Commodities | Jun 30 2008
By Greg Peel
Some 47 unions in Peru were preparing to strike at midnight on Sunday, Reuters reports, in order to influence the Peruvian Congress to approve a law which would eliminate limits on profit sharing. Mine workers have watched as Peru’s economy has boomed over the past six years, but say they are not getting a fair share of the profits.
Workers are expected to walk off the job at mines owned by Southern Copper, Freeport McMoran, Barrick Gold, zinc producer Volcan and tin producer Minsur, among others. Workers at the Casapaica zinc, lead and silver mine, and the Morococha silver mine, are also planning to block highways as part of the protest.
The federation of unions in Peru has twice delayed the start of a major strike this year in order to give Congress more time to discuss a bill which would lift caps on profit-sharing. The bill would affect some 85,000 workers. Peruvian president Alan Garcia has expressed his approval for the bill, but congressional leaders have been unable to reach a consensus.
Unions are also pushing for changes to early retirement rules, a reduced workday, and the right to enrol in state-run pension funds. Last year Peruvian unions twice went on strike to pressure Congress into restricting the use of non-union workers and to gain a greater share of windfall profits.
With energy and food costs soaring across the globe, worker frustration is likely to continue building in not only commodity rich areas, but in any area. Without wishing to question Peruvian mine workers rights to a greater spoil of the windfalls – Australian mine workers appear to be able to name their price – wage claims are the next step in a classic wage-price spiral. It was oil shocked high inflation levels and a wage-price spiral forced by powerful unions across the globe that ensured the 1970s was a decade of recession.