Report in which the committee requests to be kept informed of development - Report No 346, June 2007

Case No 2525 (Montenegro) - Complaint date: 23-OCT-06 - Closed

Allegation: The complainant organization alleges violation of the right to strike of workers of the Podgorica Aluminium Factory (KAP)

1219. The complaint is contained in communications dated 23 October and 22 November 2006 from the Confederation of Trade Unions of Montenegro (CTUM). By a communication dated 18 December 2006, the International Trade Union Confederation (ITUC) associated itself with the complaint.

1. 1220. The Government forwarded its observations in a communication dated 11 December 2006.
2. 1221. Montenegro has neither ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), nor the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainant’s allegations

1. 1222. In its communications dated 23 October and 22 November 2006, the Confederation of Trade Unions of Montenegro (CTUM) alleges violation of the right to strike in the Republic of Montenegro. The CTUM explains that the Podgorica Aluminium Factory (KAP), which employed over 3,000 workers and the production of which consisted of approximately 60 per cent of the total export and approximately 10 per cent of the Montenegrin GDP, was bought by the Russian company “Basic elements”. However, to the workers’ discontent, the contract of sale did not provide for the social redundancy programme. Therefore, the new owner was permitted to start dismissing employees as from 1 December 2006, 12 months after the sale of the enterprise. Due to the absence in the collective agreement of provisions on redundancy, the new owner was obliged to sign a new collective agreement with the KAP trade union. However, the management wilfully delayed the negotiation process and offered a humiliating social programme for future dismissals. Afraid that the new management could start dismissing workers before the collective agreement was signed, the union decided to conduct a strike in order to approach seriously the negotiation process and accelerate the conclusion of a new collective agreement. Having learned about the union’s intentions, the employer passed a resolution on minimum services without any consultations with the trade union. The resolution provided for a production of 20 per cent higher than the regular production capacity. Furthermore, the employer submitted a complaint to the Labour Inspection and asked its intervention to postpone the strike and to warn the strike committee of the KAP trade union that it was obliged to respect the employer’s resolution on the minimal labour service. The Labour Inspection agreed with the employer.
2. 1223. Concerned about possible legal penalties, the KAP trade union respected the Labour Inspection’s warrant, but requested the Inspection to intervene with respect to the employer’s unreasonable resolution requiring a 20 per cent production increase, which could not be viewed as a minimum service. However, the Labour Inspection failed to intervene and did not answer in writing to the union. Instead, the Labour Inspection considered that the strike committee should apply the employer’s resolution on minimum services.
3. 1224. During the strike, which lasted from 19 June to 13 August 2006, not once did the Labour Inspection intervene upon the notification of the strike committee, but it did intervene upon the request of the employer. By the time of the strike, the employer had engaged over 50 security guards, armed and uniformed, to intimidate the strikers. After the strike had ended, the employer submitted a claim against eight members of the strike committee, asking them to redress damages of 1,251,933.76 euros. In the complainant’s view, by submitting this claim, the employer wanted to ensure that the trade union officers and workers of the KAP would not conduct strikes in the future.
4. 1225. The complainant considers that the Labour Inspection and the Ministry of Labour and Social Protection, by siding with the employer, violated trade union rights. The complainant further considers that there is a necessity to change the provisions of the Law on Strike concerning minimum services.
5. B. The Government’s reply
6. 1226. In its communication dated 11 December 2006, the Government indicates that the Ministry of Labour and Social Protection, through the National Labour Inspection, monitors the application of the labour legislation, including the Law on Strike of 2003, as amended in 2005. This Law regulates the right to strike and is applicable to employees and employers.
7. 1227. With regard to the particulars of this case, the Government indicates the following. On 10 May 2005, the KAP trade union adopted decision No. 9 on the declaration of strike. The decision contained the claims of workers, the date and the hour of the beginning of the strike, its duration and location and provided for the composition of the strike committee. According to the decision, the strike was going to commence on 16 May 2006 at 7 a.m. The decision was communicated to the KAP executive director on 10 May 2006. On 15 May 2006, the Labour Inspection carried out an inspection and concluded that the trade union had violated section 11 of the Law on Strike, according to which, a notice of strike should be sent to the employer at least ten days prior to the beginning of the strike. Moreover, workers of the “Kovacnica”, the “Prerada” and the “FAK Kolasin” factories which were distinct legal entities from the KAP would go on strike illegally as they wrongfully sent their claims to the KAP management. Lastly, the strike notice should have provided for the minimum services to be ensured during the duration of the strike.
8. 1228. The inspection also revealed that the trade union representatives were invited by the employer for discussions with the view to resolving the contentious issues in respect of the conclusion of a collective agreement. However, the trade union representatives did not respond to this invitation.
9. 1229. On 23 May 2006, having learned of the union’s intention to begin the strike on 25 May, the KAP executive director requested the Labour Inspection to conduct an inspection of the KAP trade union. The Inspection concluded that the decision to strike was illegal as it was taken by the KAP trade union (in accordance with section 3 of the Law on Strike, the competent body to declare a strike within a branch or industry is the National Trade Union of Montenegro). Moreover, the strike, originally declared for 16 May 2006, was postponed until 25 May 2006 without a new decision to strike being taken, which is contrary to section 8(2) of the Law on Strike, which provides that “for each new strike, participants shall take a new decision to strike”.
