Summary of the Labor Situation • ID BOLIVIA . . . Office of Labor· Affairs Prepared by labor specialists assigned abroad, and for u.s. specialists who ·. will'meet.foreign participants in the program who are. 'visiting • • ' •. ·' ''f " .· . ' · the United States•.·, Despatches. and _reports from F~reign Service . Officers are the chief sources; others are official. publleations and press and.radio ~arts. ~· . ' ' ; ...·Unclassified · ·.. The Division of Foreign Labor >Conditions,. Bureau. ~~t..Labor ' c. -• ~ • ' -• ~ Statisti~, has prepared this series of summaries of the .labor situation in selected countries for the International Coopera. tion Adnrl n1 stration, Department or State. The purpose ·has been e ,-'' p~to provide baCkground material for the teclmical co -~ ,' . operation programs.·· for the ICA sta.1'£1 for u.s. trade. union and BOLIVIA ·-~ ·-~ BOLIVIA ·-~ ·-~ Ul'd.iRn into_the_natiQJl~__Jj,f_e_ot_ 'tii& countr:µ" . To end 'Bolivia1s_!!_~~~@.ee__on_tin_it__s:tart,ed_e._progr8lll of diversifying t.Q.~~-C.9I\9J\Y'__a -rrhe army was reduced in size in order to· ~end its perVasive.intluence ·in Bolirlan life. From 1952 to 1956 . political. opposition was generally suppressed and President Paz governed by decree. As its stability increased the Government relaxed controls, granted a general amnesv, and restored many civil and political. liberties and the functioning of comtitutional government. In the general. elections of 1956, the MNR, with labor support, won a resounding victory. Heman Siles Zuazo, Vice President under Paz, was elected President and MNR candidates won alJDost all seats in the Bolivi.an Congress. The major ei'forts of the Siles administration have been directed toward ending ~ation and 1 n restoMng_®_ooi~ona__suit,able__r_economic-growt}re-' -4 d. Economy Mining has dominated Bolivia's economic life as well as her politics. Formerly silver and now iiin have been the mains~s of Bolivia, and the countr,y has to bear the often extreme ups and downs of an econoJr\Y dependent upon foreign demand. Minerals have consistently constituted about ~rcent of exports and provided most o:r the revenues from taxes am tar.Lf'ts for the Government. Tin alone accounts for-6.0-Jpercent or the Talue or mineral production; other important minerals are zinc, lead, antimony, gold, tWlgsten, sulfur and oil. The nationalized mines (responsible for 80 percent of tin production) are operated by the govenment-controlled Bolivian Hi.nllg Corporation (Corparacion Minera de Bolivia -OOMIBOL). Although other mines, classified as small or medium, were allowed to remain Ullder private ownership, their exports and imports are handled by another Government agency, the Bolivian Mining Bank {Banco Minera de Bolivia). The tin indust17 is in serious straits. There has been a general decline in world tin consumption and the competitive position of Bolivian tin is precarious. The metal content of the ores is low and the richer deposits are nearly exhausted. The tin has to be transported long distances for .smelting. Investment has been insufficient 1io prevent existing equipment trom deteriorating, and virtually no ,\exploration am development has taken place. "Nationalization resulted in the loss of valuable foreign technicians, 11ho have been hard to ~~ce. Finally labor coll'ts are high, since t.he miDas are :forced to tain an excess labor force am are plagued by recurrent labor irnructa. The Government has placed great hopes on the development of oil resources to offset, decreasing tin production. Revenues from oil production have accounted primaril1" for the rise in gross output of extractive industries. Production is now sui'fic::tent to meet local needs am to allow small quantities ot exports t,o neighboring colllltries. The extent or oil resources, however, is unknown. A Government corporation, the Government Petroleum.Enterprise (Yacimientos Petroliferos Fiscales Bolivianos -YPFB) is the primary agency for developmental purposes. Foreign investment has been encouraged through the promulgation ot a nev petroleUll code, am foreign firms have been quick to seek concessions. ~2 percent of Bolivi.a's land area ie cultivated and hal.f of this is oillJierelatively unf'avorable Altiplano. Most activity is of a subsistence type. Agricultural techniques are rudimentary, and yields are low. The estimated thirty percent of the gross national product derived from agriculture is produced by over seventy percent of the labor force. Because of the insufficient agricultural development, considerable quantities of foodstuffs am raw materials are imported. The chief products are potatoes, quinoa corn (grain yielding sorghum), wheat, sugar, rice, cocoa, coca, and livestock. -5 Urxler the· historical. system of land tenure, the prevailing pattern .. was the large estate, owned by absentee landlords am cultivated ·by . Indian labor. The Indians were attached to. the estate, and in return :for the use or a small holding, were required to work . three or four. -·:· .. _, ; d~s a week on the owner's land as well as to provide personal services•. With the high concentration o:f .farm labor available, land owners made . '. few :financial out~s for farm.improvements, while the Indian labor had · little incentive to maintain a high level of production• .· .,. In line with its policy of. ninoorporating" the indigenous population into the economic lif'e o:f the nation, the MNR ;Government refC'"'.'med . the legal basis of :the land tenure system ~3._ Large estates were.. expropriated am, for the most part,· were turned into .small peasa.rrt" . ... '· holdings. The provision of personal services .was abolished. The . '.. reform decree has not yet been :fully implemented, aIXi much lmxi has yet to be distributed an::l titles insured. -So tar the effects of this transtor.uation have been mostly social arxl political, while the con-. fusion from such a change am the lack of an effective development policy apparently have contributed to a decrease in agricultural production. Because industrialization is still in its early stages, Bolivia has to depend to a very hig.l-i degree on imports for its manufactured goods. The contribution of manufacturing to gross national product is about 10 percent. Industrial expansion dates from the Chaco War :1 (1931-1935) mn has been especially stimulated by the short;ages cauaed1 by World War II and the Korean conflict, and by the high degree of ---1 protection a.fforded industry by the State. Industry is characterized by a marked predominance of small scale plants and production o:f the artisan tQrpe. The predominant forms of organization are the proprietorship and partnership. Activity is centered on the production or consumer goods, and is carried on mai~ in the cities o:f La Paz and Cochabamba. Textile manufacture and the processing of :foodstuff's account for over three-fourths of the value o:f factory output. Other important products are