Interim Report - Report No 268, November 1989

Case No 1460 (Uruguay) - Complaint date: 21-JUN-88 - Closed

1. 535. The complaint is contained in a communication from the Inter-union Plenary of Workers-National Workers' Convention (PIT-CNT) dated 21 June 1988. The Government replied in a communication dated 19 May 1989 and two further communications dated 3 October 1989 (received in the ILO on 25 October 1989).
2. 536. Uruguay has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), 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's allegations

1. 537. In its communication dated 21 June 1988, the PIT-CNT states that it considers that the Uruguayan Government is systematically infringing ILO standards on protection of freedom of association (Convention No. 87) and the promotion of collective bargaining (Convention No. 98) in order to impose its economic policy as regards the wages of public and private employees. Already in 1987 the PIT-CNT wrote to the ILO denouncing the fact that the continuing operation of Act No. 13720 and Legislative Decree No. 14791 (the former enacted at a time when freedoms were suspended and the latter at the height of the dictatorship) was aimed at preventing the exercise of the right to strike and allowed wages to be fixed unilaterally by the Government without taking account of the opinion of the trade union organisations and employers' associations.
2. 538. As regards wage fixing in the private sector, the PIT-CNT refers to the wage councils. Set up in 1943 by Act No. 10449, these are autonomous bodies for tripartite consultation consisting in three government delegates and two each for employers and workers, operating at branch level, which adopt their decisions by a majority vote; this means that if the employers' and workers' representatives agree on a formula, it could be approved against the wishes of the government delegates. The entire system of collective labour relations in Uruguay was to a considerable extent structured around these bodies, with employers' and workers' organisations being constituted at branch level. This meant that these councils enjoyed a high level of prestige and their reconvening in 1985, after more than 18 years of inactivity, was generally welcomed. However, on the grounds that this reconvening did not comply strictly with legal formalities (since there had been no elections of representatives of occupational organisations, the latter being directly appointed by the most representative organisations), the Government decided to treat the decisions of the wage councils as draft resolutions requiring the approval of the Executive in the form of a decree. It based its reasoning on Legislative Decree No. 14791. As was pointed out in the report of the ILO mission on industrial relations in Uruguay carried out in 1986, this "means that the Government has the last word in wage bargaining, as it may refuse to sign the relevant decree if the decision submitted to it runs counter to its incomes policy". This is precisely what has been happening systematically in the last rounds of wage negotiations, to the point that it can be said that the wage councils no longer exist as such, as they have been drained of their substance by the Government and now exist only in form (see the above-mentioned report, page 109).
3. 539. The situation has worsened since the beginning of June 1988. Thus, the government representatives on the wage councils - convened for a new round starting on 1 June - confined themselves to stating that no wage agreement will be "confirmed" if it does not conform to the guide-lines laid down by the Government, irrespective of the will of the parties to collective bargaining (both employers and workers). The trade union movement cannot accept this attitude, which reflects a tendency to surrender to the guide-lines imposed by international financial organisations, whose chief priority is the repayment of the foreign debt, which in turn means purely and simply the loss of the purchasing power of wages.
4. 540. As regards collective agreements, the dearth of legislation on this subject which is characteristic of Uruguay makes it difficult to extend collective agreements as methods of wage fixing, since their compulsory effect throughout the branch is not ensured and there are no express provisions laying down the obligation for employers to negotiate. The traditional practice in Uruguay has been to submit bilaterally negotiated collective agreements for "confirmation" by the wage councils, turning them into decisions to make them generally applicable. The very structure and independence of these bodies favoured this practice, which thus allowed a unique development of independence of the parties even within a tripartite framework. This was clearly shown by the proliferation of collective agreements approved in this way in the 1960s. To a certain extent the expectations raised by the reopening of the wage councils in 1985 went in this direction, as was confirmed by the practice followed in many of the councils. The Government, however, in violation of its obligations as laid down in international standards, has taken it upon itself to obstruct, make difficult and even prevent the development of negotiation between the social partners. At first it brought pressure to bear through its delegates in the wage councils so that agreements between employers and workers would conform to its guide-lines; it then refused to retain in its decrees the wage clauses which did not follow these guide-lines (as the ILO mission was able to observe (see its report, page 112)); lastly, it went as far as to refuse to recognise the validity of the "medium- and long-term agreements" which had not been confirmed by the Executive. (Decrees Nos. 89/987 and 190/988 prescribe as a condition for the validity of wage clauses in agreements drawn up in the wage councils, that the latter "be confirmed by decree of the Executive Power".) The Minister of the Economy himself stated before the Committee on Labour Affairs of the Senate of the Republic that "obviously, the conditions laid down by the Executive Power shall be taken into account in deciding which agreements it is willing to confirm".
