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Authoritarian neoliberalism and the disciplining of labour

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In book: States of Discipline: Authoritarian Neoliberalism and the Contested Reproduction of Capitalist Order, Chapter: 2, Publisher: Rowman and Littlefield, Editors: Cemal Burak Tansel
Authors and Editors
The rise of authoritarian forms of neoliberalism has been well-documented in the literature which has mainly focused on various reforms that have removed key decision-making arenas from democratic control. As Ian Bruff (2014) skilfully highlights, this is not a new process 1 but rather the continuation of a key characteristic of neoliberal governance. While the return of authoritarian forms to European states is crucial to understand the current crisis management strategies of states and capital, we still lack an understanding of the concrete forms in which this authoritarian turn is being developed, deepened, and, more importantly, challenged and contested. In this chapter, we explore the ways in which authoritarian neoliberalism finds expression in and against labour, and how, labour’s agency shapes, contests and subverts such strategies.
Chapter 2
Authoritarian Neoliberalism and
the Disciplining of Labour
Mònica Clua-Losada and Olatz Ribera-Almandoz
The rise of authoritarian forms of neoliberalism is now well documented in
the political economy literature even though the focus has been on various
reforms that remove key decision-making arenas from democratic control.1
As Ian Bruff (2014) skilfully highlights, this is not a new process but rather
the continuation of a key characteristic of neoliberal governance. While rec-
ognizing the return of authoritarian forms to European states is crucial for
understanding the current crisis management strategies of states and capital,
we still need a deeper understanding of the concrete forms in which this
authoritarian turn is being developed, deepened, and, more importantly, chal-
lenged and contested. In this chapter, we explore the ways in which authori-
tarian neoliberalism finds expression in and against labour and how labour’s
agency shapes, contests and subverts such strategies.
It has become clear that the last 40 years of neoliberal rule have brought
about an international lowering of wage shares (see Bengtsson and Ryner
2015), leading to a rise in the amount of workers who, even after receiving a
salary, cannot be lifted above the poverty line (Pradella 2015). This has been
reinforced by a direct attack on corporatist structures and what some have al-
ready heralded as the crisis of ‘working class politics’ (Panitch 1986). These
deep processes of change mean that there has been an increasing ‘domination
of the executive arm of the state over the legislature … the objective “decline
of Parliament” within the state system’ (Panitch 1986: 229). This process of
blinding the democratic decision-making arenas needs to be considered in
relation to specific historical formations. The case used in this chapter, Spain,
provides a fascinating example as it never truly developed a democratic wel-
fare state (Navarro 2006). Furthermore, by focusing on the disciplining power
of authoritarian neoliberalism on labour, we can understand how authoritarian
neoliberalism has a deepening impact on what Poulantzas (1978) termed the
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30 Mònica Clua-Losada and Olatz Ribera-Almandoz
isolation effect. Here, we understand the isolation effect as the atomization
of the social body through ‘the constitution of the legal-individual citizen’
(Hall 1980: 62). Authoritarian neoliberalism deepens the isolation effect in
labour relations by further individualizing labour laws and weakening collec-
tive bargaining processes and institutions—a development that has been well
documented in other cases of the European South.2 A key characteristic of
this isolation effect on labour has been the clear erosion of collective bargain-
ing systems and labour legislation. As this chapter will show, this is a broad
trend that encompasses not just legislative and regulatory changes but also the
atomization of employment contractual relations. For instance, in the case of
Telefónica, which we use as a paradigmatic example of these trends, there
has been a division of tasks among a myriad of small companies as well as a
company-level change, where previously employed workers have now been
forced to become self-employed.
Labour in this chapter is utilized in a broad historical materialist sense.3 We
understand labour as both a social relation and the driver of class struggle.
Within the context of this chapter, the disciplining of labour is considered to
be occurring simultaneously in the arenas of production and reproduction.
In other words, the disciplinary strategies devised against labour encompass
both the curtailment of labour rights and the reduction in social rights. There-
fore, we will consider the type of general disciplining of labour (the structural
disciplining) as well as the organizational disciplining of labour (expressed in
the attacks on the collective organizations of the working class, trade unions).
To fulfil this objective, the chapter develops two key sections. We first
discuss the general disciplining of labour under authoritarian neoliberalism
with reference to the Spanish context. Here, we trace three vital ways in which
this process is being carried out: (1) the constitutionalization of previously
democratic arenas, which has been extensively highlighted by the literature
(e.g. Sandbeck and Schneider 2014 and Obendorfer 2015); (2) the growing
judicialization of politics, with the use of the Constitutional Court as an addi-
tional parliamentary upper chamber primarily focused on recentralizing Span-
ish politics; (3) the elimination of parliamentary debates with the excessive
use of royal decrees as a tool for creating new legislation. As we will show,
this trend has been particularly acute in relation to both labour legislation and
bills related to the imposition of austerity measures on welfare state services.