building materials, beverages, cigarettes, chemicals, glass, leather mxi handicrafts goods. ii),na-tion-has-be&n-p1~_j;he_country__ since _theLJ:;haco War, when the Govermnent resorted to large seal.a deficits to finance military operations. Succeeding governments continued this practice while generally adverse trends in the demand for exports permanently contributed to instabilitv and in turn to inflation financing in the public sector. After 1952 the inflation reached runaway proportions. Nationalization ot the mines and the agrarian rei'orm brought about at least a temporary reduction in product!vity. Expenditures :for development purposes were far greater tilan the actual resources available to the Government. -Labor influence in the Government and the desire for a -6 -.. more equitable distribution ot income led to extensive subsidization of certain food and other consumer items and to.successive wage increases. In the eX:i.sting.inflationaiy environment, speculation, a system of' fluctuating exchanges, contraband,·and capital fiights contributed to worsening the situation• Underlying these intemal developments were the unfavorable terms of· trade am the tall in export prices. The world tin market suffered a serious break in 1953, and is still oversupplied. Adherence to the International Tin Agreement and u. s. purchases of tungsten at contract prices based on the 1952 market have provided some me8.8ure of stabilization. Nevertheless extreme inflation and.inadequate export earnings caused Bolivia to use up all her foreign exchange reserves. u. s. aid in 1953 saved many Bolivians from starvation, and since then has been the chief factor in maintaining a highly precarious equilibrium. The hope ~ the GovernmeDt was that increased investment arxl socia1 reorganization would produce short term results and that infl.ation would disappear as production increased. Instead the inflationary process became CUDlUlative, actually hindered production, and ultimately threatened to undermine the eeonoll\Y. To remedy the situation the Government, w.i.th strong popular support, embarked on an economic stabillzation_p~gram in D_e~e..r-1956.~ The stabilization program marks an effort to return to most of the characteristics ot a free econoll\V'• With aid from the u. s. aDi the International Monetary Fund a stabilization fund (initial:cy of $25 million) was created. Decrees provided for the devaluation of the Boliviano and the establishment.of a single exchange rate fluctuating in accordance with market conditions; the adoption of a general policy of free trade; control of bank credit and fiscal measures to balance the budget; the elimination of Government subsidies for essential articles and, except f'or rents, the end of price controls. Wages and salaries were frozen for one year. The stabilization program is run by the National Stabilization Council presided over by the President of the Republic. .An American is its executive director, though a non-voting member. In 19,58 the President's emergency powers were extended for another year. l Despite oppositi.on from segments of the labor movement~ the wage freeze was extended for a year, and a start was made on tile problem. o:r surplus workers in industiy and the mines. The Government has attempted to sti!llulate development and lessen -Bolivia's dependence upon mineral exports through a program of "diversi• [.rication" of the econo~. The aim is to develop industries which would save foreign exchange by using domestic ru materials to produce goods which are -at present imported. In 1955 public investment accomted for 50 percent of gross investment. The chief agents implementing the program have been the previously mentioned petroleum corporation, YPFB, and the Bolivian Development Corporation (Corporacion de Fomento). ·United States aid has been the primary backing for the projects o:r the Development Corporation. -7 II. Labor Force a. Structure The adult labor force of Bolivia was estimated at 1.2 milli~n persona or 34 percent of the population in 1957 by the United Nations. Y This percentage is lower than that shown by the census of 1950, in that the census, unlike the UN estimates, inclmed unpaid fami~ workers aged 10-14. The industrial breakdown, according to the 1950 census is given in the following table. Distribution of the Economically Active Population by Industry and Sex (10 Years am Over) 'l'otal Males FemalesNlllllber Percent .Agriculture, forestry, hunting &fishing • • • 913,959 72.1 533,593 440,366 Mining & petrole\Ull • • • 43,441 3.2 39,309 4,132 Manufacturing • • • • • Construction • • • • • • 109,591 8.1 25,749 1.9 64,6o9 25,146 Wi,982 603 Commerce, banking & insurance • • ••• • • 57,ll2 4.2 32,789 24,323 Transportation & communication • • • • • • Government & public 1.621,279 20,496 783 services • • • • • • • Personal services • • • 40,916 3.0 69,614 5.2 30,599 17,524 10,317 52,090 Other, not elsewhere classified • • • • • • 9,121 0.7 6,823 2,298 Tar.AL • • • • • • • • •-123502782 100.0-7701888 5792894 ( Source: Censo Demo~afico 1950, Direccion General de Estadistica y censos, taaz, 1955. y Economic Developments o£ Bolivia, Economic Commission tor Latin America, Li Paz, 1957, P• I2. -8 -· Unpaid fami:cy-workers constituted over .50 percent of the agricultural labor force. Agricultural. proprietors were estimated at 7.5,000 in 1950, but since the agrarian reform their number has increased• .Indians .worldng on collective lands were numbered at about 140,000. Agricultural. wage earners '·numbered about 2301000 when the censl.is w~ taken. but this number since ·the ~orm· ~as 'prbbab:cy-decreased.-· · Manufacturing absorbed the largest part of the non-agricUJ.tural labor force though only 7 percent of the total labor force. Registered indust:ey (firms registered with industrial associ.ations) employed about one-!ifth of; the total·population employed in manUfacturing · activities, smaller unregistered industries 40 percent, and the remainder in handicrafts. In 19.50 the average employment in Bolivian factories was about 10 workers. · ' ' -. :· ....