Labour law violations in Chile

• Author: Ravi KANBUR,Lucas RONCONI,Leigh WEDENOJA
• Date: 01 December 2013
• Published date: 01 December 2013
• DOI: http://doi.org/10.1111/j.1564-913X.2013.00187.x

International Labour Review, Vol. 152 (2013), No. 3–4

Copyright © The authors 2013

Journal compilation © International Labour Organization 2013

Labour law violations in Chile

Ravi KANBUR,* Lucas RONCONI** and Leigh WEDENOJA***

Abstract. This empirical contribution to the quantication of labour law viola-

tion uses micro survey data to examine compliance with workers’ statutory entitle-

ments to a minimum wage, working time limits, a written contract, and pension

coverage over the period 1990–200 9. One-third of workers were denied at least

one of these entitlements, albeit with signicant variations in the incidence of vio-

lations over time, across laws and by worker and rm characteristics. The authors’

econometric analysis shows that compliance rates are lower for female, foreign-

born, indigenous and less educated workers, and in smaller rms and agricultural

regions. Further research, they argue, should focus on enforcement.

R

eform of labour law is central to policy discourse in developing countries,

and in Latin America in particular. Proponents of deregulation argue

that overly stringent legislation feeds informality and serves to hold back ef-

ciency and growth. Opponents of deregulation argue instead that these laws

curtail the power of employers and protect workers.1 However, both propo-

nents and opponents seem to argue equally from an assumption of effective en-

forcement of labour laws. At least, they do not focus on issues of enforcement

or violation of laws. In the extreme case, if the laws are not enforced at all, then

the deregulators have the outcome they want by default and their opposition

to the current laws is somewhat tangential. Even if violation is partial, both

proponents and opponents will have to modify their arguments accordingly.

But how much labour law violation is there? The question is at heart an

empirical one, dependent on context and institutions. A growing body of lit-

erature has attempted to quantify compliance.2 The broad conclusion is that

compliance is far from complete, and the incidence of violations varies across

countries and across regions and sectors within countries.

* Cornell University, Ithaca, NY, email: sk145@cornell.edu. ** Centro de Investigación

y Acción Social (CIAS), Buenos Aires, email: ronconilucas@gmail.com. *** Cornell University,

Ithaca, NY, email: lrw55@cornell.edu.

Responsibility for opinions expressed in signed articles rests solely with their authors, and

publication does not constitute an endorsement by the ILO.

1 See World Bank (2012) for a recent review of the literature.

2

See, for example, Strobl and Walsh (2003), Maloney and Nuñez Mendez (2004), Kristensen

and Cunningham (2006), Andalón and Pagés (2008), Ronconi (2010), and Bhorat, Kanbur and

Mayet (2012a).