We then focus on a specific case study, which we maintain should help us
disentangle the specific and concrete ways in which these processes are played
out and, crucially, contested, resisted and subverted. We have chosen Tele-
fónica (now Movistar) as it has been, historically, one of the largest employers
in Spain. Telefónica was the state-owned telecommunications company that
has consistently been one of the most profitable public companies in Spain.
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Authoritarian Neoliberalism and the Disciplining of Labour 31
It was a company that had been closely linked with the political economy of
Spain. It underwent the longest privatization process in Spain—Franco had
already started the sale of shares before his death—finally being privatized
by the first Aznar government (People’s Party, 1996–2000) by royal decree.
It has been key to the, often failed, internationalization efforts of the Spanish
economy to become a key global telecommunications player (e.g. it owned
O2 in the United Kingdom until 2015). Currently, having changed its name to
Movistar (the affiliate company dedicated to mobile technologies), it is at the
forefront of developing new mobile technologies and hosts the annual Mobile
World Congress in Barcelona, the largest event of its kind in the world.
It is in this last part of the chapter that we return to the key issues of con-
testation, resistance and subversion, which are often left out of discussions on
authoritarian neoliberalism. The authoritarian attack is so overwhelming that
we can be forgiven when we forget the types of contestation, subversion and
resistance that occur from below. Yet, the case of Telefónica/Movistar, which
in 2015 had one of its longest (and most economically damaging) workers’
strike in their history, shows us that although the disciplining is fierce, the en-
during class struggles prevent capital from fully subduing our human dignity.
We propose that to understand the rise of authoritarian neoliberalism in
Spain, we need to conceptualize it as both an external and an internal process.
Unlike other state contexts with stronger liberal-democratic traditions, the
Spanish case presents a challenge to understanding the relationship between
representative democracy, neoliberalism and authoritarianism that goes be-
yond the scope of this chapter. However, we can point out that in cases where
transitions to democracy have not represented a break with the authoritarian
structures of the state, as has been the case in Spain, neoliberalism has devel-
oped in a context of arrested democracy. Let us briefly expand on this. While
representative democracy in Spain brought about the rolling out of political
rights after 1978, it did little to entrench civil rights into Spanish political
life and culture.4 In fact, it was not until the Socialist Workers’ Party (PSOE)
government of 2004–2008 under the leadership of José Luis Rodríguez Za-
patero that any attempt was made to redress this situation. The attempt was
short lived and the economic crisis became a convenient excuse to hinder the
advance of civil rights in Spain. Furthermore, the election of a People’s Party
(PP) government at the end of 2011, under strong Catholic influences, halted
such efforts with an attempt to return to a not-so-distant past.
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32 Mònica Clua-Losada and Olatz Ribera-Almandoz
The key fields subjected to external pressures for reform—as identified by
the IMF in their 2010 staff report, the first to highlight the dangerous extent of
the crisis in Spain—were pension funds, the labour market and banking. As we
will explore in this chapter, the choice of these policy areas is not a fortuitous
coincidence. Rather, it represents the areas where the state has been unable to
implement liberalization even after many years of continuous attempts to do
so and despite the fact that these attempts were accentuated by the process of
European integration (Clua-Losada 2015). In essence, the crisis has acted as
the necessary catalyst to create a situation of impending reform. Furthermore,
such a reform would have only ever been possible in a situation of weakened
trade unions and a weakened institutional Left. The reason behind this is the
fact that the 1978 elite pact, which secured the Spanish transition to democ-
racy, had managed to neutralize leftist opposition by institutionalizing key
Left parties and trade unions, while simultaneously depoliticizing civil society.
In this chapter, we are focusing on the internal forms of authoritarian neolib-
eralism and how they relate to labour. As Bruff (2014: 115) has argued, authori-
tarian neoliberalism can ultimately be observed in the processes that insulate
policies and institutions from dissent. In the Spanish context, such tendencies
can best be observed not just by focusing on authoritarian neoliberalism as an
externally imposed practice but rather as a process often driven by internal de-
velopments and struggles. As is widely acknowledged, there is clear asymmetry
in EU regulation in relation to how labour and welfare matters have been largely
left to the mercy of member states and their internal political processes (Taylor-
Gooby 2008). As many before us have pointed out (e.g. Grahl and Teague
2013), monetary union left member states with only one tool of macroeconomic
management, that is, internal devaluation, the process whereby macroeconomic
competitiveness is achieved by reducing wages (whether directly or indirectly)
and a reduction of public expenditure.5 By removing other monetary policy
choices from member states, popular demands have been effectively isolated
from previously democratic arenas of decision-making. If governments can no
longer offer certain policy alternatives, the state is essentially divorced from
popular demands. While this is not a new process, the current crisis has ex-
panded the reach of issues that can be removed from the political arena.
