Observation (CEACR) - adopted 2018, published 108th ILC session (2019)

Right to Organise and Collective Bargaining Convention, 1949 (No. 98) - Brazil (Ratification: 1952)

The Committee notes the observations of: (i) the National Association of Labour Court Judges (ANAMATRA), received on 1 June 2018; (ii) the International Trade Union Confederation (ITUC), received on 1 September 2018; and (iii) the Single Confederation of Workers (CUT), communicated jointly with the ITUC and also received on 1 September 2018. The Committee notes that these observations, presented both in relation to the present Convention and the Collective Bargaining Convention, 1981 (No. 154), concern aspects of Act No. 13467 on collective bargaining.

The Committee also notes the joint observations of the International Organisation of Employers (IOE) and the National Confederation of Industry (CNI), received on 1 September 2018, which also relate to aspects of Act No. 13467 on collective bargaining examined by the Committee in its previous comment.

Follow-up to the conclusions of the Committee on the Application of Standards (International Labour Conference, 107th Session, May–June 2018)

The Committee notes the discussions in the Committee on the Application of Standards of the Conference (hereinafter, the Conference Committee) in June 2018 on the application of the Convention by Brazil. The Committee notes in particular that the Conference Committee, taking into account the fact that the Committee of Experts examined this case outside the regular reporting cycle, considering the Government’s oral submissions to the Conference Committee regarding the labour law reform and its compliance with its obligations under the Convention, and the discussion that followed, recommended the Government to: (i) provide information and analysis on the application of the principles of free and voluntary collective bargaining in the new labour law reform; and (ii) provide information on the tripartite consultations with the social partners regarding the labour law reform.

Article 4 of the Convention. Promotion of collective bargaining. Adoption of Act No. 13467. The Committee notes the Government’s indications concerning the early examination of the application of the Convention by the Committee in 2017. The Committee notes the Government’s view that: (i) the mandate of the Committee of Experts is to examine the application of ILO Conventions by member States in law and practice taking into account the different national situations and legal systems; (ii) in this respect, as mentioned during the discussion in the Conference Committee, the Government would have preferred the examination of the Convention to be undertaken during the regular reporting cycle so that sufficient time had elapsed to assess the application of the Act in practice. The Committee emphasizes in this regard that in 2017, after having received observations from both trade unions and employers’ organizations on the labour law reform process and noted the indications by the trade unions that the adoption of Act No. 13467 was likely to have a significant effect on the exercise of the fundamental right to collective bargaining, it considered it appropriate, in accordance with the criteria that it has established in this respect, to undertake an early examination of the application of the Convention by Brazil.

Relationship between collective bargaining and the law. In its previous comment, the Committee observed that, in accordance with Act No. 13467 adopted on 13 November 2017, new section 611-A of the Consolidation of Labour Laws (CLT) introduced the general principle that collective agreements and accords prevail over the legislation, and it is therefore possible through collective bargaining to derogate from the protective provisions of the legislation, with the sole limit of the constitutional rights referred to in section 611 B of the CLT. Considering that this principle is contrary to the objective of promoting free and voluntary collective bargaining, the Committee requested the Government to examine, following consultation with the social partners, the revision of sections 611-A and 611-B in order to bring them into conformity with Article 4 of the Convention.

In this respect, the Committee notes firstly the observations of the national and international trade unions concerning the scope and impact of the principle set out in section 611-A of the CLT. The Committee notes in particular that the trade unions allege, on the basis, among other sources, of a report of the Public Ministry of Labour of Brazil (Ministério Público do Trabalho) that the possibility of setting aside the protective provisions of the legislation through collective agreements and accords are particularly broad and significant as: (i) the list of subjects that can be set aside established in section 611-A of the CLT is described as non exhaustive; (ii) section 611-A explicitly provides that the absence of a compensatory measure for setting aside a legal protection is not a reason for annulling the clause in the agreement; (iii) the derogations made possible by section 611-A may be the product of enterprise accords which, under the terms of section 620 of the CLT, prevail over collective agreements covering a broader area; (iv) the subjects explicitly defined in section 611-A from which it is possible to derogate include the basic elements of worker protection, such as working time and rest periods, including the regulation of work and its duration in an unhealthy environment; (v) in violation of the basic principles of international labour law, sections 611-A and 611-B of the CLT provide that issues relating to hours of work and rest periods shall not be considered as being a matter of occupational safety and health; (vi) the possibility to set aside legal provisions governing the system of remuneration based on labour productivity may have dangerous consequences on hours of work and the health of workers; and (vii) compliance with the international labour Conventions ratified by Brazil is not indicated as constituting a limit to the possibilities of setting aside the provisions of the labour legislation through collective bargaining, which places in particular danger the application of the ILO Hours of Work (Industry) Convention, 1919 (No. 1), the Hours of Work (Commerce and Offices) Convention, 1930 (No. 30), and the Occupational Safety and Health Convention, 1981 (No. 155).