5. 541. The PIT-CNT adds that despite the express opposition of the trade union movement, section 1 of Legislative Decree No. 14791 adopted during the dictatorship is still in force. This section provides that "the Executive Power, jointly with the Ministry of the Economy and Finance and, where appropriate, with the Ministry of Labour and Social Security, may, if it considers it necessary and appropriate: ... (e) issue rules respecting wages and, in particular, establish occupational categories and regulate the remuneration of workers employed in the private sector". These extensive powers assigned to the Executive run counter to the system of wage councils and to collective bargaining. The use of such powers to supplant the will of the parties to labour relations constitutes a practice in violation of Conventions Nos. 87 and 98, as it restricts the freedom of association and independence of the parties which these Conventions guarantee. Despite this, the Uruguayan Government has thus made increasing use of Legislative Decree No. 14791, in blatant violation of international and national legislation, bringing unlawful pressure to bear on the entire system of collective labour relations and ensuring that it has the last word in fixing wages according to its own unilateral decisions of economic policy. A complete picture of this policy emerges from the decrees issued in February of the years 1986, 1987 and 1988 (94/986, 89/987 and 190/988) by which general wage increases were fixed directly by the Executive without convening the wage councils and without taking any account of the opinions of the sides of industry. The Minister of the Economy has made the following statement: "the Executive Power," said the highest exponent of the economic policy, "apart from refusing to confirm some agreements, has not taken any measures beyond this, except for the periodical decision, adopted out of considerations of timeliness and appropriateness, to fix remuneration by decree. Obviously, the Executive Power does not renounce this machinery."
6. 542. As regards collective bargaining in the public administration, the PIT-CNT alleges that the Uruguayan Government prevents the development of collective bargaining in the public administration, whether in the central administration or in autonomous bodies and decentralised services. This is a failure to comply with Convention No. 98, which allows only public servants engaged in the administration of the State to be excluded from its scope. The Government has attempted to conceal its violation of international standards in this field by agreeing to meet with trade union organisations of public servants both of the central administration and of the autonomous bodies and services. However, the methods used have merely confirmed its ignorance of such standards in addition to violating the Constitution of the Republic itself. Thus, at the level of the central administration, the Government was represented by the Ministry of Labour, the Ministry of the Economy and the Planning and Budget Office, which generally confined themselves to stating their own wage guide-lines. The complainant affirms categorically that this has nothing to do with genuine collective bargaining. Still worse is the situation in the autonomous bodies and decentralised services, because in this respect the Uruguayan Government has not only violated international standards but has also disregarded the independence of such bodies, enshrined in the Constitution, by refusing on several occasions to comply with the agreements reached between the directorates of these bodies and trade union organisations.
7. 543. Starting from the beginning of June 1988 the situation has worsened, if possible, in the public administration, both in the central administration and in the decentralised services and autonomous bodies. Thus, not even the sham negotiations which formerly took place have been opened. The situation is further exacerbated by the fact that 30 June 1988 was the deadline, the last time until 1990, for drawing up the budget accounts, since no adjustments may be made in 1989 which is an election year. This means that nearly half of all Uruguayan workers are not only prevented from participating in determining their wages, but also run the risk that for virtually two years they will have to submit to what the Government decides itself, in blatant violation of international Conventions and the most elementary democratic standards.