· Approximately 43,000 workers were employed in the all important ~sector of which 4,000 were ~omen•.. The actual numb~r employed at present is estimated at 6o,ooo. One third of. the miners are season.al laborers, who return to their farms lihen farming activities are most intense. By status 13 percent of the labor force was self-employed, 11 percent salaried anployees, 3.5 percent re~eive some form o:t wages, and 41 percent was .unpaid f~labor. Since the agrarian reform· of l.953 the relative percentage of proprietors aDd wage workers has changed. ilien workers do not constitute a problem as foreign workers account for far lees than 1 percent of the labor force. Employment of aliens is restricted by legislation providing that_§S percent of employees in _ individual firms be Bolivian and thatJ!? percent of total salary p~ments be paid to Bolivian nationals. Exceptions are made for employerswith less than five employees. b. Unemployment Underemployment or activity of a submarginal productive nature, permeates the ecorumv. Moreover, since 19.54 the Govemment by law has prevented all firms from discharging any employee except for cause am has required aJ.l vacancies created by death, discharge, or :resignation to be filled. As a result of this decree and because or lack of expansion of productive facilities it is estimated that there are at present from S,ooo to 101 000 workers in the mines and approximately 10,000 in factory employment who, it is widely recognized, add nothing to production am "JDB3" be considered as surplus. The Government has long realized the economlc problems posed by these workers but has not acted to permit their discharge because of the oppoeition of labor unions which fear widespread unemployment, and because of the inability to shift them to more productive enterprises or to P81' une~loyment subsidies. -9 . From Januar.y through March 1958 as a stabilization device, a special decree permitted the "volmitary retirement" of an undetermined number of workers from private businesses. Inducements to retire were lump sum payments of three months' salary and one month's salar,y for each year worked. Firms covered by the decree were not obliged to replace workers. In the. public sector each Government enterprise was to make its awn arrangements for voluntary retirements during the SSlll:t period. A program of new public works was projected to absorb the excess workers. The decree was recognized as only a small step toward solution of the problem, and resulted in only an infinitesimal. reduction in the number of surplus workers • . ~?Ce Productivity: .The relative efficiency of Bolivian workers has been the subject of great debate. The great majority are igiterate am. have little or no techni~al sldlls, -~:tµle the·facilities for serious vocational and technical 'training are almost wholl,y lacking. At the sazoo time serious deficiencies in diet, housing, lzy'giene, and sanitation reduce the vigor am energy.for work as do such prevalent occupational. diseases as silacosis among the miners. Partly as a result of these conditions drunkenness has been a continual problem in industry, especi~ in the mines, and absenteeism and lack of discipline follow as a natural consequence. Similarly it should be noted that many of the incentives for workers in industrialized countries are not effective for the great number of Bolivian workers. Accustomed to an extreme~ low consumption level they have shown little interest in increasing their earnings by working harder or more regular~. At the same tins ~will devote as little money as they can to bare necessities of life, ani spend the rest on the many fiestas that take place. One subject which has received particular study is the effect of coca chewing on the miners and on the IDiian population who have had a long addiction to it and regard it as a necessity. Opinions vary as to its effects. Presumab~ it helps the Indians to work at the high altitudes while at the same time it is said to deaden their appetites and certainly dull their faculties. d. Labor Mobility A problem of labor immobility is f'ound in the attachment of the Indian population to the Altiplano, where suitable agricultural land is limited, erosion advanced, fertilitq law, and the climate inhospitable, while in other more fertile areas, there are not enough hands for the harvest. The Indian attachment to the Altiplano is partly a defensive reaction against participation in an alien, and previously inhospitable outside world. Part of the problem is a matter of health. Many Indians died in the Chaco War from tropical diseases contracted in the lowlands. The fear persists that they may be unable to adjust to the tropical and -10 and subtropical zones. A rev well planned successful resettlement projects carried out by private enterprise and the Bolivian Development Corporation have demonstrated that such an adjustment can be made. The government, with United States aid, has continued to encourage resettlement, as a means of raising agricultural production and bringing the Indians into market agriculture. The chief project has been the settlement of soldiers and Indian farmers in the Santa Cruz area of Eastern Bolivia. m. Trade Union Movement a. Principal Organizations ~ The Central Obrera Boliviana (COB) is the central labor confederation in Bolivia. It is made up of individual confederations am federations organized on industrial or occupational lines, as well as by geographic areas. ID.dividual unions are thus af'filiated to COB through both their own national federation and through a regional organization. Within OOB, affiliated federations are grouped. into seven central councils (consejos) set up on functional lines. V~noil!!Bgricu1~ t~iJO.J.abQr-f.~ct91___~~.!~g~frlLJS.~~f3d_~r_npl_?Y-ees,_is unionized. The COB also includes agricultural workers and is trying to e:xpand organizational efforts started among them in 19.52. The COB•s cam:pesino (peasant) federations claim to represent the entire agricultural popUlation, but the actual organized strength is unknown. The COB also includes organizations from the nimpoverishedn middle class and the intellectuals. Excluding its agricultural segment the COB has between 200,000 and 2.50,000 members. Labor, through the COB, gained its key position in connection with ita support of the MNR Party. In the election of 1951 general labor -support gave the MNR candidate, Dr. Paz, a plurality in the Presidential election. He was prevented from taking office, however, when a military j\lllta took power. Led by the miners1 who had long been at odds with the Government, a united labor front developed. ~the_reyolution_came_.ilL April 19.52_,~e MNR _came_to_power_with the-help _of_thE! ~~~to:ey :workers_ o~Paz ~.ih..E:L~en__fl"Qm_~~ ne_~}:>y_mining-towna._ These workers were armed and organized into para-military units, and easily overcame the opposition of a dispirited and divided ~· Nine d~ after the revolution the COB was fomed (with government sponsorship) under the leadership of Juan Lechin and the miners union. !.lmost all existing unions soon joined the new organization. The first years of the MNR Government were marked by a great expansion of labor organizations. Under direct Government encouragement and financial aseistance old unions, such as those in the railways and public utilities were reactivated and reconstituted and new unions, such as those among the oil workers, were created. In preparation for the agrarian reform a network of campesino unions were formed under the patronage of the ( Government. P -11 The COB has maintained friendly relations with all international labor organizations regardless of their political orientatioM, but has so far adhered to a neutral. course and refused to affiliate to aey. The