(Adds detail on legal provision, comments from worker, analyst)
By Felipe Iturrieta
ANTOFAGASTA, Chile, March 23 The strike at
Chile's Escondida, the world's largest copper mine, is ending
after workers decided to invoke a rarely used legal provision
that allows them to extend their old contract, the union said on
Hours earlier, talks between the two sides failed, and
Escondida, which is operated by BHP Billiton ,
said it would attempt to restart production. The workers said
they would present their decision to the government on Friday
and return to work on Saturday.
A swift restart of Escondida, which produced about 5 percent
of the world's copper last year, may bring some relief to the
Chilean economy after a strike that has lasted 43 days.
But there was little immediate effect on copper prices
, with industry experts saying the two sides will still
have to tackle major issues in 18 months, when talks must
The stoppage by the union's 2,500 workers began on Feb. 9
after initial talks with the company to set new wage and benefit
contracts failed. Negotiations take place when the former
contract expires, typically every three to four years.
The legal provision, Article 369, allows workers to revert
to their previous contract for 18 months, after which both sides
must try to reach a new agreement. The company is legally
obligated to comply.
Returning to their former contract means workers will enjoy
existing benefits and working conditions and hold the next talks
under an upcoming labor law that strengthens their hand. But
they will also lose out on a bonus typically paid when the
contract is signed and on any pay raise.
"The money is important," a truck worker who requested
anonymity said outside the union meeting, "but the benefits that
we have fought for over years are good for us."
The use of Article 369 would be "complex" for Escondida,
mine President Marcelo Castillo said earlier on Thursday.
"Having collective talks in 18 months ... would require us
to revise our plan, our operating model, our structure in order
to allow us to make our mining business viable," he said.
BHP declined to comment further on the union's decision.
Throughout the dispute, the union has said it would not
budge on three key points: giving new workers the same benefits
as existing workers, maintaining current benefits and keeping
shift patterns from becoming more taxing.
Both sides see the uniform benefits issue as particularly
important. The new labor law that takes effect in April requires
a company to offer the minimum benefits in a previous contract
as the negotiating floor.
Industry veteran and analyst Juan Carlos Guajardo said he
thought Thursday's outcome of the dispute was "very bad."
"It just prolonged it for a year and half without resolving
any major points," he said. " ... This could affect other
Escondida is majority-controlled by BHP with minority
participation by Rio Tinto and Japanese
companies including Mitsubishi Corp. It produced
slightly more than 1 million tonnes of copper in 2016.
(Reporting by Felipe Iturrieta in Antofagasta, Additional
reporting by Gram Slattery and Fabian Cambero in Santiago;
Writing by Rosalba O'Brien; Editing by Chizu Nomiyama and Lisa