Kast’s Labor Reform Mirrors Pinochet’s Labor Plan, Analyst Claims

Original article: “Cambia el método, no el programa”: analista ve en la reforma laboral de Kast la lógica del Plan Laboral de la dictadura

The initiative pushed by José Antonio Kast’s government to revise the calculation unit of the workday is not merely a technical adjustment; it serves as the spearhead of a strategy that analyst Diego Lorca identifies as a replica of Augusto Pinochet’s Labor Plan.

“The method changes, not the program,” declared the director of the International Observatory of the Future of Work (OITRAF) regarding the proposal submitted on July 13, aimed at extending the period for calculating the average of 40 hours from 4 to 16 weeks under the general regime and even to 52 in the tourism sector.

According to the analyst from Latin America and Caribbean News (NODAL), the government’s maneuver to leave the text of Law 21.561— which reduces the workweek from 40 to 45 hours until 2028—untouched, while flexibilizing its calculation, reveals a strategy that distorts the original intent of the measure, subjugating workers’ rest to employer interests, part of the same scheme used during the dictatorship.

Lorca recalled that the Chilean Workers’ Central (CUT) referred to it as “the new Labor Plan,” echoing the one designed by José Piñera in 1979 for Pinochet’s regime, solidified in the Labor Code of 1987, which established an order that subsequent reforms barely adjusted.

In his opinion piece titled: “Kast is pushing in Chile a labor reform comparable to the dictatorship’s Labor Plan”, the Psychology graduate with a Diploma in Political Economy and Geopolitics of the South warned that “whenever a right-wing government takes over in Latin America with an adjustment program, labor regime reform occupies the same spot on the agenda, and the argument repeats without variation, making layoffs cheaper to ‘create jobs.’”

He referred to the case in Argentina, where the Labor Modernization Law “consolidated the same in a single norm, denounced in June by the CGT before the ILO,” while in Chile “the content progresses through sectoral statutes.”

“The method changes, not the program,” emphasized.

Lorca pointed out that the president of the Federation of Mining Workers (Fetramin), Cristián Cuevas, has already labeled this offensive as a “counter-reform to the advancements we’ve achieved in these thirty years of democracy” and that Kast’s administration seeks to sell a “product that would eventually create jobs,” but which, according to data, constitutes a “farce.”

Lack of Union Representation and Extension of the Period for Calculating the Workday

In the document, he criticized the Labor Reactivation Table convened by the government—led by David Bravo and composed almost exclusively of economists and engineers, without union representation or labor law specialists—and claimed that out of its 22 proposals, 9 modify labor regulations and three concentrate the dispute.

Lorca highlighted the proposals that crystallize the neoliberal logic that aligns the current administration with the Chicago Boys, who directed the economic policy of the dictatorship. Two of them are: the extension of the workday calculation cycle, which has already been turned into a bill. The second, according to the analyst, is the replacement of severance pay for years of service in new contracts with a mechanism financed by the worker’s individual savings through the Unemployment Insurance, thus shifting “the cost of layoff to the worker’s savings.”

The third reinstates in Article 161 of the Labor Code the “lack of worker adjustment” as a ground for dismissal, which was in effect between 1990 and 2001.

Lorca’s analysis focused on the paradox of the government’s labor reform proposal in the current economic context of Chile, facing an unemployment rate of 9.4% for the March-May quarter, and a loss of 42,000 formal jobs in the past twelve months, while informal jobs have increased by 112,000 and the median labor income stands at 680,000 Chilean pesos, just above the poverty line for a household of four.

National Mobilization to Halt Chilean Right-Wing Advances

Finally, he warned that the political situation is the main obstacle and noted that while all labor unions have rejected the package of measures, a lack of unity hinders a robust national mobilization.

“Collective bargaining by branch and the demand for union agreements over individual contracts remain the major pending axes,” he recalled, warning that coordination and unifying efforts are lacking “for a mobilization or national strike capable of putting a stop to the advances of the Chilean right against the labor and political rights of the working class.”

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