Secondly, the Committee notes the assertion by the trade unions that the possibility of setting aside the protective provisions of the legislation creates the conditions for downward competition between employers in relation to terms and conditions of work and employment, which will inhibit the practice of collective bargaining as an instrument for improving conditions of work. The Committee also notes that the report of the Public Ministry of Labour attached by the CUT indicates that, in the specific context of collective labour relations in Brazil, the principle set out in section 611-A of the CLT is likely to result in trade unions being subject to threats and pressure to accept derogations from the legislation and to authorize all trade unions, irrespective of their level of representativity, to negotiate below the level of legal protection, which could act as an incentive for corruption in collective labour relations. Finally, the Committee notes the assertion by the trade unions that the first statistics available confirm the fears expressed previously on the harmful effects of the establishment of the primacy of collective agreements and accords over the legislation. The Committee notes in this regard the various studies provided by the trade union organizations indicating that the number of collective agreements and accords concluded during the first half of 2018 is between 30 and 45 per cent lower than the first half of 2017.

The Committee also notes the observations of the employers’ organizations, which indicate that: (i) the principle of free and voluntary collective bargaining is fully guaranteed by the Constitution of Brazil, which also provides in article 7 for cases in which it is possible, through collective bargaining, for the flexible application of certain rights; (ii) the recognition of the primacy of collective bargaining over the legislation was necessary in a context characterized up to now by the excessive interventionism of the judicial authorities in accords concluded by the social partners; (iii) the primacy of bargaining over the law will therefore offer greater legal security to the social partners, which will allow the promotion of collective bargaining; (iv) the primacy of collective bargaining over the law is however far from being absolute, as section 611-B of the CLT establishes a long list of rights that cannot be set aside, such as normal hours of work in the day (eight hours) and the week (44 hours) and 50 per cent additional remuneration for overtime hours; and (v) collective bargaining remains entirely free and voluntary, as the unions can easily decide not to sign an accord containing derogations from the legislation.

Finally, the Committee notes the Government’s comments concerning, firstly, the content and scope of sections 611-A and 611-B of the CLT. The Government considers in this respect that: (i) the reform reinforces the role and value of collective bargaining by increasing its material scope of intervention, which is in full conformity with the objectives of ILO Conventions on this subject; (ii) the primacy recognized for collective agreements and accords over the law reinforces the legal security of collective bargaining, which is indispensable in light of the traditional interference of the judicial authorities of Brazil in this respect and makes it possible to render excessively detailed labour legislation more flexible; (iii) the reform also ensures the protection of the many rights set out in section 611-B of the CLT; (iv) the possibility to set aside individual legislative provisions does not mean that the collective agreement or accord is not more favourable to workers as a whole; (v) the view of the Supreme Federal Court, which in a recent ruling recognized the primacy of collective bargaining on condition that a “minimum floor of civilization” remains guaranteed by the law, is accordingly set out in the legislation; (vi) the recognition of the primacy of negotiation over the legislation is in accordance with the proposal made by a metallurgical union in 2011; and (vii) section 611-A does not in any event compel trade unions to conclude accords which set aside protective legal provisions, as the social partners can choose to continue to be governed, when that is in the interests of the parties, by the provisions of the legislation. The Committee also notes the Government’s views on the meaning and scope of the Convention in relation to collective bargaining. In this regard, the Committee notes the Government’s indication that: (i) nothing in Article 4 of the Convention establishes a link between the respective content of collective agreements and the legislation, as the sole purpose of the Convention is to promote collective bargaining; (ii) the same applies to Article 2 of Convention No. 154, which sets out the purpose of collective bargaining, with the sole purpose being once again to achieve its broader application; (iii) it is not legally well-founded to refer to the preparatory work of Convention No. 154 for the interpretation of Convention No. 98; and (iv) there is in any case no justification for referring to the preparatory work in the case of Article 4 of the Convention since, under the terms of Article 32 of the Vienna Convention on the Law of Treaties, recourse to the preparatory work is only a supplementary means of interpretation which may be used either to confirm the results of the general rules of interpretation, or when the latter leave the meaning ambiguous, obscure or manifestly unreasonable, which is not the case in the present instance.