8. 544. The PIT-CNT alleges further that on 4 December 1987 the Puma Trading SA enterprise, which employs 130 workers, dismissed Messrs. Carlos Bàez and Williams Maciel, members of the executive committee of the Trade Union of Manual and Office Workers of Puma (SOEP) in violation of the provisions of Convention No. 98. In support of its allegation, the PIT-CNT highlights the following indications of the anti-union nature of the dismissals: (1) in 1987, labour-management relations became extremely difficult, being constantly obstructed by the employer; (2) the trade union leaders concerned were on the list of candidates for union elections which were to take place four days after the dismissal; (3) the dismissal cited "grounds of improving the service" as the persons involved "failed to meet the general requirements of the enterprise"; (4) hearings held in the Ministry of Labour established the impossibility of technically justifying the grounds cited by the employer; (5) the work records of the persons dismissed were excellent, since they had met all the requirements for admission to the enterprise and for employment in an occupational category involving considerable responsibility; (6) the enterprise did not give any explanation of the reason it had chosen this particular time to carry out the dismissal.
9. 545. The PIT-CNT emphasises that Uruguayan legislation still includes provisions which allow free dismissal of workers without giving reasons, on the sole condition that the statutory compensation is paid; the system of small fines imposed by the Ministry of Labour or the Labour Inspectorate (Decree No. 93 of 3 February 1968) in the event of acts of anti-union discrimination is absolutely inadequate, given the reality of the Uruguayan trade union movement. In this particular case, the National Labour Directorate was manifestly ineffective, with the result that the conflict was aggravated; the mediating officials refrained from acting and left it to the parties to settle the dispute.
10. 546. Lastly, the PIT-CNT alleges that in the second half of 1987, the "Sociedad Anónima Cristalerías del Uruguay", which employs about 650 workers, introduced changes in its machinery. According to the trade union, this new machinery involved technological changes, which meant that the collective agreement in force since 1973 and registered with the Ministry of Labour and which had been concluded between the parties and governed this important subject, should have been applied. The trade union organisation demanded that the Ministry ensure compliance with this agreement. Industrial action was also taken, consisting, inter alia, in the exercise of the right to strike with partial and total stoppages in the enterprise. At a time when both parties were willing to negotiate, the trade union decided to cease one of the stoppages, and the enterprise took this opportunity of accusing Messrs. Carlos Chemino (treasurer of the Workers' Union of Cristalerías del Uruguay) and Aníbal López (shop steward) of flagrant misconduct, and dismissed them in September 1987 in violation of Convention No. 98. The dismissal of these leaders was clearly motivated by anti-union aims, on the pretext of misconduct which had not been committed, as the Ministry of Labour concluded in its decision. Nevertheless, the enterprise compelled them, under threat of losing their jobs and unemployment benefit, to accept the dismissal compensation provided for by national legislation, in an attempt to "clear themselves" of the violation of trade union rights. According to the PIT-CNT, this paying off, which occurred seven months after the termination of the employment relationship, does not cancel out the act of discrimination, and the investigation should continue.
11. 547. The PIT-CNT highlights the inadequate legal procedure for processing complaints of violation of trade union rights. The procedure lasted several months and failed to consider and note other means of proof which would have provided knowledge on the basis of which a decision could have been made. The PIT-CNT also stresses the responsibility of the Ministry for the deplorable and biased intervention of the official who came to carry out an inspection at the factory; he not only ignored the trade union leaders but met only with representatives of the enterprise, which resulted in a one-sided and badly written report on which the National Labour Directorate based its opinion. Both oral and written complaints were accordingly brought against this conduct of the case before the National Labour Directorate and the National Inspector, with a request for an immediate investigation. The case has still not been dealt with by the above-mentioned agency. Moreover, the collective agreement provides for intervention by the Ministry of Labour in order to settle disputes, which was not done. In addition, the delay in replying to the appeal for annulment and to the appeal lodged with the higher instance against the Directorate's decision (although the time-limit for considering it is 300 days) constitutes a real denial of justice. The complainant considers that this delay clearly runs counter to Article 3 of ILO Convention No. 98 as it fails to establish reasonably efficient machinery to regulate the practical aspects of implementing this standard.