There are three key internal forms of authoritarian neoliberalism in Spain
which have become accentuated since 2010. First is the introduction of Ar-
ticle 135 into the 1978 Spanish Constitution by the PSOE, with the approval
of the conservative PP. Article 135 transposes the deployment of structural
deficit caps from the 2011 Fiscal Pact.6 Essentially, this means that future
public expenditure will be constitutionally curtailed, and therefore, future
expansions of the welfare state will not be possible within the existing con-
stitutional framework.
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Authoritarian Neoliberalism and the Disciplining of Labour 33
Second, there has been a growing judicialization of politics in the Spanish
state, particularly since 2010. This has been particularly marked by the use of
the Constitutional Court as a de facto upper chamber. This process was par-
ticularly evident during the PP government of Mariano Rajoy (2011–2015).
It has become clear that the Constitutional Court has been used against the
Autonomous Communities that have tried to go against the central govern-
ment’s political choices. In the Spanish context, Autonomous Communities
have had the majority of welfare state services devolved to them (health,
social care, education, etc.).7 However, as they have limited tax-raising pow-
ers, most of their income comes from the state. This means that in a context
of severe austerity, their ability to provide essential services is beyond their
political will. The use of the Constitutional Court against decisions made in
the Autonomous Parliaments shows a clear element of recentralization in
Spanish politics.
Third, while the use of royal decrees as a way of passing controversial or
urgent legislation in the Spanish Congress is neither new nor a tool used only
by the PP,8 it has been used consistently more often than before since 2011.
The Rajoy government (2011–2015) approved 33.8 per cent of its legislation
by royal decrees, thereby removing any possibility of parliamentary delib-
eration. Considering that the PP had an absolute majority in Congress, there
was no actual need to overuse royal decrees unless the aim was to remove
democratic deliberation from the public sphere.
The remainder of this section will focus on two key royal decrees which
have drastically changed the shape of labour relations in Spain. First is
the 2010 Royal Decree Law on Urgent Measures for Reforming the La-
bour Market. This royal decree law, promoted by the previous Socialist
government, focuses on individualized labour relations by decentralizing
collective bargaining. This was a big blow to the unions, as they had won
in the 1980s the ability to set up collective bargaining at the sectoral level.
Considering the productive structure of Spain, the obtainment of this right
was crucial. In the Spanish case, the majority of workers are employed
by small or medium-sized enterprises (SMEs), hence the ability to cover
non-unionized workers under broad sector-level agreements increased the
structural power of trade unions. By decentralizing collective bargaining to
the company level, what was being done, in reality, was the destruction of
the collective bargaining protections and institutions built up over the pre-
vious 30 years. Let us review the issues raised by the royal decree law step
by step. The labour reform approved by the royal decree law in June 2010
stipulated (1) the reduction of severance pay to 33 days per year of tenure
for unfair dismissal (previously 45 days was the norm) for almost all new
permanent contracts; (2) financing eight days of all severance payments
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34 Mònica Clua-Losada and Olatz Ribera-Almandoz
via a fund paid for by firms; (3) easing the criteria for ‘fair’ dismissal
(which would entail 20 days’ severance payment); and (4) broadening the
conditions under which firms can opt out of collective wage agreements
(IMF 2010). Other reforms included revising the conditions of temporary
contracts, increasing internal flexibility of firms (e.g. working hours) and
opening labour intermediation more broadly to private firms.
As already mentioned, this labour reform was a direct attack on the per-
ceived power of trade unions in Spain. It reinforced the idea that employ-
ers are hampered by a legislation that disproportionately protects workers.
The uneven relationship between the employers and workers, according to
the IMF staff report, was due to the high union density among permanent
workers in Spain, which was linked to the view that temporary employment
is high in Spain due to the high costs of dismissal. However, it appears
that although high dismissal costs have been created as an imperative for
reform, they may not be the key to solving the unemployment crisis. It is
compelling the way in which the IMF links dismissal costs with temporary
employment, particularly as both Ireland and Sweden have much lower
rates of temporary workers, yet they have higher severance payments for
unfair dismissals.
Spain has a large and structural unemployment problem, which poses
important challenges to trade unions (Campos Lima and Martín Artiles
2011). Throughout the crisis, Spain’s unemployment rate has been more
than double the EU27 rate and remained consistently above 20 per cent.
The problem has worried international financial institutions for some time
now, which brought about the advancement of labour market flexibilization
as a solution. The Spanish labour market is characterized by what has often
been termed a dual system of employment. An increasingly smaller propor-
tion of permanent workers—who enjoy security of employment and wage
increases linked to inflation—coexists with a growing majority of workers
in temporary contracts.