The Committee takes due note of the information provided by the employers’ and workers’ organizations and by the Government concerning sections 611-A and 611-B of the CLT, and particularly on the links between these provisions and the obligations deriving from the Convention, the scope of the derogations to the legislation through collective bargaining made possible by section 611-A and on the limits established in this respect by section 611-B. The Committee notes that, based on this information: (i) the possibility of setting aside the protective provisions of the legislation through collective bargaining is not absolute, as section 611-B establishes a limitative list setting out 30 rights (including, for example, the minimum wage, normal hours of work per day (eight hours) and per week (44 hours) and the percentage of additional remuneration for overtime hours), based on the provisions of the Constitution of Brazil, which cannot be set aside through collective agreements or accords; (ii) the possibilities for derogation from the legislation opened up by section 611-A are however very extensive in so far as, on the one hand, the 14 points explicitly mentioned in this section cover numerous aspects of the employment relationship and, on the other hand, this list, in contrast with the wording of section 611-B, is solely indicative (“inter alia”). In the light of these elements, the Committee observes that, even though it is limited by a significant number of exceptions, the possibility to set aside protective legislative provisions through collective bargaining, established as a general principle by section 611-A of the CLT, remains particularly broad. Emphasizing that Article 4 of the Convention, in the same way as Conventions Nos 151 and 154, which have also been ratified by Brazil, have the general objective of promoting collective bargaining as a means of reaching agreement on more favourable terms and conditions of work than those envisaged in the legislation, the Committee recalls that it considers that the introduction of a general possibility of derogating through collective bargaining the protection established for workers in the legislation would in practice have a strong dissuasive effect on the exercise of the right to collective bargaining and could contribute to undermining its legitimacy in the long term. In the present case, the Committee considers that the extent of the derogations allowed by section 611-A of the CLT, which can be made by a sectoral collective agreement, as well as by an agreement at the company level, may affect the purpose and attractiveness of collective bargaining in the country, or at the very least to significantly modify its perception by the actors concerned and accordingly compromise its promotion and exercise. In this regard, the Committee notes with concern the data contained in the surveys provided by the trade union organizations concerning a significant decline in the number of collective agreements and accords concluded in the country since the entry into force of the reform of the legislation in November 2017. The Committee notes the Government’s indication in this respect that the trade unions are continuing to negotiate and sign collective agreements and accords.

In light of the above, the Committee recalls that while targeted legislative provisions covering specific aspects of conditions of work and providing, in a circumscribed and reasoned manner, for the possibility of their replacement by means of collective bargaining may be compatible with the Convention, a legal provision providing for a general possibility to derogate from labour legislation by means of collective bargaining would be contrary to the purpose of promoting free and voluntary collective bargaining established in Article 4 of the Convention. While emphasizing the importance of obtaining, in so far as possible, tripartite agreement on the basic rules of collective bargaining, the Committee requests therefore the Government to take the necessary measures, in consultation with the representative social partners, for the revision of sections 611-A and 611-B of the CLT so as to specify more precisely the situations in which clauses derogating from the legislation may be negotiated, as well as the scope of such clauses. The Committee requests the Government to provide information on any progress in this regard. It also requests the Government to communicate detailed information on the number of collective agreements and accords signed in the country, as well as on the number, content and scope of the clauses derogating from the legislation included in those accords and agreements.

Relationship between collective bargaining and individual contracts of employment. In its previous comments, the Committee noted that, under the terms of new section 444 of the CLT, workers who have a higher education diploma and receive a wage that is at least two times higher than the ceiling for benefits under the general social security scheme (currently around 11,000 Brazilian reals (BRL), or approximately US$3,390) will be able to derogate from the provisions of the legislation and collective agreements in their individual contracts of employment. The Committee recalled that legislative provisions which allow individual contracts of employment to contain clauses contrary to those contained in the applicable collective agreements (although it is always possible for individual contracts of employment to contain clauses that are more favourable to workers) are not compatible with the obligation to promote collective bargaining set out in Article 4 of the Convention. The Committee accordingly requested the Government to examine, after consulting the social partners, the revision of this provision so as to bring it into compliance with Article 4 of the Convention.

The Committee notes that, with reference to section 444 of the CLT, the Government indicates that: (i) this provision concerns a very small proportion of workers (around 2 per cent of the active population) who enjoy sufficient autonomy to defend their rights adequately through individual negotiation; (ii) the content of collective agreements is generally of little use to this category of employees as their situation is not generally covered by collective bargaining; (iii) the workers covered by section 444 of the CLT continue to benefit from the guarantee of the fundamental rights enumerated in section 611-B of the CLT; and (iv) nothing in Article 4 of the Convention prohibits individual contracts of employment from derogating from the content of collective labour agreements. The Committee recalls in this respect that the obligation to promote collective bargaining set out in Article 4 of the Convention requires that the individual negotiations of the terms of the contract of employment cannot derogate the collective agreements applicable to the employer, on the understanding that contracts of employment can always set out more favourable terms and conditions of work and employment. The Committee recalls that this principle is explicitly set out in the Collective Agreements Recommendation, 1951 (No. 91). While emphasizing that the collective bargaining machinery can take into account the specific needs and interests of different categories of workers who may, if they so wish, be represented by their own organizations, the Committee recalls that the present Convention is fully applicable to the workers covered by section 444 of the CLT in so far as, under the terms of Articles 5 and 6, only the armed forces and the police (Article 5) and public servants engaged in the administration of the State (Article 6) may be excluded from the scope of application of the Convention. The Committee therefore once again requests the Government, after consultation with the representative social partners concerned, to take the necessary measures to ensure the conformity of section 444 of the CLT with the Convention. The Committee requests the Government to provide information on any progress achieved in this respect.