B. The Government's reply

1. 548. In its communication dated 19 May 1989, the Government states that it considers that the PIT-CNT's complaint fails to meet the required receivability criteria since it is mainly confined to making sweeping judgements without referring to specific cases or points. Based on vague general information, the allegations merely extrapolate certain of the comments - also couched in general terms - made by the ILO mission on industrial relations in Uruguay carried out in 1986, whose observations cannot be substituted for the ILO's supervisory procedures. However, bearing in mind the fact that the ultimate purpose of the procedure set up by the ILO is to promote respect of trade union rights in law and in practice and, as it has shown in the past, the Government is aware of the importance for this purpose of sending precise replies to the allegations so that they may be examined objectively, the Government will refrain in this case from formally raising the question of receivability, to which it none the less draws attention.
2. 549. First, the Government stresses the exceptional situation prevailing in the wage-fixing system in Uruguay as a result of the legislative vacuum in the wake of the de facto regime which was in power from 1973 to 1985. This exceptional situation made it necessary to introduce machinery and institutions combining previously-enacted legislative provisions and informal factors, which were successively applied in a process which is still under way. This process is transitional in nature and is guided by the State, with the objective of replacing administrative wage fixing which was typical during the dictatorship with free and responsible collective bargaining, mindful of the general interest.
3. 550. In order to encourage this process, the Government chose to give priority to promoting tripartism through the wage councils which had been instituted by an Act of 1943 which for 25 years until 1968 had constituted the framework for collective bargaining in the absence of other specific legal provisions. However, the possibility of objections to the validity of wage council decisions, which might be based either on doubts as to the effect of the 1943 Act itself or on the practical impossibility of exhausting the legal procedure for the appointment of wage council members, made it necessary for the sake of legal soundness for wage council decisions to be elaborated and brought into effect by administrative decision under the provisions of Act No. 13720 and Legislative Decree No. 14791. These texts had vested in the Government powers to regulate through administrative channels the remuneration of workers in the private sector. After more than a decade in which collective bargaining had completely disappeared, the reopening of the wage councils proved to be a suitable instrument for promoting bargaining. Thus, they both constituted an adequate framework for negotiation, and, in the absence of legal provisions laying down the obligation to negotiate, their periodical sessions meant that such a duty existed in practice.
4. 551. Aware of these effects, the Government, as the body responsible for convening the councils, regulated their frequency so that the parties would develop bargaining to cover increasingly longer periods without prejudice to the concurrent establishment of periodical procedures for the adjustment and increase of wages. The process under way may be divided into three clearly differentiated stages: in the first stage, running from mid-1985 to mid-1986, the wage councils were convened on a general basis every four months and their agreements also covered a four-month period; in the second stage, from mid-1986 to mid-1988, in addition to the general four-month meetings, the conclusion of "long-term agreements" in certain branches of activity was promoted; these agreements, negotiated bilaterally while the systems of four-monthly adjustment were maintained, covered longer periods of up to two years; lastly, in the third stage, which has lasted since mid-1988, the wage councils were convened in every case to conclude bilaterally negotiated "long-term agreements" covering at least 20 months and always subject to four-monthly adjustment. Since the wage councils had been set up, the Government had only availed itself in exceptional cases of the legal provisions empowering it to fix wages administratively except in so far as putting its decisions to effect.
5. 552. Throughout this process, the participation of state representatives in the bargaining bodies was aimed at safeguarding the general interest, which took the form of what was termed "guide-lines" intended to guide the parties with respect to the anti-inflationary policy in order to allow effective growth of "real wages" which had declined during the de facto regime. For this purpose, the "guide-lines" were linked directly and exclusively to the pricing policy, and limited the extent to which wage increases could be passed on to prices, without restricting the parties' freedom to negotiate higher amounts of remuneration, as long as they were absorbed by the enterprises, whether by cutting profits, improving productivity or any other means of reducing costs. The "guide-lines" respected freedom of bargaining to such an extent that, as may be seen from the studies supplied, the wage increases granted as from 1985 consistently exceeded the limits for the mark-up of prices. This ultimately resulted in a considerable increase in real wages which, despite an annual inflation rate fluctuating around 70 per cent, are now some 30 per cent higher than in March 1985.