Since the late 1980s, successive governments have attempted to deal with
the perceived rigidities of the Spanish labour market. The first reforms led
to the creation of temporary forms of employment, which have served gov-
ernments well in periods of economic growth. However, in periods of crisis,
unemployment spirals upwards more easily than in other countries as most
temporary contracts are not renewed in such periods. Lowering permanent
workers’ dismissal costs is expected to reduce incentives to use temporary
contracts. High levels of temporary, short-term contracts are seen as a key
weakness of the Spanish labour market, together with having wage increases
linked to inflation and low productivity.
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Authoritarian Neoliberalism and the Disciplining of Labour 35
Orthodox arguments about the Spanish economy reveal a basic contradiction.
While the two key problems of unemployment and low labour productivity are
widely acknowledged (with varying degrees of evidence being presented), the
solution offered by most politicians, international organizations and mainstream
economists is to move from a labour-intensive economy to a capital-intensive
one, which would clearly provoke a rise in unemployment. This is particularly
so in the case of Spain, as the industries which have typically absorbed such
surplus labour in Northern and Western European countries are those related
to the welfare state, in other words, the caring professions. In Spain, such work
is still carried out largely in the domestic sphere, therefore lacking the required
level of marketization necessary to absorb the redundant labour force.
The next problem identified by the IMF was that wages are linked to in-
flation rather than to productivity. The reform also touched upon this issue,
allowing employers to opt out of collective agreements. This is considered a
significant issue by many scholars too, and low productivity is attributed to
labour (Royo 2009: 448). Interestingly, little evidence is produced for such
arguments. In fact, there appears to be other public policy problems that con-
tribute to low productivity, for example, problems in the education system
as well as issues of low capital investment. The real issue, however, is the
avoidance of real reform. The Spanish welfare state has been built around
the heavy subsidization of employment creation. Subsidies take a large share
of the public money destined for reductions in unemployment. A significant
amount of these funds are used to subsidize employers (over 30 per cent), and
yet unemployment remains a key problem.
The second labour reform we want to consider is a more recent one, also
approved by a royal decree, this time by the PP government in 2012. This
labour reform should be seen as the continuation of the one in 2010; how-
ever, in 2012, an the attack was far more direct on the workers as it stipulated
the reduction of wages and projected an increased threat of unemployment.
There were three key changes introduced by the reform which (1) allowed
companies to reduce workers’ salaries according to their profits, (2) increased
the cases under which companies can utilize EREs,9 and (3) emphasized an
increase in the type of apprenticeship contracts that can be created, leading to
a rise in mini-jobs and zero-hours contracts.
Having considered the ways in which the disciplining of labour has taken
place in the Spanish context, we will now move to see how these processes are
reproduced at the firm level. We are doing so to highlight that these processes
not only produce disciplining effects that target labour, but are also contested
and resisted by the workers themselves. Ultimately, in tracing the interactions at
the firm level, we find capital’s inability to fully discipline and control labour.
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36 Mònica Clua-Losada and Olatz Ribera-Almandoz
The process of privatizations in Spain consisted of a gradual divestment of
public assets rather than a rapid mass sale of public companies. The first
important phase of privatizations was launched by the Socialist Party gov-
ernment of Felipe González (1982–1996). Using the term ‘public divestment
process’, the government closed small and medium-sized ‘unprofitable’
public companies, sold large industrial enterprises to transnational compa-
nies and sold block shares of large public companies, industries and financial
institutions (Costas and Bel 2000: 233). This initial wave of partial privatiza-
tions was intensified under the Conservative government of José María Aznar
(1996–2004). Through the Modernization Programme for the Public Business
Sector (Programa de Modernización del Sector Público Empresarial), the
cabinet completely privatized 43 public companies in key sectors of the Span-
ish economy, such as electricity, gas, oil, transport and telecommunications.
This disposal of public property, which mainly affected large and profitable
companies, entailed a drastic reduction in the importance of public sector
enterprises in the economy and responded, at least in part, to the need to meet
the convergence criteria established by the Maastricht Treaty signed in 1992
(Ortega and Sánchez 2002: 35).
In this context, the case of Telefónica is one of the most significant exam-
ples of the gradual privatization and labour disciplining processes in Spain,
and it shows the crucial role that the state has played in restructuring capi-
tal–labour relations in the country over the last few decades. The company
was created in 1924 under the name CTNE (Compañía Telefónica Nacional
de España [Spanish National Telephone Company]), and it enjoyed a legal
monopoly over telephone services in Spain until 1998 (Calvo 2010). In 1945,
during Franco’s dictatorship, the Spanish government acquired 79.6 per cent
of CTNE shares (Telefónica 2016), an ownership percentage that was diluted
over the following decades through subsequent share capital increases. Fur-
thermore, like many other public companies, Telefónica experienced a partial
privatization in 1995 under the Socialist government, although it was not
entirely privatized until 1999, when the PP government sold the remaining
20.9 per cent of shares that the state still owned (Sociedad Estatal de Partici-
paciones Industriales 2014; Telefónica 2016). Concomitantly, and using its
linguistic advantage, Telefónica began a process of international expansion
into the Latin American markets (Rodríguez-Ruiz 2014).
