Observation (CEACR) - adopted 2017, published 107th ILC session (2018)

Right to Organise and Collective Bargaining Convention, 1949 (No. 98) - Nepal (Ratification: 1996)

The Committee notes that the Government’s report has not been received.

The Committee takes note of the observations provided by the International Trade Union Confederation (ITUC) in a communication received on 1 September 2017 as well as the Government’s reply thereon. With respect to the ITUC’s allegations of a brutal attack by police to health workers during a demonstration outside the Parsa District Public Health Office in Birgunj, the Committee notes that the Government states that police intervention was necessary in order to ensure the supply of essential medicines. In this respect the Committee recalls that police intervention should be limited to cases where there is a genuine threat to public order and that governments should take measures to ensure that the competent authorities receive adequate instructions so as to avoid the danger of excessive violence in trying to control demonstrations that might undermine public order. The Committee also recalls that it had previously requested the Government to conduct an investigation in relation to issues highlighted by the ITUC in previous years concerning anti-union dismissals, threats against trade union members and the weakness of collective bargaining given that collective agreements only cover a very small percentage of workers in the formal economy. The Committee requests the Government to communicate the findings of such investigation as well as information on the eventual remedies adopted. It also requests the Government to provide its comments with respect to the observations made by Education International in 2014.

Legislative reforms. The Committee notes that a new Constitution was adopted in 2015 and that a new Labour Act (Labour Act 2074), adopted on 4 September 2017, has repealed the Labour Act 1992. The Committee notes with interest that sections 17(2)(d) and 34(3) of the new Constitution provide that the rights to form a trade union, to participate in it, and to organize collective bargaining are fundamental rights. It also observes that section 8 of the new Labour Act recognizes the right to form a trade union, to participate in its activities and to acquire its membership or get affiliated with or involved in other union activities.

Article 1 of the Convention. Adequate protection against anti-union discrimination. In its previous comments, the Committee had requested the Government to take measures to introduce in the legislation provisions that would explicitly prohibit all acts of anti-union discrimination covered by the Convention. The Committee notes with regret that while section 24 of the new Constitution as well as section 6 of the new Labour Act prohibit discrimination, none of them contains an explicit prohibition of discrimination against workers by reason of their trade union membership or participation in trade union activities. The Committee recalls, as it has done previously, that Article 1 of the Convention guarantees workers’ adequate protection against all acts of anti-union discrimination and that the existence of legal provisions prohibiting acts of discrimination is not enough if they are not accompanied by effective and rapid procedures to ensure their application in practice (see the 2012 General Survey on the fundamental Conventions, paragraph 190). The Committee is therefore compelled to repeat its request to the Government to take the necessary measures to introduce in the legislation: (i) an explicit prohibition of all prejudicial acts committed against workers by reason of their trade union membership or participation in trade union activities at the time of recruitment, during employment or at the time of dismissal (e.g. transfers, demotions, refusal of training, dismissals, etc.); and (ii) effective and sufficiently dissuasive sanctions in cases of violation of this prohibition. Reminding the persistence of allegations of acts of anti-union discrimination, the Committee requests the Government to provide information on any progress made thereon in its next report.

Article 2. Adequate protection against acts of interference. The Committee had previously requested the Government to indicate the measures taken or contemplated to introduce in the legislation a prohibition of acts of interference as well as rapid appeal procedures and dissuasive sanctions against such acts. The Committee notes that section 92(1) of the new Labour Act provides that employers and trade unions shall not perform or cause to perform any unfair labour practice and welcomes that section 92(2)(e) provides that, any act by the employer regarding intervention or cause to intervene in the activities relating to the formation, operation and administrative functions of trade unions, shall be deemed to be unfair labour practice. The Committee also notes that section 162 of the said Act, provides that where any person, employer, worker or officer acts in violation of the Act, the person affected by such act or the concerned trade union, with written consent of the affected person, may file a complaint to the competent authority having the power to decide within six months from the date of such act. Emphasizing the importance of ensuring effective protection against acts of interference and sufficiently dissuasive sanctions against such acts, the Committee requests the Government to provide further information on the sanctions applied in cases of acts of interference as well as on statistics on the number of complaints examined, the duration of the procedures and the type of penalties and compensation ordered.

Article 4. Promotion of collective bargaining. The Committee notes that section 116.1 of the new Labour Act provides that any enterprise employing ten or more workers shall have a collective bargaining committee that may submit collective claims or demands in writing to the employer on issues relating to the interest of workers. It notes that such a committee is comprised of: (a) a team of representatives appointed for negotiation on behalf of the elected authorized trade union of the enterprise; (b) where an election for the authorized trade union could not be held or the term of the elected authorized trade union has expired, a team of representatives nominated through a mutual agreement of all the unions in the enterprise; or (c) where an authorized trade union or a team of representatives could not be formed, a team of representatives supported with the signatures of more than 60 per cent of the workers working in the enterprise. The Committee recalls that direct bargaining between the enterprise and its employees with a view to avoiding sufficiently representative organizations, where they exist, may undermine the principle of the promotion of collective bargaining set out in the Convention. In addition, it has noted in practice that where there exists a representative trade union and it is active within the enterprise or branch of activity concerned, the authorization for other worker representatives to bargain collectively not only weakens the position of the trade union, but also undermines ILO rights and principles on collective bargaining. In order to fully evaluate the conformity of section 116.1 of the new Labour Act with the Convention, the Committee requests the Government to specify the conditions under which trade unions are authorized to bargain collectively and to provide information on the number of direct agreements concluded with non-unionized workers in comparison with the number of collective agreements signed with trade unions.

