Interim Report - Report No 355, November 2009

Case No 2639 (Peru) - Complaint date: 15-APR-08 - Closed

Allegation: Interference by the budgetary authorities in the collective bargaining process of state enterprises

1. 977. The complaint is contained in a communication by the Federation of Peruvian Light and Power Workers (FTLFP) of 15 April 2008. This organization provided new allegations in a communication of 3 November 2008. The Government sent its observations in communications of 24 February and 30 October 2009.
2. 978. 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. 979. In its communication of 15 April 2008, the FTLFP explains that the collective bargaining carried out by its affiliated unions with the relevant state-owned electricity companies is covered by the private employment regime and is therefore governed by the principle of party autonomy, which means that negotiations should not be subject to any state interference or intervention. Nevertheless, since its establishment in 1999, the National Fund for Financing State Enterprise Activity (FONAFE) has been actively participating in collective bargaining processes. The complainant organization alleges in particular that FONAFE Circular No. 009 of 27 February 2008 sets out the following guidelines for collective bargaining in enterprises under the auspices of FONAFE:
2. – The board of directors or manager of the enterprise shall, by means of the relevant document, appoint the members of the bargaining committee representing the enterprise (hereinafter “the bargaining committee”) and set out the parameters on the basis of which negotiations must be carried out with union representatives. These parameters must be in strict compliance with the legal framework currently in force.
3. – Prior to the conclusion of a collective agreement, the bargaining committee shall present a report to the general management of the enterprise, containing an assessment of the proposals made by the union representatives. On the basis of this report, the bargaining committee is required to make a final bargaining proposal, which has to be approved by the board of directors or general management of the enterprise for presentation to union representatives.
4. – Once the collective bargaining process has been completed, the bargaining committee shall, in a written report, substantiate and demonstrate compliance with the parameters that were set for it. This report must be submitted to the social body that set the parameters, which in turn must send a copy to FONAFE for reference.
5. 980. Furthermore, as part of its regulatory activities, FONAFE has set up mechanisms that restrict the right of workers to bargain freely and also affect the content of negotiations. Thus, “remuneration policies” were introduced by Executive Board Decision No. 0022003/DE-FONAFE of 22 January 2003, to be applied in some state-owned enterprises, including with regard to members of the FTLFP-affiliated unions in the enterprises EGESUR SA, EGEMSA, the South-West Electricity Company S.A. (Seal SA), Electro Sur Este SAA and Electrosur SA. Likewise, Executive Board Decisions
6. Nos 047-2002/DE-FONAFE (with regard to the electricity-generating enterprise San Gabán SA) and 033-2002/DE-FONAFE (with regard to the enterprises EGECEN SA, Electro Ucayali SA, EGASA and Electro Oriente SA) were adopted and implemented for the same purpose. The regulations in question, which are supported by non-existent powers conferred upon FONAFE, set pay ceilings which are applicable to the workers from the enterprises that are involved in collective bargaining.
7. 981. For example, the complainant organization adds that, in the negotiation and adoption of the collective agreements for the 2007 period, signed by its first-level trade unions and the enterprises Seal SA and Electro Sur SA, the pay ceilings imposed by FONAFE in Executive Board Decision No. 002-2003/DE-FONAFE were applied, which was a violation of the principle of collective autonomy, especially as these collective agreements provide that, for the period in question, the workers involved in this process would not receive a pay increase.
8. 982. In its communication of 3 November 2008, the complainant organization refers to the case of the enterprise Electro Sur Medio SAA, in which two of its affiliated first-level trade unions, the Single Trade Union of Workers and Employees of Electro Sur Medio SAA of Ica and Nazca and Allied Workers and the Single Trade Union of Workers of Electricidad Regional Sur Medio SAA of Pisco and Chincha, operate and, at the time of the complaint, were negotiating the lists of demands for 2007–08 and 2008–09. The complainant organization states that, on 22 September 2008, the abovementioned unions contacted the enterprise Electro Sur Medio SAA and the Ica regional labour authorities about the decision by members to launch an indefinite nationwide strike, which had been agreed upon largely because of the refusal by the enterprise Electro Sur Medio SAA to settle the list of demands for the period 2007–08.
9. 983. The unions reached the decision to go on strike on 9 and 11 September, at assemblies convened and organized by the relevant executive bodies, in accordance with the rules set out in the internal trade union regulations and in the Collective Labour Relations Act.
10. 984. Nevertheless, in a letter of 23 September 2008, in response to the notice of strike action and in blatant disregard of the right to collective freedom of association, the enterprise Electro Sur Medio SAA stated: “We have taken note of your undated communication giving notice of your decision, demonstrated in your minutes of the assemblies of 9 and 11 September, to launch an indefinite general strike from midnight on 7 October 2008. During those assemblies, it would seem that your partners made their decision without knowing that, on 18 September, you were called to our head office in order to be informed that we have accepted your latest comprehensive pay proposal, with the sole proviso being agreement to the union leave limits set by law, which is reasonable in the light of this enterprise’s needs in an extremely difficult economic situation”.