main reason for this is the fear that azzy-international affiliation would cause too much internal dissension. Both the COB and its component unions maintain sporadic fratemal relations with other ADErlcan trade union groups1 and the COB has gone on record for the ."unity_of__the---~ ~t~~ti_c~:r;--~JJg_cl_as_s_es~ Recent participation in the activities of the Inter American Confederation of Miners ~presage a cl.oser relationship with the free trade union movement. Leading official.a o! the COB including Lechin have visited the United States, but their contacts with American labor leaders remain slight. b. COB Affiliates The largest and most powerful of trade union federations i.8 the Bolivian Syndical Federation of Mine Workers (FSTMB), having about 6o,OOO members~ The power of the union is enhanced because of its location in ~-k~_indus_try_where-prolonged-work-stoppages_can_shake 'Bolivia's econolJV_._-Moreover, until recently the miners have been closer than 8111' other unions to the MNR and were perhaps the single most important force bringing the MNR to power. Another source of power is _j;heir. own organized _JD;lli~ia-like unit~_Q.f__~~r~__Wb.Tcll-euSt-at . oost of-tlie-mnes:-The mine w-orkers-leader, Juan Lechin;-untli-recently has alwqs played a significant role in the highest councils of the MNR. Since the inception of the MNR.Government.th.e important post of Minister of Mines and Petroleum has generally been held by a mine worker leader. The next largest unions __are_the_!_a_ctory..vorkers__(Confederacion. ~_ner~jadores Fabriles de BQ_JJ.~~)_tdth a strength of about 25,000 and the railroad workers (Confederacion Sindical de Trabajadores Ferroviarios, Transportes .lereos y Ram.as Anexas) with 20,ooo members. Both unions have supplied ministers to the MNR Government. The campesino federations, while theoretically the largest element in the COB, are still an unlm.own factor. In general Bolivian peasants are iess susceptible to effective organization because they are widely scattered, have lower incomee, have virtually no formal education am generally speak only Indian languages. Furthermore the c~sinos have no strong national organization and, having been org~ed u.Mer Government auspices, appear to be liable to Government control. In certain areas the campesino unions also have armed militia organizations. Co Organization of the COB and its Affiliates COB's guiding principles of organization, refiecting its Marxist, heritage, are 'tlemocratic centralism, freedom or discussion, and unity in action." The source or authoriv and policy is the National Worker's Congress, which supposedly meets every two years unless called into special session. In actuality two congresseis have convened since 1952, -12 the firet in 1954 which wrote the rules that now govern the' organization and the second in 1957. Bepresentation at the Congress is male up or delegates from affiliated federations, and from each· regional union; the members or COB•s National Executive Conunit.tee; and, since 1957, the labor members of Parliament. J.n organization chart of the COB is presented on the following page. The active governing body of the COB is the Hational Executive Conmrl.ttee (CEN). Members of the Committee are no:rmally selected at the Natioruu Congress. ·The· CEN carries out the resolutions of t.he National Congress, administers finances, represents the COB in all public acts, and mediates conflicts between affiliates. The Committee normal:Q' consists of the Executive Secretary am 12 assistant secretaries but because of sore differences within the OOB was enlarged for the time being to include 22 assistant secretaries, one from each of COB 1s major affiliates. The Executive Secretary of the CEN is designated the head of the trade union movement. ·Since the inception of the .COB .Juan Lechin has held this post. The third governing organ provided for in the statutory rules is · the National Assembly, which is made up of the members of the National Executive Committee, Centra1 Council leaders, and the labor ininisters in the Government. The assembly theoretically takes the place or the National Congress between its sessions and watches over the implementation of policy. The National Assembly is scheduled to meet at least once a month. The organization or affiliates !'or the most part resembles the organization of OOB, although each affiliate .functions free]3 and determines its own rule. Generally all union federations have their own national. congresses, national executive committees, and regionalbodies. The funds for COB are obtained from affiliates by quota and from private and governmental donations. Lack of funds has been a perennia1 problem for the affiliates, especially the smaller unions. Most union leaders hold outside jobs. Dues are of necessity small am collection is haphazard. Employers mq deduct union dues from wages provided an arrangement is made with the union, but such deductions are not required. In practice only a minority of the unions have made such arrangements. IL some cases a small tax of one or two percent has been imposed by the Government on certain activities to provide funds for specific projectssuch as the construction of union socia1 centers. d. Policies and Programs Present ds;r unionism has been conditioned by its historic development. Prior to 1935 trade union organization was intermittent am partial. Extreme employer opposition, primarily in the mines aIX1 employer dondnance of 'the Government made organization diffi~t. LIBRARY UNIVERSITY OF TEXAS AUSTIN, TEXAS -13 ' l'ABLI nz ~D ORIOIZATIOI OP THI COB latiomal Coagr••• ot Worker• ot Bolivia (4~2) . -~ -I --------. Dational Executive co..ittee (C!I) (13) Executive l~cretar~ and 22 other lecretariea ---~~~~ -T---------------·-. IAtiomal A••e•~l7 (CEJf, Labor Mlaiatriea and Central Council Leaders) Central Cowacil ot Worker• ot Extractive Industries SJ11d1cal Pederatloa of IU•era (67) 8JDd1cal Pederat1on ot 011 Vork~r• (12) 8J11dical PederatioD ot lubber and Poreat Workers (7) CeDtral Collllcil ot Induatrial Workers Confederation ot Pactor7 Workers (}5) 81Jldical Conf~d~ration ot C~n•truct1on Workers (2~) SJD41cal Contederatio• ot 1loar Mill Vorkera (8) Contaderat1on ot Printers (7) Central Council ot Vol"kera in '1'J"anaportat1on and Col!!llun1cat1on SJn~ical Contideration of Railroad, Air Transport lllld Related Worker• (31) Rational Cont~deration ot Telecoa:aun1cat1ona Vor.arera (17) 3JJJ«1cal Contedernt1oD ot C~autfoura \6) Central Covnc11 ot PeasUJts -Representativoa 1'roa Peasant Un1ona (57) C~ntral Co\Dlc11 ot Salaried Wo~kera SJndical Cont'ederat1on ot 'feaChera (16) 8JDd1cal Confederation ot Bank Emplo7eea ~ Vorkera (4) Confedertition ot Private ~•plo7eea (12) Cont~deration or ?ublie E•plo7ees (7) S111a1eal ~ederation ot Sanitation Workara (3) SJJ>dical !'ederation ot :rood Worker• (3) 7ede~ation of Workers ot Social Secur1t7 (5) 811>dical Confederation ot Jfulual