The Committee notes that the new Labour Act contains special provisions with respect to collective bargaining for trade union associations which are active in the tea estate, carpet sector, construction business, labour provider, transportation sector or any other group of manufacturers or service providers with similar or related activities. Section 123 of the Act stipulates that those trade union associations may, by forming a collective bargaining committee, submit collective bargaining claims or demands to the employers’ association of concerned group of industries. Section 123(3) provides that in those enterprises it is prohibited to submit collective claims or demands and entering into agreement pursuant to the abovementioned sections of the Chapter on Settlement of Collective Disputes of the Labour Act. The Committee also notes that, as stipulated in section 123(4), in cases concerning such enterprises, the Ministry may issue an order to submit collective claims or demands and negotiate within a specified time. The Committee recalls that under the terms of Article 4 of the Convention, collective bargaining must be free and voluntary and respect the principle of the autonomy of the parties. The Committee also recalls the need to ensure that collective bargaining is possible at all levels and that legislation that unilaterally imposes a level of bargaining or makes it compulsory for bargaining to take place at a specific level raises problems of compatibility with the Convention (see General Survey, op. cit., paragraphs 200 and 222). Highlighting that when collective bargaining takes place at different levels, coordination mechanisms can be put in place, the Committee requests the Government to take the necessary measures to amend section 123 of the new Labour Act so that the principle of the autonomy of the parties is respected and that collective bargaining is possible at any level whatsoever, including that of the establishment, the undertaking, the branch of activity, the industry or the regional or national levels.

Compulsory arbitration. The Committee recalls that its previous comments concerned provisions from the draft National Labour Commission Act, a draft that has not been adopted, as well as section 30 of the Trade Union Act, which gives special powers to the Government to restrict trade union activities considered against the economic development of the country. With respect to the latter, the Committee had requested the Government to indicate the measures taken so as to ensure that compulsory arbitration is not imposed at the initiative of the authorities where they consider that the country’s economic development so requires. The Committee observes that the new Labour Act contains provisions relating to compulsory arbitration. As provided for in section 117, the Collective Bargaining Committee shall hold consultations on the claims submitted and that, if an agreement is reached, it shall be binding for both parties. For its part, sections 118 and 119(1) provide that, if no agreement is reached and where the dispute is not resolved through mediation, it shall be settled through arbitration as follows: (i) if the parties agree to settle the dispute through arbitration; (ii) if it concerns an enterprise providing essential services; (iii) if it concerns an enterprise located inside the special economic zone; or (iv) if it concerns a situation where strike is prohibited because there is a state of emergency declared as per the Constitution. For its part, section 119(2) also provides that, where the Ministry has a ground to believe that a financial crisis may take place in the country as a result of ongoing or possible strike or lockout or believes that the dispute needs to be settled by arbitration, the Ministry, irrespective of the state of the collective dispute, may issue an order for the settlement of the dispute through arbitration. In this regard, the Committee recalls that, pursuant to the promotion of free and voluntary negotiation established by Article 4 of the Convention, compulsory arbitration to end a collective labour dispute is acceptable only if it is at the request of both parties involved in a dispute or in the case of disputes in the public service involving public servants engaged in the administration of the State (Article 6 of the Convention), in essential services in the strict sense of the term, namely those services whose interruption would endanger the life, personal safety or health of the whole or part of the population or in case of acute national crisis. The Committee regrets that the newly adopted Labour Act is not in line with this principle. It therefore once again requests the Government to take the necessary measures to ensure that, in accordance with the Convention, compulsory arbitration can only take place in the situations mentioned above.

Composition of arbitration bodies. The Committee notes that section 119(3) of the new Labour Act provides that, for all cases in which arbitration takes place, the Ministry of Labour and Employment may form an arbitration panel ensuring representations from workers, employers and the Government. The Committee also notes that section 120 provides that, for the purpose of settling collective disputes though mediation and arbitration, the Government may form an independent labour arbitration tribunal and that provisions in relation to such tribunal shall be prescribed. Recalling that arbitration bodies shall be fully independent, the Committee requests the Government to provide detailed information with respect to the composition of the said arbitration panel and tribunal and specifically to indicate the procedure undertaken to select the worker and employer representatives. It also requests the Government to clarify the difference between the arbitration panel (section 119(3)) and the arbitration tribunal (section 120).

Measures to promote collective bargaining. The Committee requests the Government to provide, in its next report, detailed information on the measures taken or contemplated to promote collective bargaining as well as on the impact of the recently adopted Labour Act on collective bargaining and agreements reached. In this respect, the Committee requests the Government to provide data on the number of collective agreements concluded, their scope and sectors concerned and the number of workers covered.