Venezuelan Steel Workers to Vote on New Contract, Possibly Ending Year-Long Conflict

The workers and the management at Ternium Sidor, Latin America's fourth-largest steel plant will hold two separate referenda this week to assess worker sentiments regarding the company's final pay raise offer amidst a conflict over a collective contract that is now finishing its 13th month.
Workers belonging to the Sidor union SUTISS striking outside the steel plant, shortly before the possible end of a year-long labor conflict.

Mérida, April 1, 2008 ( The workers and the management at Ternium Sidor, Latin America's fourth-largest steel plant located in southeastern Venezuela, will hold two separate referenda this week to assess worker sentiments regarding the company's final pay raise offer amidst a conflict over a collective contract that is now finishing its 13th month and has produced eight strikes, violent repression and arrests by police and National Guard, and an estimated $50 million in company losses.

Sidor's final offer is to double worker wages to 44 bolivars ($20.50) per day gradually over the next four years. This is almost twice their original offer. The United Steel Industry Worker's Union (SUTISS) rejected the offer, demanding 50 bolivars ($23.25) per day among other benefits, significantly less than their original demand of 80 bolivars ($37.20) per day.

The referendum initiated by SUTISS is scheduled to begin at 11:00pm Tuesday night and voting will continue through 3:00pm Thursday afternoon, according to the SUTISS conflict committee.

"The workers decided that the union should carry out the consultation," SUTISS General Secretary Nerio Fuentes announced Monday, assuring that the union expects 4,000 workers to participate in the referendum, out of a total 5,400 permanent workers the company employs.

The company will hold its referendum either Thursday or Friday this week, according to news reports. Sidor Human Relations Director María Elena Posada told the press last week, "The time for negotiation, conciliation, and mediation has been exhausted…the legal option that we have is to consult the workers so that it is they who make the decision whether or not to conclude this conflict," adding that the company "is not interested in maintaining the conflict."

One reason for the separate referenda is that SUTISS objects to the way Sidor frames the issue in a way that forces workers to choose between the company's offer and more "conflict" and implies the union is at fault for this conflict. The union's referendum, in contrast, will ask if the workers approve of the company's offer or if they opt to "continue discussions."

SUTISS representatives said yesterday that its referendum is meant as an "answer to the media offensive that the company has carried out at a national level," in which they have implied that the "union does not want to consult its affiliates."

Sidor's most recent announcements, reported in the Venezuelan daily El Universal, indicate its referendum will offer workers Labor Ministry arbitration as an alternative to accepting the proposed pay raise.

However, the workers already rejected the Labor Ministry's proposal for arbitration in late February on the basis that it would have undermined union authority. SUTISS's suspicion that the government and company officials are teaming up against the workers was deepened when the national guard and police attacked and arrested striking workers in mid-March. SUTISS General Secretary Nerio Fuentes speculated the attacks were ordered by the government in retaliation for rejecting arbitration offers.

In a display of the union's mistrust of the company in this context, José Meléndez, the Finance Secretary of SUTISS, declared, "under these conditions no, we will not participate, not even to reiterate that we do not accept this raise. The company lies shamefully in its offers and we will not bend over in the struggle for a dignified collective contract."

In addition, SUTISS claims that the company and the government are attempting to impose the referendum on the workers without properly consulting with the union, thus violating Article 193 of Venezuela's Labor Law regulations.

Article 193 states that the company must provide the facilities, protection, and worker pay remittance in the event of a referendum and article 192 mandates that the Labor Ministry must gather all parties involved in the conflict to inform them of these duties and other procedures beforehand. If these obligations fail to be met, says the law, the referendum will be cancelled and the union will be considered a legitimate representative of worker opinion.

SUTISS leaders claim that since the company announced its plans for a referendum, the workers have not been consulted, which is why the union has initiated its own vote, to which they have invited the National Electoral Commission and Public Defender's Office to help monitor.

Last week, nearly 100 national worker unions met in Guyana City, the municipality where Sidor is based, and agreed to launch a national campaign to inform people about the Sidor situation and form local solidarity committees. A national workers' strike in solidarity with SUTISS received wide approval, according to Stalin Pérez Borges, National Coordinator of the union current Marea Socialista, who declared "it is the commitment of Marea Socialista that these resolutions do not remain simple declarations."

Monday, the Communist Party of Venezuela (PCV) called for an investigation of the conditions of Sidor's privatization in 1997, with the intent of re-nationalizing the Andean region's largest steel producer. PCV leader Yul Jabour said "The struggle of the [Sidor workers] is not only economic, but also social and political," and advocated that the lower-paid, less protected Sidor contract workers, who have grown in number since privatization, be included under a new collective labor contract.

Venezuelan President Hugo Chávez had threatened to nationalize the 60% controlling share of Sidor that is currently owned by the Argentine company Techint, in May 2007 if the company did not prioritize Venezuelan markets, but an agreement was reached to avoid nationalization. The government already owns the other 40% of Sidor.