Worker• in Education (3) Pederat1011 o: Ml:D1c1pe.l Worker• (5) Central Council ot Popul~r Organization• ~,.nd!cai Con?ederaticn ot Cratt Worker• (7) P•darat!on ot Tenant• (J) Ped«~at1o~ ot Vendors (2} CQntral Council ot Iatell~ctWJ.lB Uaiv~ra!t~ Conte~eratio~ (5f ConfGderation ot Studonta (6) ••deration ot Art ~or~ers (3) Revolutionar~ Youth ot the CO~ (3) UOIOJA:. COJOII'l'TEU (17) La Paz Oruro Cochabaaba Santa Cruz Potosi Sucre Tar1Ja Triaidad Cob1Ja 1t1beralta Vall•ll"ande Topiza 1'1ncha Yacuiba U;JUJJ1 Ca•iri Villa JlfolltH Labor a1n1stera (4) Parl1a11entarz repreaer.tativea (50) Xotaz Figures in p~renthea1• refer to delegates at 1957 lational Congress ot Workers. Sources: Pro~4JIS8. Ideoloeico z Estatutoa de La Central Obrera Boliviana, La Paz, 195~ Central O rera !011vana, Gu1a Sind1cai, Li Paz, 195~. Por~ign Serv1cs Despatches, 1957 -1958. -14 Of necessity the labor movement was forced to polltical action for survival. Only under the protection and encouragement of a succession of milita.ry reformist Governments, and part.iculsrly of the first MNRba. sed regime in the forties, did a strong labor movement develop. Internally, the labor movement has been subject to fragmentation aDi factionalism. With a largely illiterate group of workers the leadership in the union movement was taken by persons with superior education and often with pronounced political ambitions. Intellectuals became involved in the movement early and subjected it to various ideologies ranging from anarchism to Stalinism. Unions often immersed themselves in ideological positions and programs w!lich had little relevance "'9.. economic conditions and some unions were created to be used as a leverage for ":POlitic"Sl.-figures or parties. ls a result of all these factors lesser attention has been paid to improving the economic position of workers and building their industrial power through strong organization, discipline and rank and file support. Under the MNR Government,, labor, through the COB, has grown in power and influence and in turn bas been the major source of support for the Government. It participated in drawing up the basic measures for nationalization of the mines, the agrarian reform, universal suffrage, am the participation of labor in the management of certain state enterprises. During the years 1952-1956 labor infiuence in the Gover~nt was instrumental in securing numerous wage increases and social security benefits. Labor has also ~re_p_t.ly-shared-.pol:JJ,~~~-_p91fe~--'!:i~_'llgh an informal anangement which hs.S been termed "co-government". Under this device up to five cabinet ministers are appointed from labor's ranks from a list of candidates approved by the COB. Labor is al.so amply represented in the National Executive Committee of the MNR. In 1956 in the first congressional electiorus held under the MNR Government, the major!ty of MNR candidates were labor representatives. Until recently labor representatives in Congress combined with peasant representatives to form a distinctive working arrangement known as the worker-peasant bloc (bloque obrero-campesino), which .t'unctioned under the leadership of Juan Lechin. In 1956 Lechin was elected President of the Senate, the upper house,, for the 1956-1957 session. Though acting in alliance with the MNR party, the COB does not consider itself an appendage of the Government, but rather an "original" and "creative" force, uniting workers, peasants, and the "impoverished" mi.ddle class and working with the political authority of the State to achieve the purposes of the "Bolivian Revolution"• These purposes are seen as nthe liquidation of feudalism and the industrial development of the country with the desire to achieve national emancipation from all foreign contro1.n For its immediate goals the COB has urged a further nationalization of industry, more labor ministers in the Government, and the extension of worker's participation in management, to private industr.Y• -15 The COB has always been tolerant of differing ideologies within the organization. As may be seen i'rom the above the official philosophy has been a heavy blend of Marxism and nationeli.sm. In spite of its Mar.xist orientation, it has scorned any commitment to Conmnmism. Labor leaders have praised American economic aid programs and have urged the encouragement of private forei·gn capital to assist in achieving a diversified econmey-. Direct Communist influence in the COB is limited. As on the national political level the Communists are split between the Trotskyites (Partido Obrero Revolucionario -Revolutionary ~orkers Party--POR) and the orthodox Moscow followers (Partido Communista 4e Bolivia -Communist Party of Bolivia--PCB), and have been mutually antagonistic. During the formative years of the COB, leadership of the organization al.most went to the Communists and their supporters by default. Comnnmist criticism of the MNR final.J.y led the Govermnent and its labor supporters to a determined effort to oust the Communists from'leading positions in the CQB. MNR adherents asswned complete control of the COB in 1954 at the first Workers Congress, reorganized the COB, and have since.maintained their dominance. At present few, if any, known Communists occupy positions of high importance in the COB bureaucracy. Communist influence in certain mining centers is strong and in sone affiliates such as the Bakers and Millers ~nion, Communists maintain leadership. Since 1957 strains have appeared within the COB and in the alliancej between the COB and the MNR Govermoents. The influence of the COB has .I ~~e_d_._-~The conflicts inherent in the uaual. diversTtYo!--ideoiogies have been increased by tendencies for union leaders to lose contact with the rank and file and to US"e union strength as a means for advancing their own political ambitions. In practice this has ~ant one segment or the union movement siding with the Government, both for substantive and political reasons, while the other is in opposition to Government policies. The main issue currently at steke is the goveniitent 's economic stabilization program in general and the wage f'reeze in particular. Though the stabilization program or 1957 was greeted with moderate enthusiasm by labor leaders, many of than, including Lecll.in, came to believe that labor was bearing_too. ma.ey. of the sacrificef5 demanded by ~t~iiizat:ion. Moreover;--the stabillzatioi1 program put the -COB-le8aers in a difficult position, because they had fev tangible gains to offer the rank and file. As a consequence the COB made a strong attack on the stabilization plan in early 1957 by embarking on a wave of strikes, which were cut short only after a hunger strike by President Siles• .lt the Worker's Congress in June 1957 the COB threatened the Government with a general. strike if wage adjustments were not f'ortbcoming. President Siles, then made a personal appeal to the people in behalf' of the stabilization program, which won the support of :many COB affiliates and apparently of a great number of workers. As a consequence the general strike was not called. -16 At the Workers Congress of 1957 the differences in the COB came out into the open. The main leadership, led by Lechin, was antagonistic to Government policy.. The opposition, led by Juan Sanjines of the railroad workers (ferroviarios), supporled the Government and attacked the COB leadership on the gro\lllds that it had no real roots in the trade union movement. ·The opposition group also attacked the pervading political role of the COB aIXi urged a shift to a more tradi.i1..!