Interim Report - Report No 306, March 1997

Case No 1906 (Peru) - Complaint date: 20-SEP-96 - Closed

Allegations: Obstacles in the way of collective bargaining at industry level - Anti-union persecution

1. 541. The complaint in this case is contained in a communication from the World Federation of Trade Unions (WFTU) dated 20 September 1996. The WFTU subsequently presented additional information in a communication dated 2 December 1996.
2. 542. The Government sent its observations in a communication dated 23 January 1997.
3. 543. Peru has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), and the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainant's allegations

1. 544. In its communication dated 20 September 1996, the World Federation of Trade Unions (WFTU) objects to the decision of the Supreme Court which declared inapplicable Ministerial Resolution No. 053-93-TR laying down provisions to bring collective bargaining in the construction sector within the scope of the Industrial Relations Act and the regulations issued under it, section 4 of which provided that "under section 71 and section 45 of the Industrial Relations Act, collective bargaining shall take place at the branch level: Provided that the parties may, by common agreement, introduce changes in the level of bargaining, as well as geographical coverage, enterprises covered and other aspects determining and facilitating collective bargaining". Ministerial Resolution No. 053-93-TR was promulgated by virtue of the fact that the fourth transitional provision of the Decree issuing regulations under the Industrial Relations Act provides that: "the Ministry of Labour and Social Welfare, through a resolution issued by the authority responsible for the sector, shall issue relevant provisions to bring construction workers into line with the scope of Title III of the Act on collective bargaining". The complainant organization alleges that on the basis of the Court decision, the Ministry of Labour issued Resolution No. 051-96-TR repealing Ministerial Resolution No. 053-93-TR and providing that collective bargaining of construction workers shall be covered by the scope of the Industrial Relations Act (sections 44, 45 and 46), the regulations issued under it and the provisions of the present Ministerial Resolution. The trade union organization alleges that pursuant to this, the national list of demands presented by the Federation of Construction Workers of Peru (FTCCP) can only be applied at enterprise level and that branch-level bargaining is prevented. (The sections of the Industrial Relations Act referred to are as follows:
   • Section 44 - The collective agreement shall apply within the scope agreed upon by the parties, which may be:
     • (a) within the enterprise, when it applies to all workers of an enterprise, or workers in a category, section or specific establishment of the latter;
     • (b) a branch of activity, when it includes all workers of the same economic activity, or a specific part thereof;
     • (c) an occupation, when it applies to all workers who exercise the same occupation, trade or speciality in different enterprises.
   • Section 45 - If there is no prior collective agreement at any of the levels indicated in the previous section, the parties shall decide, by common agreement, the level at which the first agreement shall be negotiated. In the absence of an agreement, bargaining shall be held at the enterprise level.
   • If an agreement exists at any level, for the negotiation of another at a different level, to replace or supplement the said agreement, the agreement of the parties is an indispensable requirement and may not be established by administrative act or arbitration award.
   • The agreements at different levels concluded by the parties must be structured so as to define the subjects to be dealt with in each agreement. In the even of dispute the most favourable agreement shall be applied, after a full comparison of the texts.
   • Matters not dealt with in a higher level agreement may be negotiated at the enterprise level, and regulate or refer to the individual and exclusive working conditions of the enterprise.
   • Section 46 - For the conclusion of a collective agreement by branch of activity or occupation the trade union organization(s) must represent the majority of the enterprises and workers in the activity or respective occupation, at the local, regional or national level, and all the respective enterprises must be convened, whether directly or indirectly.)
2. 545. In its communication dated 2 December 1996, the WFTU alleges the persecution of trade union officers of the Federation of Construction Workers of Peru (FTCCP), specifically the fact that José Luis Risco Montalván, Secretary-General, Mario Huamán Rivera and Víctor Herrera Rubiños, organizational secretaries, were given a one-year suspended sentence for allegedly disturbing the peace in November 1991, in the course of a trade union struggle to restore the single national list of demands.

