Venezuelan Government Incorporates 1,723 Subcontracted Workers into Sidor, Nationalises Companies

A further 1,723 subcontracted workers are to be incorporated onto the state payroll in Venezuela´s nationalised steel plant Sidor, Venezuelan Vice-president Elias Jaua announced on Friday. He further confirmed that two other companies, Grafitos del Orinoco and Sidetur, will be nationalised by the end of the year. 


Guyana City, December 19th 2011 (Venezuelanalysis.com) ­ A further 1,723 subcontracted workers are to be incorporated onto the state payroll in Venezuela´s nationalised steel plant Sidor, Venezuelan Vice-president Elias Jaua announced on Friday. He further confirmed that two other companies, Grafitos del Orinoco and Sidetur, will be nationalised by the end of the year.

The announcement, made in the presence of a gathering of Sidor workers in Caracas, was greeted by applause and jubilation by the subcontracted workers.

Jaua stressed that the gains made by subcontracted workers in being included within the more generous collective contract with the state should not be attributed to one individual, but are “the achievement of a collective, of a people who know how to make a revolution and do it with a leader like [Venezuelan President] Hugo Chavez”.

Further, a central commission is to be established that will examine the incorporation of the remaining 2,200 subcontracted Sidor workers. Jaua explained that workers not directly linked to the production process may not be incorporated, but would be offered “dignified work” by Venezuela´s new Knowledge and Work mission to be launched next year.

Friday’s announcement means that a total of 6,370 subcontracted Sidor workers have now been incorporated onto the state payroll since 2008, with the majority of the remaining cases to be analysed by the new central commission in the first quarter of 2012.

Ending Subcontracted Labour

Subcontracted workers are those contracted by private companies to work alongside state employees in nationalised enterprises such as Sidor, but enjoy less benefits and are paid up to four times less for performing the same work.

At the meeting on Friday, Jaua claimed that the creation of a double ­ tier workforce is rooted in the neoliberal policy of privatising state companies in the 1990s, in which “the first victims were the poor and the workers”.

Sidor, situated in the Guayana region of heavy industries in the east of Venezuela, was privatised in 1997 by Venezuela President Rafael Caldera, the year before Hugo Chavez was elected to power. According to information supplied to Venezuelnalysis.com by Sidor union activist Jesus Pino, during the decade of privatisation 1997 ­ 2008 the number of workers enjoying the direct collective contract with Sidor was reduced from 11,000 to 5,000, while up to 9,000 subcontracted positions were created.

After a 14 month struggle between workers and management over collective contracts, Chavez responded to workers’ demands and announced the re­nationalisation of Sidor in April 2008. A key clause of the nationalisation agreement obliged the Sidor to gradually incorporate the subcontracted workers as full state employees, ending outsourced labour.

This process continued according to a set timetable, and by mid 2011 4,647 subcontracted workers had been reincorporated.

However, accusing Sidor management of incompliance with the stage of incorporation of workers in September this year, the subcontracted workers union, the Bolivarian Movement, launched a series of actions in protest, including seizing an administration building, and blocking the main highway to Guyana City for 32 hours in mid November.

These protests resulted in the formation of a commission to resolve the dispute, with representation from the Bolivarian Movement, Sidor president Carlos D’ Oliveira, and Minister of Basic Industries and Mines José Salamat Khan. The commission agreed on the quickest possible incorporation of the September wave of subcontracted workers, and a revised timetable for the rest.

However, on 5 and 6 December a group of subcontracted workers closed down the section of the Sidor plant producing steel rods and bars to further increase pressure on Sidor management and the government. This was a particularly sensitive move because Sidor´s products are central to the government´s mass housing mission (GMV) launched in April this year, which aims to build over 2 million 700,000 homes by 2019.

Representative of the Bolivarian Movement Hugo Bastardo, who had organized the highway closure a few weeks before, claimed that the subcontracted workers behind the plant stoppage did not represent the union, and that the move was an act of “internal sabotage”. “The protesters demanded their insertion into the company without taking into account that a timetable exists”, he stated.

Meanwhile the head of marketing in Sidor, Nestor Astudillo, opined that the moves were part of a plan to take advantage of the incorporation issue to destabilise the plant among a faction oriented with the opposition, exacerbating labour conflicts and jeopardising supplies to the house building program, especially given that 90% of the products from this section of the plant are destined for the program and state construction.

The stoppage was resolved after dialogue was opened between the workers and Sidor president Carlos D’ Oliveira.

Hugo Chavez later commented on the dispute, declaring that the subcontracted workers “have to know that they can count on me, but they can´t ask me to arrange with the stroke of a pen what occurred over so many years,” and maintained that subcontracted labour had to be eliminated in the country.

Following Friday’s announcement, subcontracted labour in Sidor should be almost ended during the coming year.


On Friday Jaua also announced an order from President Chavez for the nationalisation of Grafitos del Orinoco and Sidetur, two companies key to the steel production process. The move aims to ensure the production of construction materials needed for the GMV, and for the workers signifies “a great commitment with the Venezuelan people”, Jaua declared.

The 70 workers at Grafitos del Orinoco in Guyana have been hoping for nationalisation in order to secure their model of worker control that they have developed since the government awarded them ownership of the factory in October 2009, after an 8 month struggle against the former boss.

“We workers celebrate the President´s decision of constructing this victory [of the worker control model], of the workers and the working class”, related Karlos Rondon of the Grafitos factory to Venezuelanalysis.com in response to the decision.

Meanwhile the Sidetur company, with over 1,800 workers and factories situated in various cities in the country, produces 40% of the cables used in Venezuelan construction.