plan within three months to gradually incorporate the rest, Meléndez said.

Meléndez vowed that the workers will now be dedicated “body and soul” to turning the steelmaker into a “pillar for the revolution on the path to socialism.”

The workers have already increased production at the plant, Meléndez claimed, which demonstrates that “when we, the workers, are treated like human beings, when our dignity is respected, we are capable of making enormous efforts in support of the revolution.”

However, Meléndez assured that the union will be “pushing for the workers to control the democratic management of the new SIDOR,” even if the company is owned by the government.

The sentiment was echoed by Marcela Máspero, coordinator of the union current Collective of Workers in Revolution (CTR), who told the union press Sunday that “the management model should be a product of discussion and the protagonistic participation of the workers… ALL THE SIDOR WORKERS,” including the entire body of contract workers.

In Máspero’s opinion, the inclusion of contract workers in SUTISS’s struggle has been insufficient so far. She asserted that the “segregation” carved by the private management’s promotion of non-unionized labor will persist as long as there are inequalities between the unionized and non-unionized workers.

The contract workers were not included in negotiations with the government until late April, when more than 2,000 of them, accompanied by SUTISS Press Secretary Juan Valor, partially paralyzed the plant and marched to demand a seat at the table. This action won the contract workers 5 seats alongside the 11 SUTISS representatives in the negotiations.

The issues at hand are “the type of socialism we want to construct,” and “who will be the protagonists” in the construction process, Máspero said.

With similar rhetoric, the new labor minister appointed since the nationalization, Roberto Hernández, expressed during May 1st ceremonies that the “unity of the working class is indispensable” in order to resist the “domination” sought by “United States imperialism,” whose goal is “incessantly to divide the working class.” The minister said this enemy will only be defeated by “the strength of the popular masses led by the working class.”

According to President Chávez, who met with the workers today to sign the final version of the labor contract, the workers and the government now share “the commitment that together, government, workers, unions, and communities have to convert [nationalized companies] into socialist enterprises.”

Chávez signed the official presidential decree nationalizing SIDOR on May 1st, but indemnity, guaranteed by Article 115 of the Venezuelan constitution, has yet to be determined.

If Ternium does not budge on its $3.6 billion appeal, Chávez said he will “expropriate” the company. This would force the company to sell at the price determined by the government, which is currently $800 million.

The path to this “expropriation” was cleared last week when the Venezuelan National Assembly ruled that the steel plant is a “public utility,” permitting Venezuelan courts to determine the amount of compensation.

Chávez emphasizes the company’s value as a strategic asset in the “process of national development.” In his weekly Sunday talk show Aló Presidente, he explained that “companies like Sidor offer stability to the Venezuelan productive process.”

The President of Ternium, Daniel Novegil, confirmed Sunday his willingness to continue participating in Sidor “even as a minority partner.” He told the Argentine daily Clarín that “we understand the decision in the political context of Venezuela… And we are willing to come to an agreement, always as long as the terms are just.” In contrast to Chávez, the Novegil insisted that market value determine the amount of compensation.