6. 553. Today, just four years after the restoration of democratic institutions in Uruguay, and as a result of the process outlined above, over 80 per cent of workers employed in the private sector are covered by "long-term agreements". These agreements are essentially negotiated bilaterally and regulate wages for periods of 20 months on average, including both mechanisms for maintaining purchasing power which are applied at four-monthly intervals with regular corrections, and machinery ensuring real growth, also applied periodically and linked to increases in various production variables.
7. 554. With this in mind, in order to complete the transition, the Government promoted consultation with the social partners at the level of the most representative national organisations of employers and workers. These consultations concerned the adoption of a framework agreement which, in accordance with the recommendations of the ILO mission, would in future draw up the principles for definitively setting up a system upon which a consensus has been reached, based on free and responsible collective bargaining, and mindful of the general interest (the Government encloses the report of the Tripartite Seminar on Industrial Relations). The Government's decision in this respect ultimately led to ratification of the Collective Bargaining Convention, 1981 (No. 154) approved by Act No. 16039 promulgated on 8 May 1989.
8. 555. As regards the functioning of the wage councils, whose reconvening has been welcomed, the complainant takes exception to the fact that their decisions come into force through administrative channels, although it acknowledges that this was made necessary by the impossibility in practice of exhausting the legal procedure for designating employers' and workers' representatives who, instead of being elected, were directly appointed by the most representative organisations. This sweeping grievance claims to be founded exclusively on two brief and incomplete quotations of the extensive observations drawn up by the ILO mission on industrial relations in Uruguay carried out in 1986, whose mandate expressly excluded the examination of the application of international labour standards. The first of these quotations, which refers to a de jure opinion expressed in passing in hypothetical terms, to the effect that this procedure "also means that the Government has the last word in wage bargaining, as it may refuse to sign the relevant decree if the decision submitted to it runs counter to its incomes policy", is an incomplete rendering of the mission's appreciation of the system.
9. 556. In fact, as may be seen on the same page 112 referred to by the complainant, in the preceding paragraph the mission stated that "the fixing of wages by decree is not only possible but is probably indispensable from the point of view of form. This is so because the wage councils are composed of delegates who are appointed and not elected (as required by the Act of 1943) and it could thus be alleged that there is a defect of form as regards the manner in which they are set up; such an allegation could lead to the validity of councils' decisions being questioned with some chance of success. Such validity could even be questioned on the basis of the possible repeal of the Act of 1943, the effect of which, as has been pointed out, is currently disputed. The fixing of wages by decree is thus aimed at obviating these difficulties, as it is based on the Act of 1978, which is still in force". In the following paragraph the mission pointed out that it "has not heard of any cases in which the Government refused to confirm a decision of the wage councils", thus ruling out the possibility of a real occurrence of the de jure hypothesis outlined in the deliberately truncated quotation. The second quotation, which cannot be found on the page indicated, claims that the Government systematically refused to confirm decisions of the wage councils, which were thus drained of their substance. The vagueness of this assertion, which is utterly devoid of any factual basis and is belied by the observations of the mission, compels the Government to categorically reject it.
10. 557. As regards the collective agreements, the accusation contained in the complaint on this point is once again sweepingly vague and confined to the view, also devoid of any sound basis, that "the Government, in violation of its obligations as laid down by international standards, has taken it upon itself to obstruct, make difficult and even prevent the development of negotiation between the social partners". According to the allegation, this took the form of three types of behaviour which are described in sweeping terms: bringing pressure to bear through its delegates in the wage councils so that agreements between employers and workers would conform to government guide-lines; refusing to retain in its decrees wage clauses which did not follow these guide-lines and refusing to recognise the validity of the medium- and long-term agreements which had not been confirmed.
