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Protection of Wages Convention, 1949 (No. 95) - Paraguay (RATIFICATION: 1966)

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The Committee notes the information provided by the Government, which answers the points raised in its previous direct request and has no further matters to raise in this regard.

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In order to provide a comprehensive view of the issues relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 26 and 99 (minimum wages) and 95 (protection of wages) in a single comment.

Minimum wage

Articles 1 and 3(1) and (2)(1) and (2), of Convention No. 26, and Articles 1 and 3(1), (2) and (3) of Convention No. 99. Scope of application. Minimum wage-fixing machinery. In its previous comments, the Committee requested the Government to provide additional information on the reform process of the minimum wage policy and any results achieved. The Committee notes the Government’s indication in its report that, following consultations with the social partners, the minimum wage-fixing machinery was reformed through the adoption of Act No. 5764 of 29 November 2016, which amended section 255 and repealed section 256 of the Labour Code. The Committee notes that: (i) section 255 of the Labour Code provides that the examination of the adjustment of the minimum wage shall be undertaken by the executive authorities upon the proposal of the National Minimum Wage Council (CONASAM) based on the interannual fluctuations in the consumer price index and their impact on the national economy, in June each year; (ii) the CNASAM is a tripartite body in which representatives of employers and workers participate in equal numbers (section 252 of the Labour Code); and (iii) following the reform, adjustments were adopted to the minimum wage for workers in the private sector and workers in agricultural undertakings in 2016, 2017 and 2018.
Article 4 of Conventions Nos 26 and 99. Supervision and sanctions. With reference to its previous comments, the Committee notes the information provided by the Government on labour inspections and judicial proceedings relating to the minimum wage between 2015 and 2017. It also notes the Government’s indications that the General Directorate of Labour is planning to launch awareness-raising campaigns for employers on compliance with the payment of the minimum wage and that it is making available to the workers concerned individual and collective dispute settlement channels for complaints by those who are paid wages below the statutory minimum level. The Committee requests the Government to provide information on the awareness-raising campaigns on payment of the minimum wage that have been launched or planned, and on the cases dealt with by the individual and collective dispute settlement services relating to the minimum wage, including the number of cases, the problems reported and the results achieved. The Committee also refers to its comments on the application of the Labour Inspection Convention, 1947 (No. 81).

Protection of wages

Article 2 of Convention No. 95. Scope of application. With reference to its previous comments, the Committee notes the Government’s indication that the provisions of the Convention are applied to all persons in a dependent employment relationship at the national level and that they are implemented in the Labour Code.
Article 4(1). Partial payment of wages in kind. Prohibition of the payment of wages in the form of liquor of high alcoholic content or noxious drugs. With reference to its previous comments, the Committee notes the Government’s indication that: (i) the payment of wages in the form of liquor of high alcoholic content or noxious drugs is prohibited, as such forms of payment do not comply with the requirement that they be appropriate for the personal use and benefit of the worker and her or his family, as set out in section 231 of the Labour Code in respect of the partial payment of wages in kind; (ii) no complaints have been lodged by workers, including agricultural workers, concerning payments in the form of liquor of high alcoholic content or noxious drugs; and (iii) section 392 of the Labour Code provides that any employer who sets up at the workplace stores selling intoxicating drinks or drugs, or gambling facilities, shall be liable to a fine of a minimum of 30 days’ wages, which shall be doubled in the event of a repeat offence.
Articles 3, 6, 7(1) and 12(1). Payment of wages in legal tender and prohibition of payment in a form alleged to represent legal tender. Prohibition on limiting the freedom of workers to dispose of their wages. Prohibition of any coercion on workers to make use of works stores. Regular payment of wages. With reference to its previous comments, the Committee notes the information provided by the Government on the measures adopted in relation to the issue of forced labour, including inspections and visits in the Paraguayan Chaco region with a view to ascertaining working conditions. Recalling that this subject is being examined in the framework of the Forced Labour Convention, 1930 (No. 29), and the Indigenous and Tribal Peoples Convention, 1989 (No. 169), the Committee refers to its comments on the application of these Conventions.

