Report in which the committee requests to be kept informed of development - Report No 334, June 2004

Case No 2296 (Chile) - Complaint date: 18-JUL-03 - Closed

Allegations: Failure to deduct from wages of non-unionized employees sums corresponding to advantages derived from collective bargaining, dismissal of workers and non-compliance with the collective agreement by Distribuidora de Industrias Nacionales S.A.; dismissal of members of the works union, dismissal of a trade union official, harassment of workers, exertion of pressure on workers not to join the works’ union and recruitment of piece-workers and trainees by Hoteles Carrera-Hotel Araucano de Concepción; dismissal of union members by Multivending Ltda.; and dismissal of all the workers, including the union officials, by Andonaegui S.A.

1. 242. The National Confederation of Federations and Trade Unions of the Food, Tourism, Trade and Services Industry (COTIACH) presented its complaint in a communication dated 18 July 2003.
2. 243. The Government sent its observations in a communication dated 29 January 2004.
3. 244. Chile 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. 245. The National Confederation of Federations and Trade Unions of the Food, Tourism, Trade and Services Industry (COTIACH) alleges that, by Ordinary Act No. 2651, the National Labour Directorate fined Distribuidora de Industrias Nacionales S.A. for failure to pay over to the enterprise’s works’ union the deductions that it was supposed to make from the wages of non-unionized workers in the year 2000 (corresponding to advantages deriving from the collective agreement of 1999), and informed the union that it should apply to the courts for payment of the said deductions. The complainant adds that the enterprise has likewise failed to make similar deductions in respect of the new collective agreement concluded in 2001.
2. 246. The complainant further alleges that, since the collective bargaining process that ended with the signing on 26 December 2001 of a collective agreement covering 421 workers, a total of 102 workers affiliated to the union have been dismissed because of "pressing needs of the enterprise" (section 161 of the Labour Code) and that these workers were immediately replaced by part-time workers employed under individual contracts, as provided for under sections 40bis(a), 40bis(b), 40bis(c) and 40bis(d) of the Labour Code. Moreover, in November and December of 2001 and 2002, in a bid to wreck the trade union organization, the enterprise obliged the part-time workers to work full time, thereby inflicting damages both in financial terms and in terms of labour rights on the workers affiliated to the trade union and on those employed under part-time contracts. In disregard of the provisions of the 2001 collective agreement, the enterprise threatened the workers with dismissal if they did not sign an annex to their individual contracts, modifying the hours of work and treating Saturdays and Sundays as normal working days, thus putting an end to the bonus that had been negotiated in the collective agreement currently in force (eighth clause, letter (h)). The complainant adds that on 4 November 2002 the Labour Directorate was asked to issue a legal ruling on this matter and that on 28 May 2003 the Directorate ruled (ORD. 2035) that the enterprises had acted within the law.
3. 247. Regarding Hoteles Carrera-Hotel Araucano de Concepción, COTIACH alleges that since about 1996 that enterprise has systematically resorted to practices that have resulted in the trade union’s membership declining from 90 to a mere 24 workers.
