Chile

 
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Official Name

Republic of Chile

 

Surface 756.50 Km2 
Climate Temperate. Desert in the north and central area, humid and cold in the south. 
Geography

It borders the South Atlantic and South Pacific Oceans. It is located between Argentina and Peru. 
Capital City Santiago
Currency Chilean Peso
Population 15.153.797 
0-14 years old: 28% 
15-64 years old: 65% 
More than 65 years old: 7% 
Demographic Growth 1.17% (2000 approx.) 
Religion

Catholic 89%
Protestant 11%

Percentage of People Instruction  95.2% 
Type of goverment  Republic 
President Ricardo Lagos Escobar (since March 2000) 
Organization

Executive Power:

The President is the Chief of State and Government, elected through popular vote for a period of six years.Ministerial Cabinet appointed by the President.

Legislative Power:

Bicameral National Congress, integrated by a Chamber of Senate with 48 members, 38 being elected through popular vote for a period of 8 years and they are renewed -half of them- each four years (the ex presidents keep the title of life senators). Chamber of Deputies of 120 members elected through popular vote for a period of 4 years. 

Judicial Power:

Supreme Court integrated by 21 judges appointed by the President and ratified by the Senate. 
Administrative division  13 regions 
National Day September 18th, 1810 Independence Day. 
Constitution September 11th, 1980. Modifications: July 30th, 1989 and in 1993 
Political Parties Christian Democratic Party (PDC)
Concertación (CPD)
Independent Democratic Union 
Agriculture Wheat, corn, grapes, grains, potatoes, fruits, meat, fish and wood. 
Industries Cooper, minerals, food, sea products, iron, steel, wood and wooden products, transportation equipment. 
Telephone Lines 2.603 millions (1998) 
Celular Telephone Lines 197,300 (1995) 
TV Stations  63 
Internet Access Services  26 (1999)
Railways 6.782 km 
Roads 79.800 km 
Ports Antofagasta, Arica, Chanaral, Coquimbo, Iquique, Puerto Montt, Punta Arenas, San Antonio, San Vicente, Talcahuano. 
Main Airports  Arturo Merino Benítez International Airport (Santiago) 

 
Menú
• Laws that govern the labor market • Minimum Monthly
• Taxes • Cost of the basic monthly basket
• Work Days and Holidays • Sectors with the larger demand for Workers / Industry
• Social Security and Vacations • Habits and Customs
• Active labor force • Some Macro Economic Indicators
• Unemployment   
 
Laws that govern the labor market Labor laws are not compiled in a specific Labor Law, nor are they part of the Constitution; nonetheless, the rights and responsibilities of the people are stated in it. There is a Law of Labor Contract, which is the principal law, as well as other laws regulating different aspects. Generally speaking, they establish a trial period of three months that may be extended to six months via an agreement, and to 12 months in the PyMES (Small and Middle -sized Companies).

The employer's contributions to social security in the companies that keep workers in the pay roll for a period longer than the trial period established are reduced to a third. The companies that have men workers over 45 years, or women who are heads of households, are subsidized. Contracts may be signed between the parts and the ones signed by the company prevail over the ones signed in a larger context (region or activity).

 

 Taxes

The employers are under the obligation to make deductions for social security (sanitary attention) as well as to make contributions (pension funds) to the employees signed for an indefinite or effective period of time. The deductions for social security ascend to 3% of the salary and the contributions for pension funds to 11%. Deductions are not made to the employees during the trial period. There is no legal difference between local and foreign workers.

Furthermore, the employers must deposit their contributions which include life insurance, unemployment insurance and ART (Work Risks Insurance). There may be other deductions and deposits that will be determined by specific agreements. Regarding income tax, there are no differences between local and foreign workers. Deductions are made to workers who earn approximately 1,500 pesos monthly (the equivalent of US$1,500). Deductions are made on a scale from 9 to 35 %, in relation to the net income of the person contributing.

Income Tax (starting from $1,500 monthly, over net income): From a minimum of 9% to a maximum of 35%

Social Security: 3%

Pensions Fund: 11%

 
Work Days and Holidays The law establishes a workday of a minimum of 8 hours and it should not exceed 48 hours per week. For unsanitary or night work, the workday is 6 hours long (this does not affect the minimum salary). If the worker exceeds the stipulated working hours," overtime " must be paid for double the normal amount. If the worker works on a Sunday, a national or local holiday established by law, there is double pay for the workday.