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Articles 2, 3, 4, 6, 7 and 12 of the Convention. Scope of application – Payment of wages in kind – Indigenous workers. The Committee has been drawing the Government’s attention for several years to the need to extend the coverage of the provisions of the Labour Code regarding protection of wages to agricultural workers and also the need to consider the introduction of an express provision prohibiting the partial payment of wages in the form of liquor of high alcoholic content or noxious drugs. In addition, the Committee has been commenting on the situation of indigenous communities in the Chaco region and reported abusive pay practices which are linked to suspected debt bondage and forced labour situations. In its latest report, the Government essentially reproduces the information communicated in its 2009 report and provides no new information with respect to the Committee’s comments with the exception of aggregate statistics concerning labour inspection visits carried out in 2011. The Committee accordingly asks the Government to take the necessary measures as a matter of priority in order to: (i) bring agricultural workers within the scope of application of the Convention, so as to enjoy with respect to their wages the protective coverage of the Labour Code; (ii) ensure that full effect is given to the requirements of Article 4(1) of the Convention regarding payment of wages in the form of alcohol or drugs; and (iii) properly investigate and effectively prevent and punish any pay practices in relation to indigenous workers in the Paraguayan Chaco region which would not comply with the following requirements of the Convention: Article 3 (payment of wages in legal tender only, and not in vouchers or coupons), Article 6 (prohibition to limit in any manner the freedom of workers to dispose of their wages), Article 7 (prohibition of any coercion exerted to workers in relation to the use of works stores), and Article 12 (payment of wages at regular intervals). Furthermore, the Committee requests the Government to refer to its comments made under the Forced Labour Convention, 1930 (No. 29), and the Indigenous and Tribal Peoples Convention, 1989 (No. 169).

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Article 2 of the Convention. Scope of application – Agricultural workers. The Committee has been commenting for several years on section 162 of the Labour Code, which expressly excludes rural workers (except those engaged in work of an industrial character) from the provisions pertaining to the protection of wages. In the absence of a Government reply on this point, the Committee once again requests the Government to take appropriate action to ensure that the Convention is fully applied to all persons to whom wages are paid or payable, and that consequently the protective coverage of the Labour Code is extended to all agricultural workers.
Article 4(1). Partial payment of wages in kind. The Committee notes that the Government’s report is once more silent on any legislative provision prohibiting the payment of wages in the form of liquor of high alcoholic content or of noxious drugs, as prescribed by this Article of the Convention. The Committee refers to paragraph 137 of its 2003 General Survey on the protection of wages in which it pointed out that “implementing legislation may give effect to this requirement either by means of a specific prohibition or through an authorization clause excluding alcohol or drugs. While a specific prohibition may be the most effective manner of securing compliance with this provision, the Convention does not appear to go as far as requiring this. It would seem sufficient for any authorization for the payment of wages in kind contained in laws or regulations, collective agreements or arbitration awards to exclude the possibility of paying wages in the above forms, so that any practice of this kind attracts the penal or other sanctions applicable to unauthorized forms of payment in kind”. The Committee again requests the Government to take the necessary measures in order to give full effect to this requirement of the Convention.
Part V of the report form. Application in practice. The Committee requests the Government to continue providing general information on the manner in which the Convention is applied in practice, including, for example, information concerning the number of workers covered by the relevant legislation, extracts from reports of the inspection services indicating the number and nature of violations reported and penalties imposed, and any difficulties experienced in the application of the Convention.
[The Government is asked to reply in detail to the present comments in 2012.]