B. The Government's reply

1. 546. In its communication dated 23 January 1997, the Government states that section 44 of the Industrial Relations Act provides that a collective agreement shall apply within the scope agreed on by the parties, which may be within the enterprise (when it applies to all the workers in a category, section or specific establishment of the enterprise), branch of activity (when it covers all workers of the same economic activity or part thereof) and occupation (when it applies to all workers who exercise the same occupation, trade or speciality in different enterprises); it is therefore clear that provision is made for collective autonomy in deciding the level at which bargaining takes place. Pursuant to this, no party can oblige the other to bargain collectively at a given level. The Government states that in the case of the construction industry, the fourth transitional provision of Presidential Decree No. 011-92-TR provides that the Ministry of Labour and Social Welfare shall enact the relevant provisions, and that Ministerial Resolution No. 053-93-TR, in accordance with this mandate, enacted the provisions intended to facilitate the collective bargaining of construction workers within the framework of Legislative Decree No. 25593 - the Industrial Relations Act - and the regulations issued under it, approved by Presidential Decree No. 011-92-TR.
2. 547. The Government adds that the Peruvian Chamber of the Construction Industry (CAPECO), exercising one of the constitutional guarantees enshrined in article 200 of the Political Constitution of the State, brought a class action against Ministerial Resolution No. 053-93-TR on the grounds that it infringes various legislative and constitutional provisions by stipulating that collective bargaining in the construction sector should take place at the branch level, which specifically contradicts the third transitional and final provision of Legislative Decree No. 25593 (the Industrial Relations Act). The Government states that there has been no interference in the Judiciary Branch, since it is precisely one of the parties to bargaining that has brought the case before the courts in order that the judiciary may resolve the issue which, it alleges, not only affects it but runs counter to the relevant legislative and constitutional provisions. Consequently, the Ministry of Labour and Social Welfare has not intervened, nor has it exercised any influence on the judicial decision handed down in the last instance in accordance with due process, which demonstrates its respect for the autonomy and independence of the Judiciary Branch.
3. 548. The Government states that the first labour chamber of the Superior Court of Justice of Lima declared Ministerial Resolution No. 053-93-TR illegal and inapplicable based on the following considerations: (1) section 45 and the third transitional and final provision of Legislative Decree No. 25593 stipulate that in the absence of agreement between the parties, bargaining shall take place at the enterprise level. In order to bargain at a different level, the agreement of the parties is an indispensable requirement and may not be established by administrative act or arbitration award. This principle of respect for the will of the parties laid down by law is violated by the above-mentioned Ministerial Resolution, since it imposes branch-level bargaining on the parties, in violation of article 211, paragraph 11, of the Constitution of 1979, which was in force when this action was brought before the court (article 118, paragraph 8, of the Constitution of 1993); (2) the scope of section 71 of Legislative Decree No. 25593 respecting the regulation of bargaining which takes place through joint and multi-partite committees and other special cases cannot be invoked to justify the validity of the above-mentioned Ministerial Resolution since, pursuant to the fourth transitional and final provision of Presidential Decree No. 011-92-TR - issuing regulations under Legislative Decree No. 25593 - which provides that the Ministry of Labour and Social Welfare, through a resolution issued by the authority responsible for the sector, shall issue relevant provisions to bring construction workers into line with the scope of Legislative Decree No. 25593, at the time when this Ministerial Resolution was issued, bargaining in the construction sector did not take place through a tripartite commission, pursuant to the derogation laid down in the fourth transitional and final provision of Presidential Decree No. 011-92-TR and the provisions of Presidential Decree No. 018 of 4 December 1982, which provided for the establishment of a national commission for the construction industry. Consequently, collective bargaining