August 30, 2016 / 6:20 PM / 3 years ago

Workers at Chile Codelco's Salvador copper mine vote on strike

SANTIAGO (Reuters) - Workers at Chilean state-owned miner Codelco’s smallest copper mine began voting on Tuesday whether to accept a wage offer or go on strike, a potential headache for the company as it finds itself in a delicate financial position.

Union leaders at the Salvador mine in Chile’s arid north say they are opposed to the wage offer and complain that much-needed investments are being crimped because Codelco is legally required to funnel part of its revenues to the armed forces.

“Workers have to ask their conscience and evaluate whether or not they accept this proposal, but in our opinion we view this proposal negatively,” Waldo Ponce, the spokesman for union 2 at Salvador, told Reuters.

The wage proposal includes a $3,730 per worker bonus but offers no wage increase. The results of the vote are expected by Thursday.

Nelson Pizarro, the outspoken chief executive of world no. 1 copper miner Codelco, has said that the company was in an “extremely fragile” position and argued that “there is no money, not one damn peso” to pay for an ambitious multi-billion dollar investment plan.

As Codelco has been forced to slash spending in the wake of a steep fall in the price of copper, a heated debate has stirred to abolish the law inherited from General Augusto Pinochet’s dictatorship that forces Codelco to hand over the equivalent of 10 percent of its sales to finance the military.

“Codelco finds itself in this situation now not because of the workers, or high salaries or bonuses as some say, rather it is due to bad management and the lack of investment due to the Reserved Copper law,” union president Patricio Elgueta told local radio Cooperativa.

Reporting by Fabian Cambero; Writing by Anthony Esposito; Editing by Bernard Orr

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