10. 1230. On 15, 16, 18 and 19 May 2006, the KAP trade union requested the Labour Inspection to provide its opinion on the minimum services to be maintained during the strike on 25 May 2006. The National Labour Inspection informed the KAP trade union and its strike committee that it did not have the competence to provide opinions on the minimum services and suggested they address a tribunal. However, the Labour Inspection, having the competence to monitor the conformity of the acts of management with the legislation in force, proceeded with an inspection of application of section 10 and 10a of the Law on Strike, which provide:
11. Section 10
12. (1) Employees who conduct activities listed under section 9 of this Law may call a strike if the minimum of production process that ensures the safety of people and property, or is essential to life and work of citizens or work of other employer, i.e. legal entity or entrepreneur carrying out an economic or other activity or providing services.
13. (2) The minimum of production process in the sense of subsection (1) of this section is determined on the basis of the nature of the activity, the level of risk for people’s lives and health and other important circumstances for meeting the needs of citizens, employers and other subjects (time of the year, tourist season, school year, etc.).
14. (3) The minimum of production process and ways of ensuring it shall be determined by the enterprise’s founder or the employer, in accordance with the criteria of subsection (2).
15. (4) When defining the minimum of production process in terms of subsection (2), the enterprise’s founder or the employer shall request the opinion of the competent body of the competent trade union organization or of over a half of the employees with a view to conclude an agreement.
16. (5) The employees who have to work during the strike for the purposes of ensuring the minimum of production process shall be appointed by the manager or executive manager and the strike committee no later than five days prior to the beginning of the strike.
17. Section 10a
18. (1) If the minimum production process is not determined as provided for in section 10 of the Law, the minimum production process is then determined by the founder of the enterprise, i.e. its manager or executive director.
19. 1231. On 12 June 2006, the KAP trade union once again requested the Labour Inspection to examine the legality of the employer’s decision on minimum services. The inspection established that the KAP management had acted in conformity with the legislation when determining the minimum services. The employer sent decision No. 91-409 of 6 April 2006, accompanied by Act No. 92-622 of 6 April 2006, to the KAP trade union, requesting to proceed in conformity with section 10 of the Law on Strike. The KAP trade union forwarded its observation on this decision in its communications dated 18 April and 10 May 2006. Referring to section 10a of the Law on Strike, on 13 May 2006, the employer took a new decision on the minimum service and transmitted it to the strike committee.
20. 1232. On 13 June 2006, the KAP executive director addressed the Labour Inspection with a request to re-examine the legality of Decision No. 13 of 7 June 2006, issued by the KAP trade union calling a strike on 19 June 2006, as well as of the decision of the KAP strike committee not to comply with the employer’s decision on minimum services. The inspection reminded the trade union of the obligation to inform the competent authorities of the decision to go on strike. On 7 June 2006, the trade union transmitted its decision to strike to the Ministry of Interior, the Ministry of Economy and the secretariat for the enterprise development.
21. 1233. The inspection carried out on 16 June 2006 determined that decision No. 13 contained claims against legal entities other than the KAP. It further established that the strike committee determined the minimum services to be provided during the strike in Act No. 14 of 7 June 2006. In this respect, the inspection pointed out to the strike committee that only the employer had the competence to determine minimum services and recalled that a strike could be organized only in accordance with the provisions of the Law on Strike and that the strike could not begin prior to ensuring the minimum services determined by the competent body (sections 10 and 10a of the Law).
22. 1234. On 19 June 2006, the KAP executive director requested the Labour Inspection to confirm the legality of the note on minimum services provided by the trade union. The inspection carried out on the same day established that the trade union had issued the note on services to be provided in violation of the Law on Strike and that the strike had begun on 19 June 2006 without ensuring the minimum services as determined by the employer. The inspection established that the management had fixed the obligation to produce and to cast 110,000 tonnes of aluminium. According to the statements made by the members of the strike committee, while the indicated quantity was produced, it was not cast and delivered to the foundry. However, other services were provided. Furthermore, the members of the strike committee declared that the strikers would not respect the minimum services determined by the employer, as they considered that the workload was 20 per cent higher than the capacity of the installations. The strike committee also stated that certain workers were striking at their workplaces without causing inconvenience to those working.
23. 1235. On 20 June 2006, the Labour Inspection requested an opening of proceedings against the strike committee of the KAP trade union on the grounds of its refusal to collaborate with the employer to ensure the minimum services and thereby violating section 7 of the Law on Strike. During the proceedings, the members of the strike committee agreed with the findings of the Labour Inspection and declared that they were willingly infringing the Law on Strike but that they were forced to do so to protect their labour rights. By decision PP No. 83/2006-4 dated 22 September 2006, the members of the strike committee were found guilty of violation of the Law on Strike.
24. 1236. In the light of the above, the Labour Inspection considers that the KAP trade union and the strike committee have violated the procedure for declaration of the strike. It further considers that the rights of employees were not violated. However, the KAP employees were informed of their right to address a tribunal if they consider that their rights have been violated.