should only take place at the level determined by the parties, whether it is the branch or the enterprise level, and therefore all that should have been done was to include construction workers within the scope of Title III of the Act, as stipulated in the same fourth transitional and final provision referred to above. Ministerial Resolution No. 053-93-TR, however, exceeded the scope of the Act, which is not the same as extending it, and therefore infringed constitutional principles relating to legislative hierarchy; (3) the Industrial Relations Act lays down a flexible framework for collective bargaining, and therefore there can be no doubt that the third transitional and final provision of Legislative Decree No. 25593 empowered the Peruvian Chamber of the Construction Industry to decide why the bargaining level should be the enterprise. Thus, Ministerial Resolution No. 053-93-TR exceeds the powers conferred on the Ministry of Labour and Social Welfare by Presidential Decree No. 011-92-TR, by laying down provisions concerning the bargaining level in the construction sector, thus infringing the parties' freedom to bargain.
4. 549. The Government adds that in the second and final instance, the Supreme Court, by decision handed down on 24 April 1996, upheld the decision of the Superior Court of Justice of Lima, which declared the class action lodged by the Peruvian Chamber of the Construction Industry (CAPECO) against the Ministry of Labour and Social Welfare to be well-founded, and consequently declared that Ministerial Resolution No. 053-92-TR was inapplicable to collective bargaining in the construction industry as of the day following its publication. The Supreme Court decision was based on the following: (1) the Public Prosecutor's decision states that the object of the action is to enforce a guarantee ("acción de garantía") is to declare illegal and inapplicable Ministerial Resolution No. 053-93-TR, which lays down provisions to bring collective bargaining in the construction sector within the scope of the Industrial Relations Act and the regulations issued under it. Section 45 of the above-mentioned Act provides that in the absence of agreement, collective bargaining shall take place at the enterprise level; in order to bargain at a different level, the agreement of the parties is an indispensable requirement, and cannot be established by administrative act or by arbitration award. Thus, section 4 of the Resolution, by providing that collective bargaining shall take place at the branch and not the enterprise level, violates paragraph 11 of article 211 of the Constitution of 1979, which was applicable at the time; (2) the above-mentioned Ministerial Resolution lays down general provisions to bring collective bargaining of construction workers into conformity with the Industrial Relations Act. These provisions of general scope should be subordinate to those of higher ranking legislation, which is the case of Legislative Decree No. 25593. Thus, section 45 of the above-mentioned Legislative Decree stipulates that if a bargaining level has not already been established from among those indicated in its section 44, the parties shall agree on a level, failing which bargaining shall take place at the enterprise level; it also states that if a given level has been agreed upon, in order to change it agreement must be reached between the parties; (3) moreover, the third transitional and final provision of Legislative Decree No. 25593 provided that the enterprises or occupations covered by collective bargaining at the branch level currently under way shall declare their willingness to continue bargaining at that level within 30 calendar days following the entry into force of the Legislative Decree; where no agreement is reached, bargaining shall always take place at the enterprise level; (4) Ministerial Resolution No. 053-93-TR imposes collective bargaining at the branch level and thus runs counter to Legislative Decree No. 25593 (the Industrial Relations Act), thus exceeding the limits laid down by the law and infringing the principle of legality. The court therefore upheld the decision declaring the class action to be well-founded.
5. 550. Lastly, the Government states that in order to implement the decision handed down by the judicial authorities, the Ministry of Labour and Social Welfare adopted Ministerial Resolution No. 051-96-TR, which is in conformity with national legislation and international standards ratified by Peru, by giving priority to agreement between the parties to determine the bargaining level, and only where no agreement is reached should bargaining take place at the enterprise level as stipulated by the general legislation, i.e. section 45 of the Industrial Relations Act.