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Articles 3, 4, 6, 7 and 12 of the Convention. Debt bondage of indigenous communities in the Chaco region. Further to its previous comments concerning the debt bondage situation affecting thousands of indigenous workers in the Paraguayan Chaco, the Committee notes the Government’s explanations that it is focusing its efforts on sensitization campaigns and inspections of cattle farms and plantations. The Government adds that as a result of those awareness-raising activities, an unprecedented number of requests have been received concerning the application of labour laws and the protection of workers’ rights. The Committee welcomes the measures taken so far, in particular the labour inspection visits to rural establishments suspected of debt bondage practices, but recalls that such measures must be reinforced and lead to systematic action commensurate to the seriousness and extent of the problem. The Committee therefore asks the Government to provide detailed information on the results of the inspection visits to Chaco estates showing the number and nature of wages-related infringements observed and the sanctions imposed. Recalling that as documented in several ILO studies and official reports of the UN Permanent Forum on Indigenous Issues and the Inter-American Commission on Human Rights, debt bondage situations may result through delayed payment of wages, excessive pricing of company store goods, payment in kind instead of cash wages, and absence of wage records, the Committee requests the Government to specify any targeted action to ensure compliance with the requirements of Articles 3 (payment of wages in legal tender), 4 (partial payment of wages in kind), 6 (freedom of workers to dispose of their wages), 7 (works stores) and 12 (payment of wages at regular intervals) of the Convention. Furthermore, the Committee requests the Government to refer to its comments made under the Forced Labour Convention, 1930 (No. 29) and the Indigenous and Tribal Peoples Convention, 1989 (No. 169).
The Committee is raising other points in a request addressed directly to the Government.
[The Government is asked to reply in detail to the present comments in 2012.]

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Article 2 of the Convention. Scope of application – agricultural workers. Further to its previous comments concerning sections 157–191 of the Labour Code, which do not allow the full application of the provisions of the Convention to agricultural workers, the Committee notes the Government’s indication that it will take into account the need to amend the legislation in order to include the protection of the wages of those workers. It also notes the adoption of Decree No. 1968 of 6 May 2009, which provides for the meeting of a tripartite and inter-institutional social dialogue forum to discuss a new wages policy, in consultation with the social partners, and the strengthening of the powers of the Deputy Minister for Labour and Social Welfare concerning the supervision and application of the labour legislation. The Committee recalls that the Convention is applicable to all persons to whom wages are paid or payable, including agricultural workers. However, section 162 of the Labour Code stipulates that the general provisions of this Code, in particular those relating to the protection of wages, do not apply to agricultural workers. The Committee hopes that the Government will take the necessary measures without delay so that the wages of agricultural workers are protected in both law and practice. It requests the Government to keep the Office informed of any developments in this regard.

Article 4, paragraph 1. Partial payment of wages in kind. With regard to the prohibition of the payment of wages in the form of liquor of high alcoholic content or of noxious drugs, set out in Article 4(1) of the Convention, the Committee notes that the Government provides no new information on this matter. It therefore requests the Government once again to take the necessary measures to include in the legislation a provision expressly prohibiting the partial payment of wages in the form of noxious drugs or liquor of high alcoholic content, as required by this Article of the Convention.

Part V of the report form. Application in practice. The Committee notes the statistics provided by the Government. The Committee requests the Government to continue providing general information on the manner in which the Convention is applied in practice, including, for example, information concerning the number of workers covered by the relevant legislation, extracts from the reports of the inspection services indicating the number and nature of violations reported and penalties imposed, etc.

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Articles 3, 4, 6, 7 and 12 of the Convention. Debt bondage. Further to its previous comment concerning the problem of debt bondage affecting numerous indigenous workers in agricultural undertakings in the Paraguayan Chaco, the Committee notes the Government’s indications that a regional labour directorate has been created in the town of Teniente Irala Fernández (Central Chaco) in order, in particular, to supervise and prevent situations of forced labour, and inspections have been carried out in the context of the decent work programme in the agricultural sector. The Committee also notes the adoption of Resolution No. 230 of 27 March 2009 creating the Committee on Fundamental Rights at Work and the Prevention of Forced Labour, and Decree No. 1945 of 30 April 2009 approving the National Programme for Indigenous Peoples (PRONAPI). Furthermore, the Committee notes that the eradication of forced labour is one of the major components of the Decent Work Country Programme concluded with the ILO in February 2009. It recalls that, even if the legislative provisions exist, they still have to be applied effectively. In this regard, the Committee refers to paragraph 356 of the Global Report under the follow-up to the ILO Declaration on Fundamental Principles and Rights at Work (Report I(B)), submitted to the 98th Session of the International Labour Conference, 2009, in which it is emphasized that forced labour can only be eradicated “through integrated policies and programmes, mixing law enforcement with proactive measures of prevention and protection, and empowering those at risk of forced labour to defend their own rights”. The Committee therefore requests the Government to provide detailed information on the impact of the above measures on the working conditions of the workers concerned, in particular with regard to the application of Article 3 (payment of wages in legal tender), Article 4 (partial payment of wages in kind), Article 6 (freedom of workers to dispose of their wages), Article 7 (work stores) and Article 12 (payment of wages at regular intervals) of Convention No. 95.

