Definitive Report - Report No 397, March 2022

Case No 3355 (Brazil) - Complaint date: 09-APR-19 - Closed

Allegations: The complainant organizations allege that provisional measure No. 873, approved in March 2019, will make the collection of trade union contributions extremely difficult and will have an impact on the financial management of the unions, compromising their sustainability

1. 95. The complaint is included in communications provided by the Workers’ Union of the Campinas Municipal Services and National Confederation of Public Municipal Employees (CSPM), dated 9 April and 19 July 2019.
2. 96. The Government sent its observations in a communication dated 12 August 2019.
3. 97. Brazil has not ratified the Freedom of Association and Protection of the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), but it has ratified the Right to Organise and Collective Bargaining Convention, 1949 (No. 98), the Labour Relations (Public Service) Convention, 1978 (No. 151), and the Collective Bargaining Convention, 1981 (No. 154).

A. The complainant organization’s allegations

1. 98. In its communications dated 9 April and 19 July 2019, the complainant organizations indicate that the President of the Republic approved, on 1 March 2019, Provisional Measure (PM) No. 873/2019, amending the Consolidation of Labour Laws (CLT) and directly impacting the unions’ funding model. The complainant organizations indicate that the PM drastically changes the way in which union contributions are raised, making it impossible to deduct trade union dues at source for workers, and allege that this has a significant impact on the organization and performance of the unions. The complainant organizations indicate that the PM amends sections 545, 578, 579, 579A and 852 of the CLT and allege that the main changes that will negatively affect the unions are the following:
   • the measure makes it impossible to directly deduct union contributions or dues at source for workers, determining that the collection of union dues will be made exclusively by means of a deposit slip or electronic equivalent, which the union must send to the employee at home or, where this is not possible, to the enterprise’s headquarters. The complainant organizations allege that the fact that direct deduction cannot be made from the worker’s wage will have a drastic effect on the system for collecting union dues, which will become more bureaucratic and significantly more onerous, since it will be necessary to issue receipts through the banking system, which represents a financial and time-consuming cost for the trade union organizations that may even exceed the income from the funds raised; and
   • the measure requires the prior, individual, express and written authorization of the worker for the collection of trade union contributions, determining that any clause to the contrary is null and void, even if authorized by collective bargaining.
2. 99. The complainant organizations allege that the new requirements imposed by the PM will make the collection of trade union contributions extremely difficult and will therefore directly affect trade unions in the very sensitive areas of their financial management and income generation, thus compromising their sustainability. They consider that the restriction proposed by the PM not only affects the freedom and collective autonomy of trade unions, but also directly affects the autonomy and power of individual self-determination of the worker, who is prevented from having the contribution he or she chose to make deducted from source. They also allege that the PM was issued without prior consultation with workers’ and employers’ representatives and that its content not only implies an anti-union position, but also constitutes an anti-democratic practice that restricts the collective rights and freedoms of trade unions, as well as the individual rights and freedoms of workers.
3. 100. The complainant organizations indicate that in November 2017, Act No. 13.467 (labour reform) was approved, amending several provisions of the CLT and incorporating new provisions into the legal text. The amended provisions include the above-mentioned sections 578 and 579. The complainant organizations indicate that prior to the labour reform, these sections provided that union contributions were mandatory and that, since the reform, union contributions have become optional and dependent on the worker’s authorization.
4. 101. The complainant organizations indicate that, although several unions throughout the country filed actions with the national courts and succeeded in suspending the effects of the PM, maintaining the possibility of deducting union dues at source for their members, most of the hearings have not reached the second instance and there is, therefore, no uniform jurisprudential interpretation concerning this issue. Lastly, the complainant organizations indicate that the provisional measures, such as the one in question, are issued as a matter of urgency and are discontinued if the text is not approved by National Congress within a period of 60 days, which may be extended. They indicate that the PM in question ceased to have effect on 28 June 2019 owing to the absence of legal regulation by the Congress, which is why it is no longer in force in the national legal system. The complainant organizations emphasize, however, that the discussion on the prohibition of deducting union contributions at source is ongoing at the national level.

