CHAPTER 8 THE LABOR SITUATION

• Jurisdiction: United States

International Minerals Acquisition and Operations
(Oct-Nov 1974)
CHAPTER 8
THE LABOR SITUATION
M. G. Johnson
Bechtel Corporation
San Francisco, California

In evaluating the viability of exploratory or developmental activities in foreign countries, it is not sufficient with respect to the labor situation to confine the inquiry to the availability and capability of the local work force and the prevailing wage rates which must be paid. While these factors are perhaps the most significant with respect to labor, there are a number of other considerations which may have a substantial effect on costs and which, if properly provided for at the outset, may substantially minimize the practical problems of accomplishing the exploratory or developmental goals.

Since this presentation is not limited to any particular geographical or political area, it is not intended to provide definitive answers to the questions which must be asked with respect to the labor situation but rather will outline at least some of the questions which must be asked together with suggestions as to the source of some of the answers. Since legislation, rules and regulations with respect to labor are changing rapidly throughout the world, particularly in those countries which only recently have begun the transition from essentially an agrarian society to at least a semi-industrialized economy, the answers and even the questions themselves will continue to change at an equally rapid rate.

In preparing a presentation such as this, any lawyer will first attempt to assemble the data with which he is working into a logical consistent pattern with the intent of emphasizing the differences between the various laws and practices elsewhere and the logical pattern which is utilized as a base. Inevitably, the first logical and consistent pattern which comes to mind involves the laws and practices of the country with which he is the most familiar. At this point, the whole process breaks down, at least if one's starting point is the United States. To identify and catalog the laws, practices and regulations applicable to the employment of labor by a business enterprise in the United States would require several volumes of editorial comment supported by at least an equal number of volumes setting forth the applicable statutes, regulation and judicial decisions to which reference is necessary to enable a prospective employer to determine the full extent of his obligations and problems. Even

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that effort would necessarily omit the text of the various collective bargaining agreements which might be relevant, not to mention the numerous unrecorded arbitration decisions which interpreted those collective bargaining agreements. The problem is further complicated by the volatility of the law in this area, as evidenced in the United States by the recent federal legislation relative to pension reforms. In short, it would be presumptious and probably impossible for anyone to publish a truly authoritative summary of the labor situation in the United States which would provide for a foreign business organization desiring to operate here all or even most of the information it would need relative to the labor aspects of the business.

The foregoing suggests not that a reasoned discussion of this topic is impossible, but rather that such a discussion should concentrate on the broad aspects of labor laws and practices in a number of countries to illustrate the kinds of problems which may be encountered and to emphasize the need for in-depth review of the entire subject with local governmental agencies and business organizations as well as local counsel before a decision is made to commence operations in a particular country.

Evaluation of the local labor supply requires at the outset a realistic...