>_~!-l.-tl'a4.e___,uni_o~~orientation-.~ It soon refused to recognize the Executive Conni ttee ,-selected at the Workers Congress and farced the resignatio~ of the Executive Committee in August 1957, and not until January 1958 was a new and enlarged Executive Cormnittee selected. While the COB has nominally held together the split has deepened and there is little working unity. Labor unity in the Congress fell avey as the worker peasant bloc similarly disintegrated in disagreement over the stabiliza tion program. e. Legal Basis of Unionism The laws governing trade union associations are embodied in the General Labor Code and many separate items of legislation some of which are contradictory. ~s in other aspects of labor legislation wide descrepancies exist between law and practice. Both the Bolivian Constitution and the Labor Code guarantee freedom of organization and i mmnni ty of trade union activity, aDi outlaws "direct or indirect obstruction of 'W'rl.on activities" by employers. Unions are directed to protect the economic and social interests of their melli>ers, but forbidden political action. Nevertheless the Government has wavered in applying sanctions and since 1952 has directly fostered union political activity. All types or trade· union associations are permitted. Only one legal distinction exists between craft am industrial unions: craft unions must have 20 or more employees while industrial unions are required to have a membership or 50 percent or the employees of an undertaking. These requirements do not appear to be followed. No distinction is made as to the representative nature of unions. Agricultural unions are not covered by the provisions of the Labor Code but are recognized by th~Agrari~~!'~-~-~~_or 19.53 lihicl:i_ gives them a direct part in carrying out the provisions or"tn'Ef1and reform. Although the Labor Code prohibits the organization of public employees, unions have been formed among them without Government interference since 1952. Before unions can function lawfully, they must obtain corporate recogni'tion. To secure recognition a union must submit an application to the Ministry of Labor, accompanied by certified documents detailing its organization, rules, leaders, and membership. Once corporate status has been secured, the trade union must register with the Inspectorate-General of Labor. A 1948 decree, requiring that all unions have their statutes approved by the Ministry of Labor, has only been desultoril.3" enforced. -17 As to'the executive organs of unions, Bolivian law requires that each union be managed by a responsible committee, all of whose members must be Bolivian by birth. Labor Inspectors are supposed to attend the meetings or the Committee aJXi supervise its activities, but such controls are rarely exerted at present. Legislation of 1951 forbids union leaders to be members of' Congress or to hold cabinet posts, but since 1952 there always have been ministers from labor ranks in the cabinet alXl since 1956 labor representatives in Congress. Unions are required to submit annually a detailed account of' income and expenditures to the Inspectorate of Labor. The Government ~order the dissolution of any trade union association for two reasons: (1) violation of the proVisions of' the Labor Code or of the rules of the organization; (2) union inactivity for over a year. No action under these provisions has taken place since 1952. IV. Industrial Relations a. Collective Bargaining Collective agreements are recognized in the Constitution. Employers are required to enter into collective agreements at the request of workers who are unionized. Agreements may be negotiated either with individual employers or employer organizations and must be filed with the Ministry of Labor. Every agreement must contain provisions pertaining to its extent and duration. 0111¥ trade unions whose status is recognized by the Government mq legally sign collective agreements. In case of infringement of the agreement the obligations of the responsible party are guaranteed by its assets. Collective bargaining has become a somewhat noticeable feature in Bolivian industrial lif'e on:cy-within the last ten years. Because of their influence in the Government, -~=.ru1LI_hemsel.ves,_howev:er,_ha~-shown lit~~~--~~~~-~ the bargaining p~~~,ss. The usual processhBiDeen-for the union to p'?;esent employers with a set of extravagant demands, which are refused. The workers then strike without any continued discussion of their demands and with little use of the extensive procedure for the settlement of collective disputes. The Government is appealed to and the dispute usually settled in labor's favor. Agreements at present are confined mainly to individual undertakings. b. Conciliation and Arbitration Bolivia has elaborate legislation for the settlement of collective disputes, which up to the present time, however, has had limited use. Both conciliation and arbitration are in theory mandatoxy before a strike nuzy-take place. It a dispute occurs, the trade union is required to submit a statement of its complaints to the Labor Inspector, accompanied by proof that a majoriti}r of workers, in assembly of at least three-fourths -18 ot the membership of the organization, approved the demands. The Inspector then requires the conflicting parties to appoint two representatives eacr.. to constitute a Conciliation Board. The deliberations of the Board are presided over by the Inspector, who is forbidden 'b:> express an opinion or vote on the substance of the case. The Conciliation Board may not adjourn until the dispute is settled or it is decided that agreement cannot be reached. Should the dispute continue, it must be referred to an Arbitration Board. This Board is fonned of one member selected from each side or the issue but not from the i.nmediate parties, and is presided over by a higher labor authority, or if one is unavailable an influential political figure in the locality. The tribunal must dictate a decision w1thin fifteen d~s. Adecision must be supported by an absolute majority of its members (two). The award of the Arbitration Tribunal is binding only it the parties agree to it, if the dispute affects essential public services, or if the Government so decrees. As long as any arbitration agreement remains in force, no