Scope of application of the Convention. Autonomous and self-employed workers. In its previous comments, the Committee requested the Government to provide its comments on the allegations of the trade union organizations that the extension of the definition of self-employed workers as a result of new section 442 B of the CLT would have the effect of excluding a significant category of workers from the rights set out in the Convention. The Committee notes in this regard the Government’s indication that: (i) the Convention, even though it does not contain a definition of the concept of worker, is not by definition applicable to autonomous workers, as collective bargaining is unsuited to the occasional and independent nature of their activities; and (ii) section 442-B of the CLT has the sole aim of clarifying the criteria already existing in Brazilian legislation in relation to the definition of autonomous workers. The Committee recalls that Article 4 of the Convention establishes the principle of free and voluntary collective bargaining and the independence of the parties to negotiation for all workers and all employers covered by the Convention. With reference to self-employed workers, the Committee recalls that, in its 2012 General Survey on the fundamental Conventions, paragraph 209, it emphasized that the right to collective bargaining should also cover organizations representing self-employed workers. At the same time, the Committee is aware of the fact that the collective bargaining procedures applied in traditional labour relationships may not be adapted to the circumstances and specific conditions of the activities undertaken by self-employed workers. The Committee therefore invites the Government to hold consultations with all the parties concerned with a view to ensuring that all workers, including autonomous and self-employed workers, are authorized to participate in free and voluntary collective bargaining. Considering that such consultations are appropriate to enable the Government and the social partners concerned to identify the appropriate adaptations to be introduced into collective bargaining procedures to facilitate their application to autonomous and self-employed workers, the Committee requests the Government to provide information on the progress achieved in this regard.

Relationship between the various levels of collective bargaining. The Committee notes the indications of the ITUC relating to section 620 of the CLT, as amended by Act No. 13467. The Committee notes that, in accordance with this provision, the conditions established in collective labour accords (which are concluded under the Brazilian legislation at the level of one or more enterprises) always prevail over those contained in collective labour agreements (which are concluded under the Brazilian legislation at a broader level, such as a sector of activity or an occupation). The Committee observes that, as a result of this provision, more favourable clauses negotiated at the level of the sector of activity or occupation will in all cases be replaced by less protective clauses negotiated at the enterprise level. Recalling that, in accordance with Article 4 of the Convention, collective bargaining must be promoted at all levels and that, in accordance with the general principles set out in Paragraph 3(1) of Recommendation No. 91, collective agreements should bind the signatories thereto and those on whose behalf the agreement is concluded, the Committee requests the Government to: (i) indicate the manner in which respect for the commitments made by the social partners in the framework of agreements concluded at the level of the sector of activity or occupation are guaranteed; and (ii) provide information on the impact of section 620 of the CLT on recourse to the negotiation of collective agreements and collective accords, and on the overall coverage rate of collective bargaining in the country.

Consultations prior to the adoption of Act No. 13467. The Committee notes the detailed information provided in this regard by the Government and the social partners and observes the difference of views of, on the one hand, the trade union organizations and, on the other, employers’ organizations and the Government. While taking due note of the intense discussions that were held, with the participation of trade unions and employers’ organizations, in the two chambers of the Parliament, the Committee does not have information indicating that the Parliamentary discussion was preceded by a structured process of tripartite social dialogue intended to develop agreement on the content of the reform. In light of the necessity to ensure conformity of this reform with the Convention on various matters, the Committee invites the Government to engage in broad dialogue with the representative organizations of employers and workers in order to ensure that, in so far as possible, the reforms to be made to the legislation respecting collective bargaining are the subject of consensus with the social partners. Recalling that the Government can avail itself of ILO technical assistance, the Committee requests the Government to provide information on any developments in this respect.

2016 observation. In its previous comment, the Committee also requested the Government to provide detailed replies to the other points contained in its 2016 observation relating to: (i) adequate protection against anti-union discrimination; (ii) compulsory arbitration in the context of the requirement to promote free and voluntary collective bargaining; (iii) the right to collective bargaining in the public sector; and (iv) the subjection of collective agreements to financial and economic policy. The Committee once again requests the Government to reply to these comments, and in particular to indicate for each of them the possible impact of the 2017 reform of the labour legislation.

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