The time schedule for entering and leaving depends mainly on the specific agreements that each sector or company signs. Furthermore, these time schedules are determined by local habits (in the provinces the workday is divided into morning and afternoon; in the capital it's continuous) as well as by the climate in the different regions, which varies greatly. Generally speaking, one may refer to the following schedules:
Average Schedule - Public Sector Continuous: from 7:30 a.m. to 1p.m.A double shift: from 9 a.m. to 1p.m. and from 4:30 p.m. to 8 p.m.
Average Schedule- Private Sector  From 9 a.m. to 5 p.m. (continuous)Double shift: it varies
Legal Holidays (pay is obligatory)

There are 11 national holidays:
· January 1st (New Year)
· April (Good Friday)
· May 1st and 25 (Labor Day and anniversary of the first patriotic government)
· June 20 (Flag Day)
· July 9 (Independence Day)
· August 17 (death of General San Martín) · October 12 (Discovery of America)
· December 8th and 25th (Immaculate Conception and Christmas)

The holidays of each province are added to these.

 
Social Security and Vacations

Social Security and Vacations

Social Security: there are two modes

Unjustified dismissal (when the employer decides to lay off the worker)

  Indemnity: it is calculated on the basis of a twelfth of the highest salary during the last year, or a fraction higher than ten days. This amount is multiplied by the number of months worked.

Notice: the employer notifies the employee one month before his dismissal (in such a case, he must allow the worker two hours daily in which to search for another job); otherwise, he must pay a month´s salary.

Vacations: are calculated on the basis of the days that correspond to the worker, in proportion to the work. Only the vacations of the two previous years are included; other vacations that the employee had not taken expire:

Justified Dismissal (when the employee fails to comply with regulations) 

The salary is paid up to the day of the dismissal, and the vacations are paid according to the system abovementioned.


Vacations and Christmas bonus: 

Vacations are taken yearly, are paid and correspond to 14 continuous days for workers with less than 5 years in the company, 21 continuous days for workers with 5 to 10 years, and 35 continuous days for workers with more than 20 years. These may not be compensated with money.

Christmas bonus: The highest salary of the year is divided in two quotas, one in July and one in December; this is not taken into account when calculating indemnities.

 
Active labor force/
Total Population

 

 

Total Population 36,000,000
Economically Active Population 15,264,000
Employed Population 5,479,776

 
Unemployment 
Unemployed

 2,350,656
Unemployment Rate 

15,4%

The demanding underemployed (workers who work less than 35 hours a week, are willing to work more and are looking for other occupations) is 9.5% and the non-demanding underemployment (are not looking for another occupation) is 5%.

 

 
Minimum Monthly Salary (August 2000)

Minimum salary, vital and changeable, established by law. Free of deductions and family benefits. Non-impoundable, unless as food benefit for children. $250

 
Cost of the basic monthly basket Typical family (father, mother, and two children). Includes cost of recreation, education and health. Without including these costs, it is considered that a family, which earns under $550, is part of the poor sector. $1,100 monthly

 
Sectors with the larger demand for Workers / Industry Argentina is very rich in natural resources; it has a high percentage of literacy, an agricultural sector oriented towards exports and a diversified industrial basis.

Its main industries are in the areas of food processing, automobiles, textiles, chemical and petrochemicals, metallurgy, iron and printing.
The sectors with the highest demand for workers are: agriculture, services (such as wholesale and retail commerce, financial and banking activity, telephone communications, mail service and education).

 
Habits and Customs

Argentina has a predominantly urban population and one of the lowest rates of demographic growth in the region, as well as a relatively high standard of living. At least half of the population is considered middle class, and Buenos Aires, its capital, a metropolis of around 12 million people, is the center of the nation's life.

The habits and customs regarding employment vary enormously in relation to the type of work, the employer and the region. In recent times there have been more and more jobs, without a specific time schedule and with a free day per week, especially in the private sector.
The influence of North American culture has increased in recent years and generally the different cultures and foreign trends are welcomed. This has coincided with the recent arrival in past years of a new wave of immigrants; in this case, the majority comes from neighboring, Latin American countries.

 
Some Macro Economic Indicators
Gross Domestic Product 
(Nominal, in millions of pesos) (1999) 

285,932 millions

Annual Growth Rate 

3%

 
Annual Inflation Rate· 
From January to July 2000

-0,1%
0,4%
Exchange Rate in relation to the dollar. (A convertibility Law maintains this rate stable) Selling US$ 1=1$
Buying US$ 1= 0,99$

 

Natacha Schvarts (conteni2digitales.com)
Sources: INDEC National Institute of Statistics and Census, Alejandra Bazán, attorney specialized in Law and Labor Laws in Argentina.