collective action ~be taken on any questions forming the subject of the award. In practice, action by a Conciliation Board or Arbitration Tribunal is infrequent in comparison with the large number of strike t.hruats and active strikes. Because of Bolivia's economic situation the Government has assiduously attempted to avoid strikes from occurring, especially in the mines. The usua1 practice is to issue an executive decree settling the questions in dispute. Where arbitration does occur, the public member, a representative from the Ministry of Labor, usually votes with labor. The Government then makes the decision obligatory. In the private mining industey the procedures of conciliation and arbitration have been usually followed. In the nationalized mines the use of these procedures has generally been avoided. Labor's position has been·strongl.y institutionalized with representation in the Bolivian Mining Corporation (COMIBOL) a.Id with the Minister of Mines am PetroleU111, who is in ultimate charge of the mines, being drawn from labor's ranks. Because of the necessity for continual. production, the Govemmnt has tried to secure rapid settlement of disputes by direct negotiation between t.he mana·gement of COMIBOL and the disaf'fected union. In case of disagreement the usual practice has been.for the particular mine union to send a delegation to La Paz to enlist the aid of the FSTMB ·in presenting its case to the Mining Corporation. In some cases a delegation of the corporation directors has travelled to the disaffected mining center to try to placate the miners. on the spot. Recent tendencies have been to recognize the necessity for greater production and lower labor costs at the expense or increased welfare measures. c. Strikes and Lockouts The Constitution recognizes the right of workers to strike as "a def'.ensive measure,n and the Labor Code Specifies nstrike" to mean exclusively the peaceful suspension of work. General strikes and -19 sympathetic strikes are prohibited as are stoppages of work in public service. In priilciple tor a strike (or lockout) to be lawful a conciliation or arbitration board must have decided that it is impossible to reach a solution. Furthermore the strike action must be approved by three-fourths of the total number of active employees in the work site. Both parties must give five days not?-.ce of an intended stoppage. Illegal strikes relieve the Employer or his obligation to pq wages and should such a strike last more than three de.ya, strikers ~be fired, but in practice neither of these provisions 11 followed. In cases of large-acale or general strikes the Government mil¥' declare a state of siege and suspend civil liberties. Part of the pattern of continued strike an:i the use of the general strike stems from labor's ideological heritage of both syMicalist and Marxist ideas of class warfare. E:!fm-under-the--MNR-labor-1)riented-govemment _strikes__have been numerOus.--Many of them stem from the lack of discipline in the labor movemmt and labor's avoidance of conciliation or arbitration machinery. In effect, the fltrikes, though illegal, have been tolerated. Many strikes have been expressions of general dissatisfaction or unrest over the stringent economic situation while some can be ascribed to cQn~ip.uaJ 1 eft-wing_agitatio~. Most strikes have ended up in the Ministry of Labor for settlement, and on occasion even have had to be referred to the President for decision. o ·<"",,., 0 \)4tr~. Under Boliv.ia•s inflationary situation the majority of labor disputes have been related to dE111ands tor wage increases. Since 1956 wages have been :frozenrkeX"~ Workers who work six days a week al.so receive pay for the seventh CJ.--3 ,which is not worked/ ManY firms ··aiso provide production and seniority bonuses. '· -· · , · · (4) Profit sharing .,. Busines:sea.·which show' ~rofits at the end of the year are reqUired to p~ a ~rma (bonus), which is equal to a month's salary for employees am. days' wages for workers•. The prima cannot exceed' 25·p'ercent of _the firm~s ·net profit, and if the 25 percent maximwn is insufficient to cover the total amount of the bonuses, it is prorated among workers. Exceptions to the p~ment of the· prim.a are now .rare. Profit sharing on this flat rate basis has · not ensured cooperation betWeen workers 8lxi management. (5) Non-cash benefits -The~e benefits take the form of medical care under the social security program (see social insurance), recreation benefits, low prices on basic items for 'WOrkers in certain industries, and, ~til 1957, Govenu0ent subsidization.of essential items and price controls. · · In its most prominent form low priced, basic living items have been a feature of the pulperia or company store. Every enterprise employing 25 or mo:re workers is supposed to maintain company stores, but they are primarily found in the mining industry where they have· had a long existence. The pul.peria maintains consumer goods at fixed prices for the workers of the mining company. Workers normal.zy cannot buy on credit. In general, prices at the p~ria are maintained at levels below market prices, and during the ation were often below costs. Mine workers frequently used the pulperia privilege as a further source of income by the resale or the items p.irChased. Under the stabilization program the Government since 1957 has for the most part eliminated the direct am indirect subsidies to essential articles and, except for rents, has ended price controls. c. Levels of Remuneration (1) Cash wages -Wages statistics before 1956 are of little value because of the great inflati\}n. Since stabilization however the cost of living, though still rising, has tended to lev~l off. ' The f'ollowing. table shows the basic monthly wages in 1957 for workers in Bolivia's major industries outside of agriculture. The figures do not take into account various bonuses for production, nor the aguinaldo or prima, which would probably raise average monthly -23 earnings b,y a considerable margin. They also do not distinguish between normal and overtime earnings. Statistics are ticking for agricultural workers. Average basi·c monthly wages for non-agricultural Bolivian workers in 1957 were: lJ/ Nationalized Mines Central Office Employees (empleado) at mine locations Workers .