B. The Government’s reply

1. 102. In its communication dated 12 August 2019, the Government sent its observations and indicated that, above all, the relevance and urgency of the adoption of the PM must be understood. The Government recalls that on 13 July 2017, Act No. 13.467 was adopted and indicates that, prior to the entry into force of this Act, union dues were mandatory by law. However, since it has been in force, union dues, formerly known as union taxes, became optional, depending on the prior and express consent of the worker. The Government explains that, although the logic enshrined in this Act, in terms of the need for the prior and express consent of the worker, was well defined in the provisions related to the union dues, there were still issues to be clarified. This included, for example, whether such consent could be given through a general assembly held in the trade union or in the scope of collective bargaining. The Government indicates that the Executive Branch decided to make this logic even more explicit through the PM in question.
2. 103. The Government cites paragraphs 18 and 19 of the explanatory statement that accompanies the PM, which indicate that: (i) while Act No. 13.467 was in force and the Federal Supreme Court had ruled on the constitutionality of the termination of the mandatory trade union tax, various strategies had been used without respecting the will of the legislator, such as collective bargaining and collective assemblies; and (ii) the prior authorization of the worker to which the Act refers must necessarily be individual, express and written, and the rule or clause establishing the mandatory payment of union dues is null and void, even where it is endorsed by collective bargaining, general assembly or any other means.
3. 104. The Government indicates that, according to data provided by the Labour Secretariat of the Ministry of the Economy, 1,954 collective instruments containing clauses related to the payment of union dues were deposited in 2018. The Government indicates that workers, both members and non-members of the unions, who had signed these collective agreements were subject to the rules contained in those clauses, even if they had not expressly agreed to any deduction to their remuneration. The Government considers that the countless workers who were to be affected by the deduction of union dues with which they did not agree needed to be protected immediately, and that there was, therefore, an urgent need for a PM to clarify these issues. The Government indicates that the provisions amended by the PM act as an important step in reflecting the will of the Legislative Branch by having approved Act No. 13.467/2017.
4. 105. The Government emphasizes that the collective clauses that establish contributions for a union body, in any capacity, making them mandatory for non-unionized workers, are against the right to freedom of association and to organize, guaranteed by the Constitution and, therefore, are null and void, as the contributions may be refunded, by the unions’ own means, potentially deducting the respective amounts. The Government considers that the discussion on the compatibility of the Constitution with the imposition of a mandatory contribution, through a collective contract or agreement, on workers who are not members of the respective union, is undeniably important from a legal, economic and social perspective, since it potentially raises the issue for all employees who are not members of unions, and also has an impact on the organization of the Brazilian trade union system and its funding modalities.
5. 106. The Government mentions that the Federal Supreme Court itself, in binding ruling No. 40, concluded that “the contribution referred to in article 8, paragraph IV, of the Federal Constitution, is applicable only to members of the respective trade union”, and that the Court determined that the establishment, by accord, collective agreement or standard, of mandatory contributions imposed on non-unionized workers is unconstitutional. The Court considers that the clause contained in an accord, collective agreement or standard establishing a contribution of any kind, to a union body, is a contravention of the freedom protected by the Constitution if non-unionized workers are required to pay it.
6. 107. The Government considers it necessary to distinguish between the trade union contribution provided for in the Constitution (article 8, final part of paragraph IV) and established by law (section 578 of the CLT) for professional categories and constituting a tax, with a mandatory logo, from the so-called assistance contribution, also known as the assistance fee. It indicates that the aim of the latter is to fund the union’s assistance activities, mainly in the course of collective bargaining, and does not constitute a tax. It also emphasizes that the bank receipt or electronic equivalent is a logical consequence as it serves to defend those who do not wish to contribute financially to trade union bodies and is therefore a measure that may safeguard the principle of freedom of association enshrined in article 8, paragraph V, of the Federal Constitution of 1988, which provides that no one is obliged to join or remain a member of a trade union.
7. 108. The Government considers that the provisions presented in the PM only provide greater legal certainty to social actors, especially by emphasizing the need to comply with the principle of freedom of association, without neglecting the necessary interplay with the content of Act No. 13.467/2017. The Government indicates, however, that the PM ceased to be in force as of 28 June 2019 because the term expired without it having been reviewed in the Legislative Branch.

C. The Committee’s conclusions

1. 109. The Committee notes that the present case concerns PM No. 873, approved by the President of the Republic on 1 March 2019, amending several sections of the CLT and providing that: (i) trade union contributions or fees cannot be deducted at source (the trade union must send a deposit slip to the worker who must pay the contribution at a bank); and (ii) the prior, individual, express and written authorization of the worker for the collection of the trade union dues and any clause setting out otherwise shall be null and void, even if a collective bargaining agreement exists.
2. 110. The Committee notes that the complainant organizations allege that: (i) the PM, issued without prior consultation with workers’ and employers’ representatives, will make the collection of union dues extremely difficult and will have an impact on the unions’ income generation, thus compromising their sustainability; and ( ii) although several unions filed actions and succeeded in suspending the effects of the PM, maintaining the possibility of deducting union dues at source for their members, most of the hearings have not reached the second instance.
3. 111. The Committee notes that in this respect the Government indicates that: (i) since the reform introduced by Act No. 13.467/2017, trade union contributions ceased to be mandatory and became optional; (ii) although the above Act refers to the need for the prior and express consent of the worker, questions remained to be clarified, such as whether such consent could be given through a general assembly held in the trade union or in the scope of collective bargaining; (iii) the Executive Branch decided to make this logic more explicit through the PM; (iv) 1,954 collective instruments containing clauses related to the payment of union dues were deposited in 2018 and workers were subject to the rules contained therein, even if they had not expressly agreed to any deduction to their remuneration, and there was an urgent need for a PM to clarify these issues; and (v) the bank receipt or electronic equivalent is a logical consequence as it serves to defend those who do not wish to contribute financially to trade unions.
4. 112. The Committee, while recalling that the withdrawal of the check-off facility, which could lead to financial difficulties for trade union organizations, is not conducive to the development of harmonious industrial relations and should therefore be avoided and that the issue of the deduction of trade union dues by employers and their transfer to trade unions is a matter which should be dealt with through collective bargaining between employers and all trade unions without legislative obstruction, [see Compilation of decisions and principles of the Freedom of Association Committee, sixth edition, 2018, paragraphs 690 and 701], takes due note that, as indicated by the complainant organizations and the Government, the PM ceased to be in force as of 28 June 2019 and therefore invites the Governing Body to decide that this case is closed and does not call for further examination.

The Committee’s recommendation

1. 113. In the light of its foregoing conclusions, the Committee invites the Governing Body to decide that this case does not call for further examination.