Despite its privatization, the state maintained close ties with the company.
In 1996, Juan Villalonga was appointed CEO of Telefónica, a position he held
until 2000. Villalonga was proposed by the main shareholders of the company
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Authoritarian Neoliberalism and the Disciplining of Labour 37
(the banks Argentaria, Banco Bilbao and La Caixa), and with the endorsement
of the Prime Minister of Spain José María Aznar, who was his schoolmate and
childhood friend (Aznar 2012). This is not the only example of the political
ties enjoyed by the firm, as several prominent political figures have been hired
by the company or have been elected to its board of directors. These connec-
tions include Narcís Serra (member of PSOE, mayor of Barcelona 1979–1982,
Minister of Defence 1982–1991 and vice president of the Spanish govern-
ment 1991–1995), Javier de Paz (member of PSOE, general secretary of the
Socialist Youth of Spain and member of the Executive Council of PSOE,
1984–1993), Trinidad Jiménez (member of PSOE, Minister of Health and
Social Affairs 2009–2010, Minister of Foreign Affairs 2010–2011), Paloma
Villa (Trinidad Jiménez’s political consultant and spouse of the Socialist poli-
tician Eduardo Madina), Rodrigo Rato (member of PP, Minister of Economy
1996–2004, vice president of the Spanish government 2003–2004 and the 9th
managing director of the IMF 2004–2007), Elvira Fernández Balboa (spouse
of the current Prime Minister of Spain, Mariano Rajoy), Andrea Fabra (mem-
ber of the PP), José Ivan Rosa (spouse of the current vice president, Soraya
Sáenz de Santamaría), Eduardo Zaplana (member of the PP, president of
the government of Valencia 1995–2002 and Minister of Employment and
Social Affairs 2002–2004) and Yolanda Barcina (member of the Navarrese
Peopleʼs Union—a party with strong links to and recurrent coalitions with the
PP—president of the government of Navarre 2011–2015). Furthermore, José
Fernando Almansa (head of the Royal Household of Spain between 1993 and
2002) and Iñaki Urdangarín (member of the Royal Family and the brother-in-
law of the current king of Spain) have held important positions in different
international branches of the company. Similar cases of ‘revolving doors’ can
be found in other privatized companies such as Endesa—for which the ex-
Prime Minister José María Aznar worked as an external consultant—Repsol,
Tabacalera, Argentaria or Gas Natural, the last of which included ex-Prime
Minister Felipe González in its board of directors.
Before its complete privatization, Telefónica was one of the most con-
sistently profitable public companies in Spain, with a net income of €551
million in 1994 and €1,804 million in 1999. In 1994, Telefónica employed
a workforce of around 72,207 people, which made it one of the largest em-
ployers in the country (Telefónica 1994, 1999). As a result of privatization,
however, the company initiated a process of workforce reduction through
the launch of several consecutive dismissal programmes (EREs) and the out-
sourcing of key services such as sales, customer services and maintenance,
which were formerly provided internally. Following the rationale of cutting
labour costs, the workforce of Telefónica España was reduced within 20 years
by nearly 60 per cent to 30,020 employees in 2014 (Telefónica 2014). At the
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38 Mònica Clua-Losada and Olatz Ribera-Almandoz
same time, this contraction of the workforce had to be compensated with the
use of the services of outsourced workers, including hundreds of contractors,
subcontractors and self-employed workers. The restructuring of Spanish tele-
communications was by no means an isolated case but was part of a broader
international pattern of privatizations, corporate downsizing and deregula-
tion of former state-owned companies carried out in the 1980s, 1990s and
early 2000s. In countries such as the United States, the United Kingdom,
Ireland and Germany, telecommunication companies adopted a business
model based on the separation between, on the one hand, the management
and running of the network infrastructure, and on the other, the provision of
services (MacKenzie 2010). In all these cases and particularly in the case of
Telefónica, by extending the use of subcontracted labour, an important share
of the workforce was left outside existing collective bargaining agreements.
Consequently, precariousness and the lack of secure employment in the sec-
tor increased while the bargaining power of traditionally highly coordinated
trade unions was undermined and diluted (Rodríguez-Ruiz 2014).
