Chile: Chilean Labour Reform Now In Force

Last Updated: 13 April 2017
Article by Cody Mcfarlane

This month the new Labour Reform (Law No. 20.940) has went into force and a series of modifications to the Labor Code have been introduced which break down as follows:

  1. The Labour Code incorporated has norms of protection to avoid discrimination acts at the work place. In this regard, article 2 is amended, increasing the list of behaviors considered as acts of discrimination in labour matters.
  2. Employees may request an exceptional work shift to the Labour Office (Dirección del Trabajo). This is the system used in all mine site were workers develop their work 24/7 nonstop. The reform reduces this resolutions from 4 to 3 years.
  3. There is now a possibility of a 4×3 work shift (work 4 and rest 3) for those companies where more than 30% of the workers are part of a union.
  4. Some of the rules to incorporate a trade union organization have been modified. It is relevant to point out that the quorum of workers required to incorporate a union will be 8 in middle size companies, which are those with less than 50 workers, representing at least 50% of the work force.
  5. The rules on the election of inter-company trade union delegates are modified, as the number of delegates can be chosen according to the number of union members in the companies and the jurisdictions.
  6. The number of delegates is abolished in companies in which there are no trade union organizations.
  7. There are new norms that set out the obligation to have women among the unions directors.
  8. The different conducts that can be considered as anti-union practices have been broadened. There are now new behaviors that can be classified as anti-union practices.
  9. Book IV of the Labor Code, relating to collective bargaining, has been replaced on the following issues:

    • The right to negotiate has been extended for workers that are trainees.
    • Agreements on common working conditions have been created.
    • Mediation and arbitration have new regulations.
    • Replacement of striking workers has been strictly limited.
    • There is new regulation regarding the negotiation of casual workers, transients, intermediate unions and federations and confederations of workers.
  1. Several actions of the employer have been incorporated and are now considered as "unfair practices" in collective bargaining and will be sanctioned.
  2. The Fund for Trade Union Training and Collaborative Labor Relations has been created, which will be administered by the Ministry of Labor and Social Welfare. This fund has as its financial purpose pursuant to its projects, programs and actions related to union formation, promotion of social dialogue and development of labor relations between employers and workers.
  3. The Superior Labor Council, which has a tripartite and consultative nature, has been created. Its mission is to collaborate in the formulation of proposals and recommendations of public policies to strengthen and promote social dialogue and a culture of just, modern and collaborative labor relations.
  4. Law 19,886, which regulates the Administrative Contracts for the Supply and Provision of Services to the Estate, is amended granting a better score or qualification to companies that maintain collective agreements with the trade union organizations.

The Labour Reform has basically focused on collective bargaining. Currently, around a 9% of the work force in Chile belong to a union, so to most workers the labour reform will not have a major impact.

Among the new norms, the ones that will probably have the most effect, is the limitation to replace workers during strike. This could leave companies at a disadvantage during long strikes.

To illustrate the above, recently Minera Escondida, the biggest mine site of Chile, was on hold for 44 days due to the strike of their workers. The strike only ended because the union invoked a rarely used legal provision that allows them to extend their old contract. 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.

This means that the next negotiations will fall under the new labour laws. The new law offers the minimum benefits in a previous contract as the negotiating floor which will strengthen the hand of the union.

Unfortunately, the labour reform does not seem to focus on the economical problems that a hard negotiation may produce and instead incorporates new regulations that could possibly increase labour disputes. Our recommendation is to be proactive and create a strategy for all labour and union matters. This is particularly important for mid-size companies, who may not have the financial strength to weather a long strike.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions