Workers’ Control in Venezuela Faces an Uncertain Future

Josep Maria Martorell looks at the prospects for workers’ control movements in present-day Venezuela.

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Workers of the INDORCA plant under workers’ control in east Venezuela. (Archive)
Workers of the INDORCA plant under workers’ control in east Venezuela. (Archive)
By Josep Maria Martorell Calaf
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Orinoco Industries (INDORCA) is one of the few companies under workers’ control in Venezuela and exemplifies the challenges faced by such companies, as well as their potential to help overcome the crisis.

It is a [steelworks] company without a boss, where everything is decided in an assembly formed by the 39 members of staff in full equality. At INDORCA everyone earns exactly the same, regardless of what work they do or their seniority. Economic management is visible to all through a large whiteboard in the meeting room, guaranteeing absolute transparency.

This is the result of more than ten years of struggle, of a journey that began with mass layoffs and the union organisation of workers, and which continued with a stubborn fight against partial justice, years of famine, boycotts, sabotage and mercenaries.

Its history, which is little known even in Venezuela, not only shows the reality of the few companies under real workers’ control in this country, but is also the starting point for innovative forms of non-commercial collaboration which looks to restore the national productive capacity. INDORCA is the scene of the first “productive battle” [of the so-called Productive Workers’ Army, see below]. Finally, it allows us to understand the complex relationship between the nationalisation of enterprises by the state and the experiences of real workers’ control, now under attack from several fronts.

INDORCA does not receive any aid from the State, as it is not a nationalised company. The workforce cling to Chavez's 2012 reform of the Labour Law which allows workers to directly manage a company that is fraudulently liquidated by the bosses. But it does so in an economic and political context very different to that which existed in Chavez's life.

A unique experience of struggle

INDORCA is a metalworks company in Guayana [Bolivar State], an industrial area in the east of the country dedicated to the export of iron, steel and aluminium which today offers employment to some 20,000 workers. The company makes all kinds of steel parts, automated and otherwise, from threaded parts to complex wellheads for oil extraction.

Victor Mujica is a turner and the current vice president, a member of the board by decision of the assembly. He tells of the firm’s complex history of struggle, which began with symptoms of divestment in 2008 and continued with two mass layoffs, the dismissal of all union members, a long series of lawsuits in which the legal system always settled in favour of the boss Oscar Giménez and, finally, the total suspension of wages in July 2012. It was then that the assembly decided to occupy the factory until they were paid.

During all this, the new Labour Law entered into effect in May 2012, which, at the request of the workers and in article 149 allows:

The occupation of a closed work entity and the restarting of productive activities (...). To this end, the employer, the workers and their social organisations shall be called for the installation of a Special Management Board.

Neighbouring [basic industry] companies Calderys and Equipetrol had already followed this path [of activating article 149].

When the courts ordered the eviction of INDORCA, the staff, supported by colleagues from Calderys and Equipetrol, disregarded the sentence and withstood successive police onslaughts.

For three and a half years, closed away in the factory and without pay, [the workers] survived by organising raffles, food and money collections from neighbouring companies, growing an orchard and raising goats. They even found food through an intense iguana hunt and alternated looking for small jobs outside of the factory, sharing the salary.

It was not until the arrival of Jesús Martínez as the new minister of labour [in 2014], a person committed to labour struggles, that they were able to set the date for the activation of article 149: March 23, 2015. But a fortnight before, an armed group stormed the factory, holding up the on-call workers and disabling the plant.

A leftist way out of Venezuela's economic crisis

That blow, which almost ended INDORCA's fight, marked the birth of the ‘productive battles.’

Workers from Calderys, Equipetrol and [Guayana based electrical parts company] Carbonorca were impacted by the ‘battle’ and, organized by people like Sergio Requena, came to INDORCA to repair the damage for free. It was this show of solidarity that allowed INDORCA to complete its struggle, and also meant the birth of the Productive Workers' Army (EPO), of which Requena is a prominent member.

Currently, with more than two thousand volunteers registered throughout the country, the EPO has already organized fourteen ‘productive battles,’ expeditions in which diverse professionals, free of charge and coordinated by the EPO, move to collectivised or nationalised companies in difficulties, repairing broken machinery or infrastructure that, for lack of resources, nullify or decrease the company’s productivity. The last intervention, which achieved the most media coverage, was in June 2019 to put the machinery of the ministry of tourism in Caracas, which employs about 2000 workers, into full operation.

Undoubtedly, this new experience, which is currently being consolidated in Venezuela, opens up a vast field of possibilities for the recovery of the national productive apparatus in the current context of crisis. This model, which is importantly linked to real workers’ control, evades the bureaucracy of the state. Coincidence or not, the EPO is currently being prevented from repairing the Caracas Metro and the University Hospital free of charge, two Caracas institutions with serious problems and of vital importance for the city's poorer sectors.

The reality of workers’ control in today's Venezuela

INDORCA, already collectivised, had two years of great success while Juan Arias was minister of industry and Sergio Requena was appointed president of [the State-run Corporation of Intermediate Industries] CORPIVENSA.

The two supported each other to strengthen the four companies under workers’ control in Guayana. In 2017, INDORCA achieved its first contract with a state-owned company, [Guayana aluminium firm] VENALUM: the workforce increased to 42. From CORPIVENSA, Requena fostered the dynamics of mutual support for the EPO and, as a result, 11 companies regained or boosted productive capacity.

But soon both [Requena and Arias] were dismissed. Firstly, this was because the model [they encouraged] left no space for bureaucracy, and secondly, because it encouraged workers to seize the means of production without needing capital or the state to back them. Thus, Arias was replaced by Tareck El Aissami - a criminologist lawyer without any experience in the sector - in June 2018, and, after a month, it was Requena’s turn.