C. The Committee’s conclusions

1. 1237. The Committee notes that this case concerns alleged violations of the right to strike of workers of the KAP. The Committee notes that according to the complainant, the KAP trade union, faced with the employer’s refusal to negotiate in good faith on the issue of the redundancy system, declared a strike, which lasted from 19 June to 13 August 2006. During the strike, the trade union was obliged to provide minimum services as determined by the employer and equivalent to a 20 per cent production increase. The complainant alleges that the employer hired over 50 armed and uniformed security guards to intimidate the strikers. After the strike ended, the employer submitted a claim against eight members of the strike committee seeking to redress damages of 1,251,933.76 euros. The complainant further alleges that the Labour Inspection has failed to intervene in response to the union’s request on several occasions. Finally, the complainant considers that the provisions on minimum services of the Law on Strike are not in conformity with the principles of freedom of association.
2. 1238. The Committee notes that according to the Government, the strike was conducted in violation of the procedure provided for in the Law on Strike of 2003, as amended in 2005. In particular, the Government explains that, initially, the decision to begin a strike on 16 May 2006 was adopted on 10 May 2006 and notified to the employer on the same day. However, in accordance with section 11 of the Law on Strike, the decision to strike should be notified to the employer at least ten days prior to the beginning of the strike. Moreover, workers’ claims from the “Kovacnica”, the “Prerada” and the “FAK Kolasin” factories were wrongfully sent to the KAP management, which is a distinct legal entity from the above factories. Lastly, the notice of strike did not provide for the minimum services to be ensured during the strike. The KAP trade union then postponed the strike until 25 May 2006. This decision was also declared illegal by the Labour Inspection for the following reasons: (1) according to section 3 of the Law on Strike, the competent body to declare a strike within a branch or industry is the National Trade Union of Montenegro and not the enterprise trade union; and (2) according to section 8(2) of the same Law, a new decision to strike should have been taken. On 7 June 2006, the KAP trade union took a decision to begin a strike on 19 June. In this decision, the strike committee provided for the minimum services to be ensured during the strike. Nevertheless, the Labour Inspection considered that the strike was illegal because: (1) it was up to the employer to determine the minimum services to be provided during the strike; and (2) the union did not ensure the minimum services as determined by the employer. The Labour Inspection therefore requested an opening of proceedings against the strike committee of the KAP trade union on the grounds of refusal to collaborate with the employer. On 22 September 2006, the members of the strike committee were found guilty of violation of the Law on Strike.
3. 1239. The Committee notes that the complaint relates to the strike conducted from 19 June to 13 August 2006. In this respect, the complainant raises three sets of issues, namely: whether the minimum services imposed by the employer, the hiring of security guards to intimidate strikers and the penalty sought by the employer against the members of the strike committee are in conformity with the freedom of association principles.
4. 1240. With regard to the question of minimum services, the Committee understands from the text of section 10 and 10a, as set out in the Government’s reply, that the minimum services, where negotiation has failed, are to be determined by the employer. The Committee further notes that in this case, the KAP management required a 20 per cent production increase to be ensured during the strike. In the circumstances of this case, the Committee considers that the production of aluminium cannot be viewed as an essential public utility for which a minimum service can be imposed. The Committee requests the Government to amend the Law on Strike, in consultation with the social partners, so as to bring it into conformity with the principles of freedom of association and to keep it informed in this respect.
5. 1241. With regard to the complainant’s allegation that the enterprise hired armed security guards to intimidate strikers, the Committee notes with regret that the Government did not provide any observation in this respect. The Committee considers that it has insufficient information in this particular case to determine whether the use of security guards was contrary to the principles of freedom of association. The Committee considers that such acts by an enterprise can hinder the activities of a trade union and may constitute undue interference in the functioning of these organizations.
6. 1242. Finally, with regard to the damages claimed by the employer from the eight members of the strike committee, regretting that the Government has provided no information in reply to this allegation, the Committee recalls that no one should be penalized for carrying out a legitimate strike and that sanctions could be imposed only in respect of violations of strike prohibitions which are themselves in conformity with the principles of freedom of association. The Committee requests the Government and the complainant to provide further information on the employer’s claim and, specifically, on the authority to which the claim was submitted and on the outcome, if any, of such proceedings.

The Committee's recommendations

1. 1243. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee requests the Government to amend the Law on Strike, in consultation with the social partners, so as to bring it into conformity with the principles of freedom of association and to keep it informed in this respect.
   • (b) With regard to the damages claimed by the employer from the eight members of the strike committee, the Committee requests the Government and the complainants to provide further information on the employers’ claim and, specifically, on the authority to which the claim was submitted and on the outcome, if any, of such proceedings.