Collective Bargaining in Chile

How collective bargaining works in Chile

Collective bargaining in Chile is governed by Book IV of the Código del Trabajo, as reformed by Law 20.940 in 2016. A union or a negotiating group of workers at a company submits a proposed collective contract, the employer must respond, and both sides bargain over pay and conditions for a fixed term, usually between two and three years. The process is supervised by the Dirección del Trabajo, which also offers mediation.

For a foreign group opening or acquiring a Chilean operation, the first bargaining round is often a culture shock. The law gives unions rights to information about the company's financial position, requires both sides to bargain in good faith, and protects workers from retaliation. At the same time, it sets out how strikes work and what the employer can and cannot do while one is underway. Our team advises on the process from the first notice, and works alongside the protections covered on our union leader protection page.

What we handle

The regulated process step by step

In the regulated (reglada) procedure, the union presents its draft contract and the employer replies in writing within a legal period, normally responding clause by clause rather than with a general statement. The parties then negotiate. If they reach agreement, the contract is signed and filed with the Dirección del Trabajo. If they do not, either side can request mediation, and the workers can vote on a strike.

Only the regulated procedure carries the full legal protections around timing, strike rights and employment protection for the workers involved. The parties may also bargain outside that framework, which is more flexible but does not give the same guarantees. Choosing the route is one of the first decisions we help with, because it determines the calendar for everything that follows.

Good faith, strikes and what to avoid

Chilean law lists conduct that counts as unfair practices in bargaining. Examples include refusing to hand over the information the union is entitled to, answering a proposal only in general terms, using replacement workers during a lawful strike, and retaliating against negotiators. Courts have treated incomplete financial information and vague responses as breaches of the duty to bargain in good faith, which can remove procedural protections for the employer. We cover that risk in more detail on our unfair labor practices page.

Sector-wide bargaining has been the subject of legislative proposals, and the rules on benefit extensions to non-members, minimum services and adaptability agreements are also technical. We confirm the current text of the law and relevant Dirección del Trabajo rulings before advising on any bargaining round.