Mérida, August 26th 2009 (Venezuelanalysis.com) – The Venezuelan government announced it will mediate a labor conflict at a Mitsubishi plant in Anzoategui state. The managment closed the plant indefinitely on Monday, citing labor unrest and low productivity, while workers protested against unhealthy labor conditions, and the Venezuelan Labor Inspectorate ruled the closure illegal.
According to Minister for Science, Technology, and Light Industries Jesse Chacon, representatives from the Ministry for Labor and Social Security will serve as mediators along with other government officials.
"We are attempting, or acting in good faith, to achieve a resolution, because our desire is that the sector functions well," said Chacon on Tuesday. He added that the conflict is "an internal problem between the employer and its employees," and "must be resolved by them."
Also on Tuesday, the Labor Inspectorate, which is an entity of the Labor Ministry, called the plant closure an illegal "lockout" and a violation of the workers' collective contract, and ordered the reopening of the plant within 48 hours and the payment of lost wages to the workers.
The company management based its decision to close the plant on "the very low output of our operation in addition to the high level of absenteeism, indiscipline, aggressiveness, and anarchy conveyed by a group of workers."
Production at the plant has dropped from fifty-nine vehicles per day to thirty-three per day over the past five years, according to the management. This decline of nearly 50% is consistent with the decline in Venezuela's automobile sector as a whole, which has been hit hard by the world economic downturn.
While the management attributes the drop in productivity partially to the reduction of government-issued dollars at the preferential exchange rate for imports of raw materials and parts, Chacon said the government has fulfilled its obligations to Mitsubishi. "We came to an agreement with [the Mitsubishi management] to guarantee assembly this year, we agreed on $2 billion between July and December 2009, and this agreement is being fulfilled," he assured.
The Association of Mitsubishi Dealers and the Federation of Associations of Distributors of Auto Motors and Machinery both announced that their inventories will last two months if the Mitsubishi conflict is not resolved, according to the Anzoategui regional newspaper El Tiempo.
Labor Union Response
The plant closure directly affects 1,848 workers at the plant, and indirectly affects more than 7,000 workers across the country, according to the main workers union, Singetram, which stands for New Generation Mitsubishi Workers Union.
Felix Martinez, the general secretary of Singetram, said the company has failed to meet its obligations to the workers in terms of wages, improved labor conditions, and the treatment of workers who become sick on the job.
In a deal mediated by the Labor Ministry following a two month strike and worker occupation of the plant during which state police killed two workers last March, the workers agreed to produce sixty vehicles per day if these and other conditions were met.
Singetram marched to the Labor Industry branch office on Wednesday to "demonstrate that we are willing to dialogue with the entities of the state. We do not promote the closure of [the Mitsubishi plant]; we want everything to be resolved in a peaceful manner," said Fernandez.
The workers accused the Mitsubishi management of using its government-issued dollars, which are traded at the preferential rate of 2.15 bolivars to the dollar, to purchase vehicles in Colombia and sell them for a profit in Venezuela, rather than for technological upgrades and imports.
Auto worker unions in Venezuela have also drawn attention to the gradual conversion of the unionized workforce into non-unionized contract labor through the closure of twelve auto parts factories in the sector in recent years, "before the government institutions' eyes and without any type of action to counteract it."
Labor leaders from Ford, Chrysler, Toyota, and a series of auto parts manufacturers and service providers in Venezuela signed a joint statement on Tuesday opposing the closure of the Mitsubishi plant, and organized an emergency meeting on Wednesday to support the Mitsubishi workers.
"The automobile industry workers decisively reject the owners' lockout carried out by the Japanese transnational Mitsubishi," said the statement. "What is important to them is productivity more than resolving the serious problems which afflict the workers."
More than 1,000 workers have become sick on the job and are lacking treatment in the country's five principle car manufacturers, according to the group of labor leaders. "These risky conditions are due to the owners' lack of investments in technology," the statement asserted.
The statement also denounced the "ferocious media offensive against the workers," and said, "The management pretends that the workers will renounce our constitutional and legal rights to obtain socio-economic improvements, and that we renounce the struggle for better health and working conditions."
Fernandez compared the closure of the Mitsubishi plant to the management-led shutdown of Venezuela's oil industry in 2002 and 2003, which was aimed at toppling the socialist government of President Hugo Chavez.
"In actions contrary to the revolutionary process, [the management] wants to do in Mitsubishi what they could not do in [Venezuelan state oil company] PDVSA: Destroy it," Fernandez declared. "We call on the population of Anzoategui to be on the side of the workers and not be deceived by what the transnational says."