C. The Committee's conclusions

1. 551. The Committee observes that in this case the complainant organization objects to the repeal of Ministerial Resolution No. 053-93-TR, which provided that bargaining in the construction sector would take place at the branch level, and the application in its place of the legislative provisions laid down by the Industrial Relations Act governing the determination of the level of collective bargaining.
2. 552. With regard to the allegations presented, the Committee notes that the Government states that: (i) section 44 of the Industrial Relations Act stipulates that the collective agreement shall apply within the scope agreed on by the parties, thus enshrining collective autonomy for deciding the bargaining level; (ii) Ministerial Resolution No. 053-93-TR laid down provisions intended to facilitate collective bargaining for construction workers within the framework of the Industrial Relations Act; (iii) the Peruvian Chamber of the Construction Industry (CAPECO) lodged a class action before the judicial authorities against Resolution No. 053-93-TR; (iv) the judicial authorities declared Ministerial Resolution No. 053-93-TR inapplicable, citing among grounds reasons the fact that "the Industrial Relations Act lays down a flexible framework for collective bargaining ..." and that "Ministerial Resolution No. 053-93-TR exceeds the powers conferred on the Ministry of Labour and Social Welfare by Presidential Decree No. 011-92-TR, by laying down provisions concerning the bargaining level in the construction sector, thus infringing the parties' freedom to bargain"; and (v) in order to implement the decision handed down by the judicial authorities, the Ministry of Labour and Social Welfare adopted Ministerial Resolution No. 051-96-TR which gives priority to agreement between the parties to determine the bargaining level, and only where no agreement is reached should bargaining take place at the enterprise level, as stipulated by the general legislation, i.e. in section 45 of the Industrial Relations Act.
3. 553. In this respect, the Committee observes that before this complaint was presented it already had occasion to examine allegations concerning obstacles in legislation and practice to branch-level collective bargaining, in which objections were raised against the provisions of the Industrial Relations Act governing the level of collective bargaining (see 302nd Report, Case No. 1845, paras. 514, 515 and 518(b)). The Committee would therefore refer to the conclusions it had reached on that occasion, in which it considered that "according to the principle of free and voluntary collective bargaining embodied in Article 4 of the Convention, the determination of the bargaining level is essentially a matter to be left to the discretion of the parties and that, consequently, the level of negotiation should not be imposed by law. The Committee considers that the requirement of a majority, not only of the number of workers, but also of enterprises, in order to conclude a collective agreement for a branch of activity or occupation set out in section 46 of the Industrial Relations Act of 1992 could give rise to problems in the application of Convention No. 98". As it did on that occasion, "the Committee requests the Government, in consultation with the social partners, to take measures to amend legislation so that workers' organizations and employers and their organizations may exercise freely and without obstacles the right to collective bargaining at all levels".
4. 554. As regards the allegation concerning persecution of trade union officers of the Federation of Civil Engineering Workers of Peru (FTCCP), specifically, the imposition by a judicial body of a suspended sentence of one year for José Luis Risco Montalván, Secretary-General, Mario Huamán Rivera and Victor Herrera Rubiños, organizational secretaries, for allegedly disturbing the peace in November 1991 in the course of a trade union struggle to restore the single national list of workers' demands, the Committee requests the Government to communicate its observations on the matter.

The Committee's recommendations

1. 555. In the light of its foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) Considering that the requirement of a majority, not only of the number of workers, but also of enterprises, in order to conclude a collective agreement for a branch of activity or occupation set out in section 46 of the Industrial Relations Act could give rise to problems in the application of Convention No. 98, the Committee requests the Government, in consultation with the social partners, to take measures to amend legislation so that workers' organizations and employers and their organizations may exercise freely and without obstacles to right to collective bargaining at all levels.
   • (b) The Committee requests the Government to communicate its observations concerning the alleged persecution of trade union officers of the Federation of Construction Workers of Peru (FTCCP), specifically, the fact that a judicial body imposed a one-year suspended sentence for José Luis Risco Montalván, Secretary-General, Mario Huamán Rivera and Victor Herrera Rubiños, organizational secretaries, for allegedly disturbing the peace in November 1991, in the course of a trade union struggle to restore the single national list of workers demands.