Nevertheless, the workforce of Telefónica was not only the largest in
the country, but also one of the most militant. It has been argued that the
dismissal programmes in the 1990s and 2000s were carried out with the ac-
ceptance of both employers and workers since they offered ‘favourable exit
conditions’, including early retirements and relocations (Rodríguez-Ruiz
2014). However, since Telefónica employees were replaced by subcontracted
workers en masse, disputes were not reduced as expected, but transferred
to the outsourced companies. One of the best-known cases was the Campa-
mento de la Esperanza (the Camp of Hope), a campsite built between January
and August 2001 by around 1,500 workers of the Telefónica network installer
subcontractor Sintel. The firm had been part of Telefónica until 1996, when it
was sold to the US company MasTec, owned by Cuban exile and anti-Castro
leader Jorge Mas Canosa. In 2000, Sintel, which employed around 1,800 peo-
ple, declared bankruptcy. After six months without receiving their salary and
facing the threat of a redundancy programme—the first large-scale ERE ex-
ecuted in Spain—Sintel workers set out their tents in Paseo de la Castellana,
one of the major avenues in Madrid. The location had an enormous symbolic
resonance since there is a high concentration of important public and private
buildings, such as the main ministries and embassies, financial institutions
and the Real Madrid football stadium. Gradually, tents were replaced by
handmade cabins, electricity and water were tapped and amenities—such as
bathrooms, kitchens, a library, a museum, a meeting hall and portable swim-
ming pools—were built (Tremlett 2001). In a display of creative organizing,
workers used the occupation of public space not only as a form of protest
against Sintel’s owners, Telefónica or the Conservative government led at the
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Authoritarian Neoliberalism and the Disciplining of Labour 39
time by José María Aznar, but also as a way of showing their technical skills
to the passersby (Martínez Lucio 2011). The occupation demonstrated that
the challenge produced by the lack of a fixed working location and therefore
the impossibility of occupying a specific workplace and the related difficul-
ties of coordination among workers could be overcome through a highly
strategic and innovative struggle that gained great public and media recogni-
tion. Their organizational strength and the prefigurative aspects of the protest
were, at that time, relatively rare within Spanish labour struggles.
After 187 days, an agreement was reached between Sintel’s works council
and the Spanish government, which led to the dismantling of the Camp of
Hope. The deal included the reimbursement of unpaid salaries, early retire-
ments and relocation of the majority of workers to other telecommunication
companies. Years later, Sintel’s former workers complained that the main
points of the agreement were not only unfulfilled, but were also used as an ex-
cuse for creating new outsourced companies providing services to Telefónica.
In the words of the union delegates and workers participating in the protest,
‘the cause of this defeat was not the lack of will of [Sintel and Telefónica]
workers, but the acceptance by trade union leaders of massive redundancies
and the following outsourcing and labour precariousness that continues to this
day’ (quoted in Ubico 2016).
Consequently, after years promoting the atomization and territorial disper-
sion of the labour force, Telefónica currently hires the services of 10 differ-
ent contractors—namely, Abentel, Cobra, Comfica, Cotronic, Dominion,
Elecnor, Itete, Liteyca, Montelnor and Teleco—which, at the same time,
receive services from more than 600 suppliers, including both subcontractors
and self-employed workers. Furthermore, according to the Spanish Workers’
Statute Law, companies with fewer than 50 workers are not entitled to have
a works committee or to have workers’ delegates if they have fewer than
10 workers, which limits workers’ organizations in most of these smaller
subcontractors and suppliers (Ley del Estatuto de los Trabajadores 1995,
Articles 62 and 63). The law is effectively used as a means of hindering the
workers’ capacity of mobilization and coordination, as well as impeding the
establishment of solidarity links between them. Although all these companies
work directly or indirectly for Telefónica, the idea of being in competition
against each other is used as a justification for reducing employees’ salaries
and imposing more precarious working conditions, which frequently leads
to significant reductions in health and safety standards. As a member of Co-
tronic’s workers’ committee puts it, ‘In qualitative terms, the precarity and
contraction of [Telefónica’s] labour force forces us to work from sunrise to
sunset, to break the laws on labour risk prevention, and to lose fundamental
rights, such as receiving overtime pay, having trade union representation in
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40 Mònica Clua-Losada and Olatz Ribera-Almandoz
the workplace, or being covered by the collective agreement for the metal
sector’ (quoted in Ubico 2016).