INDORCA has not won a contract with a state-owned company since, and the benefits found in state-owned enterprises also dried up: the [subsidised food] CLAP box and medicines through [state-run medical distributors] Farmapatria...

Indeed, after Chavez's death in 2013, the crisis arrived and adjustment measures began.

The bourgeoisie, with the support of the United States, redoubled its offensive and, in the face of this, the approach of the [Nicolas] Maduro government was not towards full expropriation and economic planning, but towards policies of conciliation: lifting price controls and promoting the alleged revolutionary or patriotic bourgeoisie, to which many previously nationalised companies are being sold.

An emblematic case is that of the [supermarket] chain Exito, nationalised as Abastos Bicentenario in the times of Chavez but today [re-]privatized. Equally, in the agri-food sector, the Alba Rice Plant [has suffered the same fate]. We have also seen a return of land to large landowners, with peasants expelled from land which Chavez had given them under the 2001 Land Law. Since 2013, [the government] has also bet on an intensification of economic relations with countries such as China, Russia and Turkey.

This context of privatisation, growing bureaucracy and the national bourgeoisie, and encouraging transnational investment, is noted through the reversal of the few experiences of workers’ control that had occurred under Chavez. Some companies, which had become self-managed in accordance with article 149 [of the Labour Law], have become managed directly or indirectly by the state in recent years.

The UPSA La Gaviota canning factory is one of the companies governed by this article but where, currently, there is a majority of state representatives on the board of trustees. This is the same case as Smurfit Kappa's Petare plant, which had been a benchmark for workers’ control.

On the other hand, Maduro's government has long since halted expropriations with the intention of attracting investment. When an owner abandons a company, the government improperly applies article 149 to recover it, that is, it imposes a board of bureaucrats to manage it without the request from the workers, which makes the company still formally owned by the old boss. These state recoveries are projected as experiences of workers’ control without being so. This is the case in [hygiene products factory] Kimberly Clark and [cereal producer] Kellogg's, recovered in 2016 and 2018, respectively.

Today there is no record of the companies under real workers’ control in Venezuela, but everything indicates that we are talking about a dozen. The legal formulas that encapsulate them, however, are diverse.

The “Heroines of Aragua” textile factory, previously the Gotcha T-Shirts, fought to be recognized as a public utility and expropriated in 2004. It is governed by a factory committee composed exclusively of women seamstresses of the company.

[Ceramic producers] INTERCERAMIC in Lara State was abandoned in 2013 and managed to become a direct-owned communal company. Today it is EPSDC Alfareras del Gres and is accountable to the commune of that territory and not to the state. On the other hand, Alina Foods was abandoned in May 2015 and, with Jesús Martínez as minister, activated article 149 in October of the same year. It is currently resisting a nationalisation decree which was not consulted with the staff and which could replace the workers’ control. Finally, four [basic industry] companies from Guayana: Calderys Refractarios Venezolanos, Equipetrol, Minerales de Venezuela and INDORCA are all managed by a special management board according to article 149.

Expectations of workers’ control in Venezuela

In state-owned enterprises, workers take a wage, even if it is a small amount, regardless of production or even if the company is completely stopped for years by a breakdown. But companies under workers’ control are formally private: if they do not bill clients, workers do not get paid.

INDORCA does not receive contracts from state-owned enterprises. The large private companies of Guayana, on the other hand, support Oscar Giménez against his former workers and also boycott it.

So who does INDORCA sell to? Small Venezuelan private companies in the region and large transnational corporations. The latter accept orders from powerful state-owned enterprises and outsource some of these jobs to INDORCA, which ends up working for the state all the same, but in an outsourced capacity. These profits end up leaving the country thanks to new policies promoting foreign investment.

On the way to INDORCA, on one of the dusty dirt tracks, there is a large fenced plot. It is full of the most varied items: large stairs, silos, metal plates, steel beams... It is a new iron plant commissioned by the state. They have brought the entire factory, in pieces, from China. "Look, what do you see? These are stairs, silos... do you think all this couldn't have been done in INDORCA? And it would have been four times cheaper."

Not all views are so strong about the danger posed for the Bolivarian Revolution by the new international alliances.

Many see them as a phase in the sharpening of the struggle against North American imperialism and as the only way out, right now, against the ferocious blockade. Despite creating new vulnerabilities, these partnerships may objectively help reduce dependence on the ancestral poles, the US and Europe.

[Others argue that they constitute] a phase which must be used to gain sovereignty, to reinvest the rent income in the industrial, agricultural and technological development of the country.

But it would be naive to understand these agreements with Russia, China, Turkey or Iran as internationalist relations. The question is not simple, but in any case privatisations and policies of conciliation with the bourgeoisie, however patriotic, cannot be understood in the same way.

The current decline in workers’ control in Venezuela responds to all these factors. On the other hand, article 149 of the Labour Law describes workers’ control as an interim situation, it is not intended to define a permanent management system for a company.

This means that [the legal status of the board] has to be renewed every year with the ministry, periodically putting these projects at the mercy of the state bureaucracy.

The logical way out of this provisional situation seems to be nationalisation, but in this case, management is formally passed to the state and no longer belongs to the workers. Be that as it may, everything points to the view that, today, true worker control is not on the agenda of the Maduro government.

Josep Maria Martorell Calaf is a Caracas-based member of the Catalan Workers’ Trade Union Coordination (COS).

The views expressed in this article are the author's own and do not necessarily reflect those of the Venezuelanalysis editorial staff.

Translation by Paul Dobson for Venezuelanalysis.

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