4. 248. The complainant adds that on 4 April 1996 Mr. Manuel Castillo was dismissed because of "pressing needs of the enterprise" (section 161 of the Labour Code) even though he enjoyed trade union immunity as National Director of COTIACH; he was reinstated in his job on 9 April 1996. In July and August 1996 the enterprise began to harass workers by unilaterally changing their rest days, obliging them to work night shifts and adding new functions to their jobs that were not provided for under their individual contracts. In December 1996 the enterprises applied to the First Labour Tribunal of Concepción to waive the immunity of trade union official Miguel Arroyo on the grounds that he left the enterprise without prior permission. On 25 February 1997 the Tribunal ruled in favour of the union official.
5. 249. From April to September 1997 the enterprise once again started taking unilateral decisions, obliging workers to change their rest days and disregarding the terms of individual contracts relating to daily hours of work and functions. The same year the enterprise started recruiting workers on a piece-work basis; this measure, which was aimed specifically at unionized workers, resulted in the dismissal of workers with long-term contracts.
6. 250. During 1998 the trade union repeatedly called for financial inspections, which had led in the past to the enterprise being fined. The situation of the trade union suffered from the deliberate attempts of the enterprise to reduce the organization’s strength, with the complicity of the regional labour authority which refused to carry out financial inspections in response to complaints lodged by the trade union, despite the fact that the enterprise had previously been inspected and fined for such illegal activities and had not changed its conduct.
7. 251. As from 2002 the enterprise recruited trainees to replace union members that had been dismissed; this, together with the recruitment of piece-workers, has completely undermined the trade union organization.
8. 252. The complainant organization draws attention to the National Labour Directorate’s report No. 3581/0186 of 29 October 2002 in which it concluded that an employer can have on its premises an unlimited number of trainees without running foul of the law. Furthermore, the enterprise has infringed the principle of freedom of association by systematically exerting pressure on new workers not to join the trade union and on workers already with the organization to leave the union; for this it has employed a variety of methods, from the promise of wage increases to the offer of fictitious jobs within the enterprise.
9. 253. As regards Multivending Ltda., COTIACH states that early in 2002 the enterprise entered into collective bargaining with more than 30 members of the trade union but that because of the constant pressure and harassment by the employer there were only three members of the organization left at the beginning of the current year. When the organization applied to the National Labour Directorate to appeal against these anti-union practices, it declared in its ordinary ruling No. 2289 of 17 June 2003 that its investigations had not brought to light any anti-union practices.
10. 254. Finally, with regard to Andonaegui S.A., a works’ union was set up in the enterprise during the first half of 2001. After the conclusion of the collective bargaining process, the enterprise started harassing the workers (all of them women) to make them leave the company; the pressure tactics used ranged from cutting off the hot water in the showers to refusing to offer the workers even minimum working conditions. The enterprise dismissed all the workers, including the union officials, without any compensation whatsoever, and it was only this that induced the labour authority to refer the matter to the labour tribunals in accordance with the labour legislation.

