The Congress Resolution, which authorizes risk exploration agreements, provides for maximum use of local manpower and services including technical, engineering and consulting services. It also stipulates that local personnel must be trained in the required specialties and that there must be an effective transfer of foreign technology.

The next section outlines the principal legislation in the labor area.

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3.2.l Constitutional Provisions

The Constitution also confers special protection on women and under-age workers.

Finally, the Constitution provides for a social security system to protect all workers against misfortune and risks arising from their work, which has been developed by a special law.

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3.2.2 Organic Labor Law

According to Article 27 of the Law, at least 90% of workers must be Venezuelan in firms that have 10 or more workers.

However, Article 28 allows the Ministry of Labor to authorize temporary exceptions for activities that require special technical knowledge, and for which no Venezuelan personnel are available. Such exceptions are conditional on the training of Venezuelan personnel by the employer.

The most important labor benefits contained in the Labor Law are:

• Severance Pay (prestaciones sociales): when the employment relationship terminates for any reason after three months' service, the employer must pay the worker compensation equivalent to 10 days' wages, if the length of service does not exceed six (6) months, and one (1) month's wages for every year of service over six (6) months. This compensation is a vested right.

• Profit Sharing: this benefit consists of a share in the net profits of the company, defined by law as the sum of the net taxable and exempt income as defined in the Income Tax Law, payable at the end of every year. At least 15% of company earnings have to be distributed to the work force. Between 15 days' and four months' wages must be paid.

• Termination of the Employment Relationship: Article 99 of the Law stipulates specific causes for termination which are defined as justified or unjustified. Termination is justified when the worker incurs in the situations specified in Article 102, related to non-performance by the worker. The cause is unjustified when the dismissal is made for other reasons.

  Calculation of severance pay depends on the cause of dismissal: for unjustified dismissal, all benefits are paid double; if dismissal is justified, single benefits are paid.

  The system of severance pay, along with other labor benefits including the dismissal procedure and the social security system, are presently undergoing reform, following the agreement reached by the Government, employers and unions.

• Job Stability: This right is guaranteed by the Constitution and confirmed by the Nationalization Law and the Labor Law, which establishes job stability as a right for non-managerial workers with over three (3) months' service, including workers hired for a fixed period. These works cannot be dismissed without due cause.

  In all cases of dismissal, according to Article 116 of the Organic Labor Law, the employer must notify the Job Security Tribunal within five business days, the worker may appeal to the Tribunal during the same period. If the tribunal finds the dismissal to be unjustified, it orders reinstatement of the worker and payment of lost wages. If the employer does not appear, the dismissal is deemed to be unjustified.

• Collective Bargaining: Both the Constitution and the Labor Law confirm the right of workers and employers to negotiate collective agreements that define the rules for industrial relations, including the peaceful settlement of disputes.

  The collective labor regime in Venezuela assumes the existence of unions and professional associations, governed by their own statutes and by the general provisions of the law. The goal of these organizations is to protect the interests of organized labor and promote improvements in the social, economic and moral conditions of the workers. Union officials enjoy special privileges (fuero sindical) and cannot be dismissed or demoted without just cause.

  Collective bargaining agreements are made between one or more unions, with one or more employers. They establish the conditions for labor relations and the rights and obligations of the two sides. The conditions apply equally to workers who are not union members, and to new workers. New agreements may only weaken the provisions of previous collective agreements if economic circumstances are jeopardizing the company's activity, in which case such changes must be authorized by the Labor Inspector.

  Workers in the oil sector have agreed on a uniform collective agreement with the various employer groups in the sector. Case law has not established a precise ruling on the applicability of the oil-industry collective agreements to the private companies that are beginning to enter the oil sector.

3.2.3 Organic Law of Prevention, Conditions and Environment in the Workplace

The Law provides for the creation of a health and safety committee in all companies and industries, formed by experts in industrial safety and representatives of workers and employers. The committee is responsible for inspecting the environmental conditions of the workplace and for making recommendations on the prevention of industrial accidents and diseases.

Employers may in no case expose their workers to the physical agents, psycho-social risks, chemical or biological products or other agents that could cause problems to the worker without prior warning in writing by any appropriate means on the nature of the risk. Any person who creates a false sensation of security in the minds of the workers can be punished for intentional violation of the law.

Other legal obligations of employers include reports of accidents to the Venezuelan Social Security Institute; instructions to workers on occupational health and safety; medical insurance, etc.

The statutory sanctions available to the courts are both criminal and civil. Violations of the law may be punished with imprisonment and/or civil liability. If an employer is a corporation, its legal representative, agent or manager is responsible for the violation and is liable for a prison term of two years in case of temporary incapacity of the worker and six years for permanent incapacity. In case of death of the worker, the term is seven to eight years prison.

However, the civil or criminal penalties may be reduced, if the accident is due to the negligence or imprudence of the worker.

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