(obrero) at mine locations Private Mines (Employees am Workers) Transport (Employees and Workers) Petroleum (Employees and Workers) Manufacturing (Employees and Workers} Government (Employees and Workers) National Social Security Fund Others Construction (Employees and Workers) Commerce (Employees and Workers) Bolivianos 446,000 413,ooo 302,688 200,000 270,000 265,000 16.3,170 316,270 129,770 131,97.3 166,9.30 (2) • Famil.y allowances -Since 1957 family benefits have been raised twice, the latest in January, 1958, and have amounted to an increase of about 250 percent. The amount of benefits decrease with the higher basic cash wage of the worker. As a whole :family bene!its probably represent about 15 to 20 percent of workers' total cash income. The following table she>Ws the scale o:f family benefits as or Januar.r 1958. Thus a married worker with two children of. schqol age making BS 200,000 in,wages would normally receive 00 41,600 monthly in family allowances. Many firms appear to be delinquent in the peyment of benei'its. :· (.3) : Labor costs -Because of the lack of adequate statistics, it is di:fficult to make any-estimate of labor as a cost of production. In general.the employer's labor bill consists of total wages and 30 percent of total wages for all social security benefits. The 30 percent represents a consolidated p~nt for benefits since 1957. A study of the nationalized mines estimated that total labor costs including housing, recreation, and cheap pulperia benefits represented53 percent of production costs. 2/ l!f Source: Bolivian Ministry of Labor as reported in Foreign Service Despatch 648, Januaxy 14, 1958. 2J Source: Foreign Service Despatch 125, September 22, 19.54. Family Allowances in Bolivia According to Basic Wages in Bolivianos, 1958 Category ot Bene.tit Monthly Wage Level Below 100,000 from 1001 000 to 12.5,000 from 125,001 to 150,00liyian labor legislation refiects more_ ideals of sociaJ._.}ustice .rather~·than ·actua.1--conditions or work in-Bolivia. -It refiects also the predominant influence of too State, as subjects are covered.which in other countries more often are found in collective agreements. The practical application of the laws is limited both by genuine difficulties of employers in meeting legislative standards and by inadequate governmental means of inspection aIXl control. With recent legislation there is often an overlapping of decrees arxl even some degree of contradiction. Bolivia is trying to rectify this latter defect by preparing a new codification of lsbor legislation with the help of experts from the International Labor· office. The following is a brief summary of the pertinent labor legislation and practice that has not been previously dis.cussed. a. Hours of Work -The legal work day in Bolivia is eight hours and the legil work week 48 hours. For women arxl for workers under 18 the legal work w~ek is 40 hours. Night work is limited to seven hours, for which workers receive a 25 to 50 percent premium. Overtime is authorized up to a maximum of two hours per day and must be remunerated at double the nonnal rate. Work peri'ormed on Sund~s and public holidays is also paid at double the normal rates,. b. Emplo~nt of women snd children -Employment of children under 14 except in e case of. apprentices Is prohibited. Women am young persons are barred from participating in dangerous or heavy work though this prohibition does not appear to prevent them from being employed in the mines. Women cannot be employed at night. Women are entitled to a twelve week confinement period, and undertakings which employ more than fifty women must maintain creches. c. Vacations and leave -Workers are entitled to :ru~ paid vacations, whiCh vary l'rom one week to one month according· to length of service with the company. If work is suspended seasonally .for more than fifteen days workers receive no vacation. There are sixteen paid legal holidays; in addition there are various holidays celebrated in each o! Bolivia's nine departments as well as special authorized holid~s celebrated by certain groups of workers. If sick, workers (obreros) with mo.re than one year•s service retain job rights for 30 days and salaried employees (emoleados) for three months. 7/ Decreed by the Executive in 1939 but not ratified legislativelyunti1.:..i942. -26 d. SeveranceJay -The employer must give the worker notice of intent to termrnate s contract~ the prescribed time being in accordance lid.th the worker's length or service. When employment is terminated against his will, a worker is entitled to receive a lump sum p~nt (indemnizacion). The indemnity is equivalent to one month's salary for eacll year of continuous labor with the company. Calculation of the payment is based on the average of the last three monthly ealeries or the last 75 days worked. Workers with eight years or more of service may receive the indemnity even though they retire voluntarily. e. Health and safety -Bolivia has an industrial hygiene and safety act (1951) WhiCh was drafted by an American expert. This act requires employers to maintain adequate sanitary aid safety conditions for the preservation of worker1s health and f'or the avoidance . of accidents and occupational diseases. For dangerous industries prescribed measures of protection are specified. Lack of ftmds am trained personnel in the Government has prevented the systematic compilation of data on the existence of health and safety hazards and hindered the initiation or a program for prevention. The situation in the mines is especially serious. Nine't7-five percent of the nation's bill for work-connected disabilities is paid to miners, while the cost for treatment of accidents and diseases are very high. Most serious is the high rate of silicosis. VIII. Administration of Nationel Labor Policy and Legislation Labor law is administered by the Ministry of Labor and Social Security and enforced by the Ministry and the National Labor Judiciary. The present Ministry or Labor was created in 1926. The Ministry JDa1' intervene in all controversies concerning labor contracts and claims !or wages arising between Employers and employees. There are three :main divisions within the Ministry, a General Labor Inspectorate, a Technical Department, and the Labor Judiciary. The National Social Securicy Fund is also under the jurisdiction of the Ministry. The small corps of inspectors spend most of their ti.me in trying to settle individual or collective disputes between workers alXi employers. The Technical Department includes economic analysts, medical practioners, and statisticians and appears to be responsible for much of the labor inspection that is actually carried out. A s;rstem of labor courts has been in existence since 1940. Jurisdiction of the courts extend to 11try in the first instance all cases of a dispute arising from the application of the laws of labor mid social protection and from the stipulationa of labor contracts; of disputes arising from the laws or agricultural labor and from contracts in this sphere; and • • • accusations of infractions of the social laws.n Labor judges Jl81" enter into the process of arbitration -29 and conciliation as a third party but their pri.mar.y function is the legal interpretations of laws and contracts. Judges are located in the twelve major centers 0£ Bolivia. Appeals from decisions at the Labor Judges ~be taken to the National Labor Court, composed of a president and two members, and located in La Paz. The highest court of appeal, as in all cases, is the Supreme Court of Justice in Sucre. !LS58-3532 -Labor D. C.