11. 558. As for the so-called "guide-lines", the Government again points out that, as may be seen in detail in the attached studies and as described by the report of the ILO mission already referred to, these guide-lines did not restrict freedom of negotiating wages, but the carrying over to prices of the wage increases granted in the wage councils. In other words, to quote the ILO misson: "that is, increases of any kind could be granted in the wage councils; however, wage increases could affect prices only within the limits set by the Government. Amounts in excess of this had to be absorbed by the enterprises" (page 115). Moreover, an analysis of the results of the various rounds of negotiation in the wage councils shows that, on average, the wage increases granted exceeded in every case the limits set by the guide-lines for the mark-up of prices, which meant that there was a real growth in wages. (On this point, the Government refers to one of its enclosures entitled "Consultation and wage policies in Uruguay, 1985-88".)
12. 559. Furthermore, the alleged refusal to retain certain wage clauses in the administrative validation procedure is expressly and exclusively based on the observations allegedly made by the ILO mission as described on page 112 of its report. Again, this report was quoted incompletely, omitting the mission's statement on page 81 that "following the mission, we heard that this agreement had finally been confirmed (as had others in the same situation)".
13. 560. Moreover, it is a well-known fact that in Uruguay collective agreements have full force and are applied between the parties even without confirmation (or, strictly speaking, extension), which only gives them universal force of law over and above their applicability ipso jure between the parties. This is what was observed by the mission, so often misquoted by the complainant, which stated on this point that "once most of the restrictions of the previous period had disappeared, the practice of collective bargaining in the private sector re-emerged with considerable momentum as from March 1985. All of the persons who spoke with the mission pointed out that a considerable number of collective agreements of the most varied kinds were negotiated daily, although the exact figures are not known as comparatively few are registered with the labour authorities and even fewer are published. With the exception of a few cases (agreements on dismissals, agreements of the Construction League, agreements submitted to the wage councils for their confirmation), collective agreements are normally considered as private instruments which therefore do not call for compliance with any prescribed form or with any publication requirements as a condition for their validity" (pages 77-78). Lastly, the failure to mention any specific cases in support of the sweeping accusations on this point prevents the Government from going further. Nevertheless, it repeats once again that the recent legislative approval of the ILO Collective Bargaining Convention (No. 154) is conclusive proof of its firm decision to promote, as it has done, free and responsible collective bargaining, mindful of the general interest.
14. 561. The allegation concerning administrative wage fixing, once again couched in sweeping terms and referring to the alleged "increasing use by the Uruguayan Government of Legislative Decree No. 14791, in blatant violation of international and national legislation, bringing unlawful pressure to bear on the entire system of collective labour relations and ensuring that it has the last word in fixing wages according to its own unilateral decisions of economic policy" for once gives a concrete example, that of the decrees enacted in February of the years 1986, 1987 and 1988, by which wage increase percentages were fixed directly by the Executive. In this respect, it should first be pointed out that the three cases referred to, in which unilateral administrative wage fixing was resorted to, were temporary exceptions to the system of principle which, as has been pointed out, gave priority to tripartite bargaining in wage councils, and later developed into bilateral negotiation. Moreover, it must be emphasised that in all three cases this unilateral administrative wage fixing was expressly confined to the four-monthly adjustment due in the month of February and automatically expired after four months with the negotiation of subsequent adjustments.
15. 562. As regards the first Decree in particular (February 1986), a detailed picture of the actual circumstances leading to its adoption emerges both from the study attached to the reply as Annex I and from the report of the ILO mission (bottom of page 115). These circumstances, consisting in a risk of renewed inflation, without a doubt met the criterion laid down by the Committee on Freedom of Association for recognising the legitimacy of temporary restrictions on free collective bargaining. In this respect, it should be borne in mind that in addition to being applied as exceptional measures and being limited to what was necessary (that is, to refraining from convening the wage councils for the wage adjustment due the following four-month period), these measures were in fact accompanied by adequate guarantees to protect the workers' standard of living, to the extent that the increases thus administratively decreed exceeded the inflation rate for the period covered by the administrative wage fixing.