B. The Government’s reply

• Distribuidora de Industrias Nacionales S.A.
  255. 255 The Government states that, in its regular report No. 2651 of 8 July 2003 based on the financial inspection report, the Labour Directorate observes that Distribuidora de Industrias Nacionales S.A. was required to make wage deductions for 2000 in respect of the advantages deriving from the 1999 collective agreement and pay them over to the trade union organization and that, since the deductions were not made, the only resort for the union officials was to apply to the courts for payment of the amounts that had not been collected. The Government adds that the enterprise was duly fined.
  256. 256 Regarding the collective agreement signed in 2001, which had been concluded as a result of a revision of the labour legislation and where, as with the collective agreement of 1999, the 75 per cent of the union dues corresponding to the advantages deriving from the agreement had again not been collected, the Government indicates that this is once again because the trade union organization has not lodged an appeal with the Labour Tribunal.
  257. 257 The Government encloses a communication from the enterprise dated 1 December 2003 indicating that the wage deductions were not made because in point of fact the advantages deriving from the agreement were not extended to the non-unionized workers; consequently, no fine was imposed in this connection by the administrative authority at any time nor was any appeal lodged with it.
  258. 258 As to the dismissal of workers, the Government states that the matter was reported to the Freedom of Association Office of the Labour Directorate. For its part, the enterprise states that the dismissals were part of the normal rotation of staff that are typical of this kind of company and affected both unionized and non-unionized workers; compensation was paid as stipulated in the relevant legislation. The recruitment of part-time workers was in response to the adaptation of the enterprise’s commercial activity to current market conditions. The enterprise categorically denies any intention to undermine the trade union organization.
  259. 259 Concerning the alleged non-compliance with the 2001 collective agreement, the Government notes that the Labour Directorate concluded that no such non-compliance could be invoked because, as the enterprise points out, a possibility exists under the legislation to modify working conditions by common agreement. The parties concerned thus decided by common agreement to modify the days and hours of work, including as they affected Saturdays and Sundays which were the days when sales were greatest and which therefore afforded the employees bigger commissions. Consequently, payment of the bonus provided for under the eighth clause, letter (h) of the collective agreement was waived and replaced by the new method of work that was more advantageous for the workers.
• Hoteles Carrera-Hotel Araucano de Concepción
  260. 260 With regard to the systematic dismissal of workers that has resulted in a decline in membership of the trade union from 90 to 24, the Government indicates that an investigation conducted by the Labour Directorate was unable to determine that the dismissals could be classified as anti-union practices inasmuch as they had taken place over a period of seven years and were due to pressing needs of the enterprise.
  261. 261 As to the dismissal of Mr. Castillo, National Director of the National Confederation of Federations and Trade Unions of the Food, Tourism, Trade and Services Industry (COTIACH), the Government states that this was a mistake, as the enterprise was unaware that Mr. Castillo was a union official and that, as the complainant organization recognizes, he was subsequently reinstated five days later.
  262. 262 With respect to the alleged harassment of the workers from 1996 onwards, infringement of their work contracts, request for a trade union official’s immunity to be lifted, dismissal of unionized workers and their replacement by piece-workers, recruitment of trainees and pressure on new workers not to join the trade union, the Government states that the Labour Directorate considered that the alleged facts did not constitute anti-union practices, inasmuch as the few cases that had been verified were not in any significant number.
• Multivending Ltda.
  263. 263 The Government states that the complainant organization has not produced sufficient evidence to conclude that the principle of freedom of association has been violated, since it merely indicates that its membership has declined. The Labour Directorate reached the same conclusion in its regular report No. 4731.
• Andonaegui S.A.
  264. 264 The Government states that the Labour Directorate was informed of the allegations regarding the dismissal of all the workers, including the trade union officials, after the conclusion of the collective bargaining process, and immediately referred the matter to the courts, whose decision is still pending.