Furthermore, the Committee requests the Government to refer to its comments under the Forced Labour Convention, 1930 (No. 29), and the Indigenous and Tribal Peoples Convention, 1989 (No. 169).

The Committee is raising other points in a request addressed directly to the Government.

[The Government is asked to reply in detail to the present comments in 2010.]

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The Committee notes the Government’s report and the voluminous documentation attached. However, it notes that the Government has not replied in full to its previous comment. It is therefore bound to raise once again the following points.

Article 2 of the Convention. Scope of application – Rural workers. With reference to its previous comment, the Committee notes that certain documents attached to the Government’s report relate to the conditions of employment of agricultural workers. It notes in particular resolution No. 311 of the Ministry of Justice and Labour, of 3 May 2006, fixing the minimum wage for workers employed in agricultural establishments. It also notes resolution No. 111 of the Ministry of Justice and Labour, of 24 February 1999, granting workers in a poultry enterprise coverage by section 247 of the Labour Code respecting the protection of wage claims by a privilege in the event of the bankruptcy of the employer. The Committee notes, however, that the provisions of the Labour Code determining its scope of application have not been amended. Accordingly, the conditions of employment of rural workers are still subject to specific provisions, namely sections 157 to 191 of the Labour Code, which do not give effect to the Convention. Furthermore, under the terms of section 162, the general provisions of the Labour Code, including those respecting the protection of wages, do not apply to rural workers, except to those engaged in work of an industrial character (production of cheese, wine, etc.).

The Committee recalls that the Convention applies to all persons to whom wages are paid or payable, including agricultural workers. It notes the Government’s indications that rural workers benefit from the same protection in relation to wages as industrial workers. However, it recalls that such protection has to be explicitly set out in the national legislation and cannot take the form of a mere practice. The Committee therefore hopes that the Government will take the necessary measures without further ado to amend the Labour Code and extend the scope of application of its provisions respecting the protection of wages to all agricultural workers. Such an amendment could, for example, take the form of a provision with wording similar to that of section 147 of the Labour Code respecting domestic workers.

Article 4, paragraph 1. Partial payment of wages in kind. The Committee notes that the Government refers to section 231 of the Labour Code, which allows the partial payment of wages in kind on an exceptional basis and within the limit of 30 per cent of the wage. It notes in this respect that section 231 follows the wording of Article 4, paragraph 2, of the Convention in requiring that allowances in kind be appropriate for the personal use and benefit of the worker and his family and that the value attributed to such allowances be fair and reasonable. The Committee however notes that the Labour Code fails to specify, as required by Article 4, paragraph 1, of the Convention, that the payment of wages in the form of liquor of high alcoholic content or of noxious drugs is prohibited under any circumstances. In this respect, it notes the Government’s reference to section 392 of the Labour Code, which establishes the penalties applicable to an employer who sets up taverns or outlets for drugs or gaming at the workplace. While this provision is undoubtedly positive for the protection of wages, it is not sufficient to give effect to Article 4, paragraph 2, of the Convention, which specifically covers arrangements for the partial payment of wages in kind. In the light of these explanations, the Committee hopes that the Government will adopt a provision in the very near future explicitly prohibiting the payment of wages in the form of noxious drugs or liquor of high alcoholic content, as required by the Convention.

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Articles 3, 4, 6, 7 and 12 of the Convention. Debt bondage. The Committee refers to the comments that it has been making for over ten years under the Forced Labour Convention, 1930 (No. 29), and the Indigenous and Tribal Peoples Convention, 1989 (No. 169), concerning the problem of debt bondage affecting indigenous populations, and particularly in the Paraguayan Chaco. It notes that this problem was also examined in 2006 by the Conference Committee on the Application of Standards, which invited the Government, among other things, to seek the Office’s technical assistance in this connection. Furthermore, the Committee notes the report Debt bondage and marginalization in the Paraguayan Chaco, published by the ILO in September 2006, which was endorsed at seminars held separately with employers’ and workers’ organizations, and with the labour inspection services. According to this report, in agricultural establishments in the Chaco, many indigenous permanent or temporary workers receive a wage that is lower than the minimum wage or are compelled to buy products at excessive prices in the establishment’s store. In certain cases, this results in situations of permanent debt in which the worker concerned is likely to be compelled to stay in the service of the establishment against her or his will, under the menace of imprisonment. The findings of the report show that nearly 8,000 indigenous workers are victims of forced labour or are likely to become so. The report’s recommendations include the formulation of a plan of action to eliminate forced labour with a view to eradicating debt bondage in the Chaco, the opening of a regional labour office and the strengthening of inspection activities.