16. 563. Moreover, as regards the decrees enacted in February of 1987 and 1988, it should also be borne in mind that in both cases they only covered sectors of activity which were not covered by previously negotiated "long-term agreements", the effect and validity of which were expressly respected. Furthermore, as regards minimum wages, they provided for the possibility of the parties negotiating higher increases bilaterally, in which case only the carry over to prices was restricted.
17. 564. As regards the alleged practices in violation of international Conventions on collective bargaining in the public administration, on this point the complaint again bases itself on an incomplete quotation from the ILO mission report. Thus, while it is true that the mission pointed out that the general development of collective bargaining in the public sector is fairly limited and precarious, it also stated that "there is general and informal wage bargaining every four months for the purpose of adjusting the salaries of public employees, taking into account the increase in the cost of living" and that "as we were told in trade union circles, the main problem encountered in negotiations is not so much the absence or lack of mandate of the other partner, but rather state budget constraints". What is more, the mission pointed out that "there are also negotiations with the Ministries to discuss specific problems" and that "de facto agreements are concluded in some municipalities and autonomous bodies". Over and above the observations of the mission, the Government must make it clear that in the absence of a normative framework, the development of collective bargaining in this sector was impeded by the fact that no agreement had been reached as regards the levels at which this bargaining was to take place. There had been repeated cases of demands or terms already negotiated or being negotiated at the sectoral level simultaneously being put forward at the level of various subdivisions, thus distorting the scope of negotiation and its results. In view of this, it must be borne in mind that the Government has adopted measures to promote and encourage the development and institutionalisation of collective bargaining in the public sector. For this purpose, on 24 April 1985, the Executive submitted an explanatory note together with a bill to the Legislature, proposing that regulations be issued under and effect be given to article 65 of the Constitution, according to which "the law may permit commissions representing the staff concerned to be set up in autonomous bodies in order to collaborate with the directors in the execution of the rules laid down by the by-laws, the study of the budget, the organisation of services, the regulation of work and the application of disciplinary measures". Similarly, on 28 January 1987, the Executive, taking up the favourable opinion given by the tripartite group set up by the Ministry of Labour and Social Security to advise it in matters relating to international labour standards, also submitted an explanatory note and a bill to the Legislature proposing and advising ratification, inter alia, of the Labour Relations (Public Service) Convention, 1978 (No. 151) ultimately approved by Act No. 16039 promulgated on 8 May 1989 and therefore due to enter into effect imminently.
18. 565. For the rest, the allegations of the PIT-CNT are confined to even more sweeping accusations which, being false, are utterly devoid of any factual basis.
19. 566. As regards the present situation, the Government must point out that, contrary to the prophecies of the complainant, today 308,000 workers in the private sector, representing 83.47 per cent of the entire workforce, are covered by 127 collective agreements or long-term wage agreements, essentially negotiated bilaterally since June 1988, which regulate their remuneration for average periods of 20 months, and providing, by means of four-monthly adjustments, both machinery to maintain value and mechanisms to ensure real growth. This has caused dispute levels to drop to their lowest point. The Government concludes these comments, of necessity general, by repeating that it is aware that it is not the duty of the Committee on Freedom of Association to draw conclusions on the trade union situation in the country on the basis of generalisations. Nevertheless, in view of the fact that the complainant appears to have attempted to do so, it cannot fail to refer in the last instance to the objective opinion of at least one of the members of the ILO mission so often quoted in the complaint, who, in addition to stating that "freedom of association, the independence of the parties and respect of the right to strike are still the basic tenets of labour relations in Uruguay", concluded that "since then (1985) the evolution of labour relations has been very sound in many respects: there has been a return to dialogue between the public authorities, the employers and the trade unions; basic trade union rights have been restored; public employees who had been dismissed under the military regime for trade union or political reasons have been reinstated in their jobs; wages have recovered a sizeable part of their lost purchasing power; and labour disputes, after a period in which they reached worrying proportions, have started to diminish".
20. 567. In two communications dated 3 October 1989, the Government sends detailed observations denying the allegations of dismissals in the Puma Trading SA and Cristalerías del Uruguay companies.