C. The Committee’s conclusions

• Distribuidora de Industrias Nacionales S.A.
  265. 265 The Committee observes that the allegations refer to the failure of the enterprise to make the deductions from wages corresponding to advantages deriving from collective bargaining, as provided for by the legislation (a deduction amounting to 75 per cent of the union dues should have been made from the wages of the non-unionized workers because the coverage of the 1999 and 2001 collective agreements extended to them too); to the dismissal of 102 workers; and to non-compliance with the 2001 collective agreement. Regarding the failure to make the deductions from the wages of non-unionized workers, the Committee notes the Government’s statement that, after the facts had been established with respect to the 1999 collective agreement, the enterprise had been fined and that, if the complainant organization was unable to have the deductions made, its only recourse was to refer the matter to the labour courts. The Government also notes that the proper channel for obtaining payment of the deductions corresponding to the 2001 collective agreement is through the courts. The Committee observes, however, that the information provided by the Government does not match the communication of the enterprise, which the Government itself encloses with its reply. The enterprise states that the advantages deriving from the collective agreement were not in fact extended to non-unionized workers and that it was therefore not required to make the deductions and that it had never been fined or been the object of official complaints. The Committee calls on the Government to clarify these different versions and to send it the text of the decision of the Labour Inspectorate to the effect that the enterprise was fined. The Committee points out to the trade union of Distribuidora de Industrias Nacionales S.A. that it rests with the union to lodge an official complaint with the labour courts for payment of the deductions corresponding to the advantages deriving from the 1999 and 2001 collective agreements, if it so desires.
  266. 266 Concerning the alleged dismissal of 102 union members, the Committee notes the Government’s information that the matter was brought before the Freedom of Association Office of the Labour Directorate and that the enterprise denies that the action taken was anti-union in nature. The Committee calls on the Government to keep it informed of any decision taken by said Office in this matter.
  267. 267 Concerning the alleged non-compliance with the 2001 collective agreement, the Committee notes the Government’s information that the Labour Directorate concluded that there had not been such non-compliance. The Committee calls on the Government to inform it whether the trade union organization has lodged an official appeal against the said decision.
• Hoteles Carrera-Hotel Araucano de Concepción
  268. 268 The Committee observes that the allegations refer to the systematic dismissal of workers and the resulting decline in the membership of the works’ union from 90 to 24, the dismissal of Mr. Manuel Castillo, National Director of the National Confederation of Federations and Trade Unions of the Food, Tourism, Trade and Services Industry (COTIACH), the harassment of workers since 1996 and failure to respect their contracts, the dismissal of unionized workers and their replacement by piece-workers and trainees and the pressure on new workers not to join the trade union.
  269. 269 Concerning the alleged systematic dismissal of workers in the Hoteles Carrera-Hotel Araucano de Concepción enterprise, and the resulting decline in membership from 90 to 24, the Committee notes that, according to the Government, the Labour Directorate conducted an investigation and was unable to determine whether the dismissals could be classified as anti-union practices inasmuch as they had taken place over a period of seven years and were due to pressing needs of the enterprise.
  270. 270 Concerning the dismissal of the trade union official Mr. Manuel Castillo, the Committee observes that both the complainant organization and the Government state that the official was reinstated in his job five days after he was dismissed and that, according to the Government, his dismissal was a mistake (the enterprise being unaware of Mr. Castillo’s status as a union official). As to the dismissal of trade union official Mr. Miguel Arroyo, the complainant organization itself notes that the tribunal ruled in his favour.
  271. 271 Concerning the alleged harassment of the workers since 1996 and failure to respect their contracts, the dismissal of unionized workers and their replacement by piece-workers and trainees and the pressure on new workers not to join the trade union, the Committee notes that the Labour Directorate’s investigation indicated that the few cases that had been verified were not in a sufficiently significant number to be said to constitute a violation of the principle of freedom of association. That being so, the Committee will not pursue its examination of these allegations any further.
• Multivending Ltda.
  272. 272 The Committee observes that the allegations relate to the dismissal of a large number of unionized workers by the enterprise, with the result that the union only had three members left at the beginning of 2003. The Committee notes that, according to the Government, the complainant organization has not produced sufficient evidence to conclude that the principle of freedom of association has been violated, since it merely indicates that its membership has declined, and that the Labour Directorate reached the same conclusion in its regular report No. 4731. That being so, the Committee will not pursue its examination of these allegations any further.
• Andonaegui S.A.
  273. 273 The Committee observes that the allegations relate to the dismissal of all the workers of the enterprise, including the union officials, after the conclusion of the collective bargaining process. The Committee notes that, according to the Government, the matter was referred to the Labour Directorate which immediately lodged a complaint with the courts and that a decision is still pending. The Committee calls on the Government to keep it informed of the decision handed down by the judicial authority.

The Committee's recommendations

1. 274. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) Regarding the failure to deduct from wages of non-unionized employees sums corresponding to the advantages derived from the collective agreements of 1999 and 2001, the Committee points out to the trade union of the Empresa Distribuidora de Industrias Nacionales S.A. that it rests with the union to lodge an official complaint with the labour courts for payment of said deductions, if it so desires; the Committee also calls upon the Government to clarify the discrepancies between its own statements regarding deductions and the enterprise’s communication on this subject, and to send it a copy of the decision handed down by the Labour Inspectorate to the effect that the enterprise has been fined, which the enterprise denies.
   • (b) Regarding the alleged dismissal of 102 workers of Distribuidora de Industrias Nacionales S.A. that had been brought before the Freedom of Association Office of the Labour Directorate, the Committee calls on the Government to keep it informed of any decision taken by the said Office.
   • (c) Regarding the alleged dismissal of all the workers of Andonaegui S.A., including the union officials, after the conclusion of the collective bargaining process, the Committee calls on the Government to keep it informed of the decision handed down by the judicial authority.