In 2011, Telefónica was the fifth largest operator by total customers in
the world (Rodríguez-Ruiz 2015). However, despite registering a record
net income of more than €10,000 million in the previous accounting period
(Telefónica 2011), the company used the economic crisis as an excuse to
announce a new redundancy plan that would cause the dismissal of some 20
per cent of the workforce—around 8,500 employees, a number that was later
reduced to 6,500—between 2011 and 2013. Concomitantly, the company
has one of the biggest pay gaps between executives and median workers in
Spain. In 2014, the then CEO of the firm, César Alierta, received €550,000
per month—that is, an annual payment of €6.6 million—whereas the aver-
age salary of a permanent employee was around €2,000–2,200 per month
(Comisión Nacional del Mercado de Valores 2014). The difference is even
more dramatic for the contract workers (e.g. Cotronic workers receive a
maximum salary of €1,480 per month), subcontracted workers (with salaries
of around €800 per month) and self-employed (€700–800 per month). The
situation of the latter is even more precarious given that they have to deduct
the vehicle and equipment expenses, taxes and social security contributions
from their earnings. A self-employed technician explains the double exploi-
tation they face as follows:
Some years ago, being self-employed was a minority option, and only people who
wanted to have more flexible schedules would choose it. However, the majority of
the current self-employed are former employees of [Telefónica’s] contractors. Back
then, we had a company car, holidays. … But they decided that this wasn’t profit-
able enough, so we needed to be fired. They promised important compensations for
our dismissals, and that we would keep working for them as self-employed with
€2,500 per month salaries—until then, we earned €1,000 per month. We realized
too late that, after discounting all the expenses and taxes we had to face, the €2,500
turned into €500. As self-employed, we had lost all labour rights. And if we wanted
to negotiate with Telefónica, they told us ‘you are an enterprise now!’10
In 2015, however, the increasing sense of frustration reached a turning point
and Spain witnessed a wave of mobilizations comprising Telefónica’s con-
tractors, subcontractors and self-employed workers. Rallying around slogans
such as ‘They took so much from us that even fear was taken away’ [‘Nos
quitaron tanto, tanto, que nos quitaron el miedo’], workers from Barcelona,
Madrid, Bilbao, Seville and other Spanish cities began an indefinite strike
to express their demands. The aim of the action was to denounce the dete-
rioration of the existing working conditions, the workers’ heightened sense
of insecurity and their growing material needs, which were seen not only as
16_892_Tansel.indb 40 1/25/17 8:04 AM
Authoritarian Neoliberalism and the Disciplining of Labour 41
a direct result of the socioeconomic crisis, but also as the outcome of the
firm’s privatization and restructuring which started in the 1990s. This was
the first strike organized by self-employed workers in Spanish history. It was
able to mobilize a large number of workers precisely because they had been
employed by multiple contractors and subcontractors before the beginning of
the crisis, and they had thus built strong networks that ultimately were used
to coordinate the actions. The campaign was known as ‘The Ladders Revolu-
tion’ [‘Revolución de las escaleras’] in reference to the ladders used by the
telecommunications technicians to install and fix telephone and Internet wires
(Sanz Sabido and Price 2016). This strike action was organized and coordi-
nated outside of the established trade unions, which were perceived as inca-
pable of representing the workers’ interests. As a workers’ delegate stated:
If we ever reach any favourable agreement, it will be because of the grassroots
mobilization [and] the trade union bureaucracies will be forced to accept them
because of the workers’ pressure. … In Barcelona, our comrades organized
protests and demonstrations in front of the trade unions’ offices with the slogans
‘We fight, we negotiate’ and ‘They don’t represent us’. We are on strike in spite
of the unions’ manoeuvres to stop our mobilizations and to water down our
demands. (quoted in Ubico 2016)
Nevertheless, conventional strike action and demonstrations were soon per-
ceived as insufficient. Growing frustration with established channels, such as
trade unions, that were traditionally used to express workers’ demands led
workers to combine the strike with other forms of disruptive actions and pre-
figurative practices. An assembly of subcontracted technicians coordinated
by the grassroots trade unions CoBas (Sindicato de Comisiones de Base),
AST (Alternativa Sindical de Trabajadores) and CGT (Confederación Gen-
eral del Trabajo) decided on direct action and occupied the Telefónica build-
ing that houses the headquarters of the Mobile World Centre, a key landmark
in the heart of Barcelona. The occupation was used to attract the attention of
the media, as well as to launch a campaign focused on damaging the reputa-
tion of the company’s executives. Hence, the workers reproduced some of
the practices and strategies developed during the Camp of Hope, together
with taking advantage of the break that the 15-M cycle represented. As one
participating worker explained:
We had been accumulating a certain experience on the picket lines and in direct
actions, and that’s what people decided to do: we decided to enter the office in
order to make visible our conflict and our social movement, and also to establish
a continued alliance with other social movements, which was also opened up to
all those parties that wanted to participate.11
16_892_Tansel.indb 41 1/25/17 8:04 AM
42 Mònica Clua-Losada and Olatz Ribera-Almandoz