C. The Committee's conclusions

1. 568. The Committee observes that this complaint refers to certain restrictions on collective bargaining, both in the public and in the private sectors, as well as several dismissals for anti-union reasons. Generally speaking, the Committee observes that, as regards collective bargaining, there has been a positive evolution in many respects since the complaint was presented in June 1988. Specifically, the Committee notes with interest that Uruguay has recently ratified the Labour Relations (Public Service) Convention, 1978 (No. 151) and the Collective Bargaining Convention, 1981 (No. 154), the Government initiatives taken with a view to concluding a tripartite framework agreement on the collective bargaining system, and lastly, the proliferation of "long-term collective agreements" which currently cover over 83 per cent of wage earners.
2. 569. As regards the allegations relating to the right to collective bargaining of public servants and employees, the Committee hopes that the requirements of Convention No. 98, as well as those of the recently ratified Conventions, Nos. 151 and 154, will be fully complied with. In this respect, the Committee would refer to the comments made on Uruguay's application of Convention No. 98 by the Committee of Experts on the Application of Conventions and Recommendations at its March 1989 meeting. The experts stressed that "organisations of public servants who are employed in autonomous bodies and decentralised services (state enterprises) should enjoy the right to collective bargaining, since the Convention only permits the exclusion from its scope of public servants engaged in the administration of the State". Therefore, in view of the fact that the contents of the April 1985 bill referred to by the Government do not meet the requirements of Convention No. 98, the Committee fully endorses the request of the Committee of Experts that the Government take measures to include in the legislation explicit recognition of the right to conclude collective agreements of organisations of public servants in autonomous bodies and decentralised services (state enterprises) who are not engaged in the administration of the State.
3. 570. As regards the allegations concerning wage fixing through administrative channels, specifically under the terms of Decrees Nos. 94/986, 89/987 and 190/988 (the legal basis of which was section 1 of Act No. 14791), the Committee notes that, according to the Government, these were exceptional measures taken in the context of the struggle against inflation, and were limited in duration to a four-month period. The Committee also observes that these provisions referred to minimum wages and not to the possibility of limiting wage increases in collective agreements. As was expressly stated by the Government, these provisions did not prevent the parties from bilaterally negotiating wage increases in excess of those provided for in the decrees of 1987 and 1988, but merely limited the extent to which they were passed on to prices. In these circumstances, the Committee concludes that there has not been a violation of the right of trade union organisations to bargain collectively with a view to the regulation of terms and conditions of employment by means of collective agreements as provided in Article 4 of Convention No. 98. It will be for the Committee of Experts to comment on the application of the Conventions concerning minimum wages ratified by Uruguay.
4. 571. As regards the alleged statements of government representatives according to which no wage agreement will be "confirmed", unless it respects the government guide-lines, the Committee would point out that in the Uruguayan system, what is referred to as "confirmation" of a collective agreement is, strictly speaking, an "extension" of its application to all workers employed in the branch of activity concerned even if they do not belong to the signatory trade union organisations or the enterprises to which the collective agreement applies. However, in the event of refusal to extend a collective agreement, nothing appears to prevent the workers who are not covered by the agreement to conclude other collective agreements through their trade union organisations. The Committee therefore considers that these allegations do not call for further examination.
5. 572. Lastly, the Committee decides to examine at its next meeting the allegations of anti-union dismissals in the Puma Trading SA and Cristalerías del Uruguay companies, since the Government's observations on this matter were received only a few days before the Committee's present meeting.

The Committee's recommendations

1. 573. In the light of its foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee notes with interest that there has been a positive evolution in many respects as regards collective bargaining, and specifically notes the ratification by Uruguay of Conventions Nos. 151 and 154.
   • (b) The Committee, as the Committee of Experts has already done, requests the Government to take measures to include in the legislation explicit recognition of the right to conclude collective agreements of organisations of public servants of autonomous bodies and decentralised services (state enterprises) who are not engaged in the administration of the State.
   • (c) Lastly, the Committee decides to examine at its next meeting the allegations concerning anti-union dismissals in the Puma Trading SA and Cristalerías del Uruguay companies.