Regional Rigidity in Latin America - Ius Laboris

Source: Latin Lawyer
Country: United Kingdom
Author: Marieke Breijer
Date: January 2012
Page: Web
unheard of in other jurisdictions. “It massively increases the cost of the total operation, and one
case alone could ruin a small corporation,” de la Vega says.
Second to dismissal are cases related to overtime, while the breach of fundamental rights such
as health and non-discrimination are also on the rise across the region. “Employees can give
notice to a company to have rights respected, and if the situation doesn’t change, they can get
money from the employer through the courts,” says BDS Asesores’ Durante of the situation in
Central America. In Colombia, Brigard & Urrutia partner Alvaro Cala is interested to see how an
anti-harassment and anti-discrimination law passed some six years ago will bring about further
changes in the litigation landscape, as it has led to a mix of the criminal and labour practices.
The Central American countries and Brazil are examples of where taking court action is easier
for the employee, as it is free for a plaintiff to bring a case to the courts. “It is quite easy for
employees to bring cases where they feel they’ve been wronged,” says Veirano’s Migliora of the
situation in Brazil, adding that employees are at a relatively advantageous position cost-wise
because their lawyers tend to operate on the basis of a success fee. “For the prospective
plaintiff it is basically a lottery where there is nothing to lose, as such the country knows a high
number of individual actions,” he says.
In most cases, the associated risk of going to the courts is a lot higher for the employer. “You
have to pay the lawyers, experts, involve managers in hearings, all of which cost you time and
money, which isn’t good for the balance sheets,” says Marval’s Stile of the situation in
Argentina.
In Peru, dismissed individuals can even use the court system to be reinstated as an employee
by means of constitutional action. Employees can only be let go if they are found to be at fault,
which is why employers prefer to hire people on a temporary basis. However, if this is done
through the incorrect form of contract, the court will rule it is in fact an indeterminate labour
agreement and the employee will be allowed to go back to work. The difficulty relating to
termination of employment is “a hot topic in Peru,” says Olaechea’s Valdez, and most of the
time, the companies prefer to settle for a higher payout with the employee than continue the
court procedures.
All activity suspended
Last November, workers at Campo Rubiales succeeded in suspending operations at what is the
country’s largest oil field through strike action. Demanding better labour relations and job
security, workers complained of being hired on temporary contracts through intermediaries, and
being denied the social benefits associated with full-time employment.
In the same month, Petrobras workers were close to a walkout over demands for better wages
and benefits from the state-owned heavyweight. Contemplating the potentially massive cost of
an all-out strike, the company did not waste any time and started negotiating with the Brazilian
Oil Workers Federation (FUP), an umbrella organisation that represents some 60,000 of
Petrobras’s 75,000 employees, and managed to avert crisis by reaching an agreement that
satisfied the union leaders.
Only a day before Petrobras employees called off their strike, activity at Brazil’s Santos port was
stopped in a 24-hour surprise action. Barring ships from entering or leaving the port, the walkout
was meant to warn port authorities of the possible consequences to the country’s export