The 15-M cycle of struggle had direct implications for how resistance was
being perceived and organized by Spanish workers. The 15-M was a moment
of rupture not just with the way the crisis was being managed in Spain, but
also—and perhaps more importantly—with the established channels of politi-
cal and social representation. Both trade unions and left-wing parties were
the focus of vociferous criticism for having failed to provide an adequate
response to the crisis. Furthermore, they were identified as also being part of
the problem. The perceived lack of union opposition to the aforementioned
2010 Labour Reform (approved by the Socialist government)—despite a gen-
eral strike—was seen as further evidence of the inability of the established
organizations to provide a channel for resistance. The outcome has been an
increased level of contention outside and within existing organizations. It
could be argued that this was a positive outcome in workplaces where union-
ization was made difficult by structural conditions (such as the Telefónica
subcontracting system), as the accumulated experience since the 15-M in
community organizations and square occupations had been a great school of
prefigurative action for many people, including some of the Movistar strike
Furthermore, a week before local elections were held in Spain, some candi-
dates for mayor of Barcelona—Ada Colau from Barcelona en Comú, Alfred
Bosch from Esquerra Republicana de Catalunya (ERC) and Maria José Lecha
from Candidatura d’Unitat Popular (CUP), among other political leaders
entered into an agreement with the workers in which they committed not to
contract services from companies that did not guarantee a maximum of 40
working hours per week, two weekly rest days and fair salaries. Thanks to this
coordination with other social movements and political actors, direct negotia-
tion was forced between the company’s executives and the workers for the
first time without the mediation of the established trade unions.
The case presented here shows the nexus between state disciplining,
processes of privatization and the different moments of prefiguration that
workers’ struggles can establish. As such, it closely follows developments in
Spain’s authoritarian state project as well as the way in which each cycle of
struggle materializes. The latest developments demonstrate that the current
focus on occupying political institutions by many of the new 15-M-inspired
political parties may also bring synergies with existing workers’ struggles.
This chapter has focused on the effects of rising authoritarian neoliberalism on
the disciplining of labour. It has done so by utilizing the Spanish case to un-
cover the legal and executive dynamics behind authoritarian neoliberalism and
16_892_Tansel.indb 42 1/25/17 8:04 AM
Authoritarian Neoliberalism and the Disciplining of Labour 43
by considering the specific ways in which labour has been under direct attack
in the management of the crisis. While the Spanish case has already been high-
lighted in the literature as a key example of authoritarian neoliberal strategies,
we have not only identified ‘the authoritarian turn’ in Spain but also focused on
how it is negated, resisted and subverted by labour. The chapter has investigated
labour’s relationship with authoritarian neoliberalism by tracing the process
of privatization of Telefónica and the struggles this process has given birth to.
Telefónica has been a useful example to explore authoritarian neoliberalism as
it has provided us with a concrete nexus between authoritarianism, democracy
and neoliberalism within the Spanish context. More importantly, and in line with
our key argument, the case study reveals that authoritarian neoliberalism cannot
be understood simply as a mode of domination but rather as the inability of the
state to subdue and discipline labour. The Telefónica case demonstrates that
even in the most difficult circumstances, workers find ways to resist and subvert
the disciplining effects of authoritarian neoliberalism. It is in this sense that we
hope that this chapter contributes to a critical political economy of emancipation
rather than one focused on domination (Huke et al. 2015).
1. See, for example, Bruff (2014) on authoritarian neoliberalism; Sandbeck and
Schneider (2014) and Obendorfer (2015) for analyses of authoritarian constitutionalism.
2. See Campos Lima and Martín Artiles (2011); Koukiadaki and Kretsos (2012).
3. For more details on our conceptualization, see Clua-Losada and Horn (2014).
4. For more on the relationship between political and civil rights, see T. H. Mar-
shall’s (1997) classic work Citizenship and Social Class.
5. See also the chapters by Bruff and Sotiris in this book.
6. See Radice (2014) on the implications of structural deficit.
7. Autonomous Communities are the political and administrative divisions that
comprise the Spanish state and have devolved powers. There are 17 Autonomous
Communities, each with its own executive and legislative branch (Autonomous
Parliament). They have asymmetrically devolved powers; in other words, not all Au-
tonomous Communities have the same level of decentralized power. However, they
all have responsibility over education, health and social services.
8. For example, the last PSOE government under Zapatero’s premiership ap-
proved 56 royal decrees, which accounted for 29 per cent of approved legislation.
9. ERE (Expedientes de Regulación de Empleo) is a legal procedure utilized
for redundancies, traditionally used when companies go bust. Under this reform,
EREs can be used even in cases where the company requires only a temporary
10. Interview with Ariel Paso, self-employed technician quoted in La Directa.
Available at:
16_892_Tansel.indb 43 1/25/17 8:04 AM
44 Mònica Clua-Losada and Olatz Ribera-Almandoz
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