As the Committee emphasized in the observation that it made in 2007 under Convention No. 29, the national legislation contains provisions which, if they were properly applied in practice, would contribute to preventing the chronic indebtedness of indigenous workers.

The Committee is bound to express concern in view of the gravity of the persistent practices of debt bondage in the Paraguayan Chaco, which constitute not only violations of Conventions Nos 29 and 169, but also raise serious problems of application of Articles 3 (payment of wages in legal tender), 4 (partial payment of wages in kind), 6 (freedom of the worker to dispose of her or his wages), 7 (works stores) and 12 (payment of wages regularly) of Convention No. 95. It therefore requests the Government to provide detailed information on the measures adopted in the context of the follow-up to the ILO study referred to above, and particularly with a view to the formulation and implementation of a national action plan in order to bring an end to debt bondage in the country.

The Committee is raising other matters in a request addressed directly to the Government.

[The Government is asked to reply in detail to the present comments in 2009.]

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The Committee notes the Government’s report and its annexes.

Article 2 of the Convention. The Committee recalls its previous direct request in which it noted that no provision in the new Labour Code, Act No. 213/93, as amended by Act No. 496/95, ensures the application of the provisions regarding the protection of wages to rural workers except for those engaged in work of an industrial character under section 162. In its reply, the Government affirms that in practice the Labour Code applies to all workers subject to the exceptions provided for therein, and refers to section 251 of the Labour Code regarding the establishment of different minimum wages for urban and rural areas. Recalling that under Article 2(1) of the Convention, its provisions are applicable to all persons to whom wages are paid or payable, and also that the Government has only excluded domestic workers from the application of the provisions of the Convention in accordance with Article 2(3) of the Convention, the Committee requests the Government to specify the legislative or regulatory provisions which ensure that all agricultural workers enjoy the same coverage with respect to wage protection.

Article 4(1). Further to its previous comment, the Committee notes that the Labour Code contains no provision expressly prohibiting wage payment in the form of liquors of high alcoholic content or of noxious drugs in any circumstances, as set forth under this Article of the Convention. In its reply, the Government refers to sections 231 and 390 of the Labour Code regarding the requirement to pay wages only in legal tender and the employer’s liability for paying wages in the form of promissory notes, vouchers or coupons, or in any other form alleged to represent legal tender. The Committee is bound to observe, in this connection, that the above provisions are strictly irrelevant to the regulation of wage payment in the form of allowances in kind, in particular payment in the form of alcoholic drinks or noxious drugs. It therefore asks the Government to indicate the measures taken or envisaged to ensure that full effect is given to the Convention in this regard.

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The Committee has noted the information supplied by the Government in its reports as well as the new Labour Code established by Act No. 213/93. It asks the Government to supply information on the following points.

Article 2 of the Convention. The Committee notes that Chapter V of the Labour Code dealing with rural workers (Book I, Title III) does not expressly lay down that the general provisions of the Code are applicable to these workers, contrary to what was the case in the old Code regarding forestry (section 179 of the old Code) and in the chapters on home work (section 147) and on workers in the enterprises of motorized land transport (section 192) of the present Code. Please indicate whether the Labour Code in general and, more particularly, its provisions regarding the protection of wages are applicable to rural workers other than those in work of industrial character, who are already covered by virtue of section 162.

Article 4(1). The Committee recalls that section 232 of the old Code was modified by Act No. 506 of 27 December 1974 and brought into conformity with this provision of the Convention (prohibition to pay wages in the form of alcoholic liquors or noxious drugs). Noting that the new Code does not contain such prohibition, the Committee asks the Government to indicate how effect is given to this provision of the Convention.

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