11. 985. The employer thus accuses the two unions of having held the general assemblies of workers and of having taken strike action without informing union members of the employer’s proposal to increase pay so long as union officials involved in collective bargaining relinquished their ability to take union leave at any time, as is provided for in the collective agreements concluded with the enterprise; this clearly is a blatant interference in union activities, protection against which is provided under Article 2 of ILO Convention No. 98. This interference is especially grave considering, as is explained below, that the enterprise Electro Sur Medio SAA is seeking to make the relinquishment of union officials’ right to take union leave at any time a condition for settling the list of demands relating to the collective bargaining for 2007–08, which is also a violation of freedom of association.
12. 986. The complainant organization notes that, in another paragraph of the letter, the legal representative of Electro Sur Medio SAA stated that: “Apparently, taking into account that the agreements were reached at the assemblies of 9 and 11 September 2008, the workers were unaware that your latest demand for a pay rise was accepted by the enterprise on 18 September. We therefore find it particularly remarkable that the workers want to launch an indefinite strike simply for a trade union benefit that will in no way affect free trade union activity, which we have always respected”.
13. 987. It should be noted in this regard that, pursuant to section 32 of the Collective Labour Relations Act No. 25593, which is now part of the amended consolidated text approved by Supreme Decree No. 010-2003-TR, union leave over and above the legal minimum of 30 calendar days, as provided for by the Act, must be respected, unless, in this specific case, the parties in the enterprise Electro Sur Medio SAA agree to amend the collective agreement that gave rise to the trade union leave entitlements. In this regard, the refusal of the abovementioned unions to negotiate and surrender the right to take union leave at any time, which is recognized under the collective agreements reached with Electro Sur Medio SAA, cannot be used as a condition for and an obstacle to settling the list of demands for the period 2007–08. In particular, Electro Sur Medio SAA proposes, as a condition for increasing pay and settling the dispute, that recognized entitlements to take union leave at any time should be limited to the number of leave days set by law (30 days per year), as referenced in section 32 of the Collective Labour Relations Act.
14. B. The Government’s reply
15. 988. In its communication of 24 February 2009, the Government sends the observations of FONAFE with regard to the complaint, which are set out below.
16. 989. First, the complainant federation indicates that state enterprises are covered by the private labour regime and should therefore not be subject to state intervention, even though these enterprises are predominantly funded by the State. In this regard, with respect to state enterprises, the State is not only the provider of capital, but it is also the employer, and as such enjoys the same privileges as any private employer that conducts its bargaining strategies autonomously and freely, within the limitations imposed by the general rules of public policy and the budget for its enterprise. It should also be noted that, in accordance with section 1 of the amended consolidated text of the Collective Labour Relations Act (Decree No. 010-2003-TR), the employees of state bodies and enterprises that fall within the scope of the State’s business activities are subject to that body of regulations in so far as its provisions are not contrary to specific regulations that restrict the benefits the State provides for its employees. In other words, a supplementary application of the body of regulations in question is proposed for when there are specific regulations that could restrict some of the rights it contains, such as the right to collective bargaining. Accordingly, the National Fund for Financing State Enterprise Activity Act (Act No. 27170, hereinafter “the FONAFE Act”) and the General National Budget System Act (Act No. 28411) are special regulations that restrict the application of the amended consolidated text of the Collective Labour Relations Act, as is explained below.
17. 990. Second, the Federation indicates that FONAFE’s role is limited to aspects of state enterprise management, i.e. the approval of the budget and administrative regulations. It further indicates that FONAFE does not have the right to intervene in and oversee collective bargaining procedures in each of the enterprises. In this regard, FONAFE is not merely a holder of shares representing the social capital of state-owned enterprises; quite the contrary, FONAFE carries out a positive and key role with regard to the overall budgetary procedures of state enterprises by exercising the regulatory and supervisory powers recognized by law. In this respect, FONAFE regulates state enterprise activity, in accordance with Chapter VI of the General Act on the National Budget System (No. 28411), which states in its paragraph 52.4:
18. 52.4. The National Fund for Financing State Enterprise Activity (FONAFE) and the enterprises under its auspices plan and formulate their budgets on the basis of the guidelines issued by this body, within the framework of rules of stability that are based on the macroeconomic projections set out in section 4 of the Fiscal Responsibility and Transparency Act.
19. 991. Furthermore, the General Act on the National Budget System (No. 28411), in its fourth transitional provision, states:
20. 3. The National Fund for Financing State Enterprise Activity (FONAFE), by agreement of its board, approves the pay scales of FONAFE and its enterprises and sets regulations, within its sphere of competence, on wages and other employment benefits. In enterprises that are involved in state enterprise activity but are not under the auspices of FONAFE, any decisions to increase, adjust or grant new benefits are approved by Supreme Decree endorsed by the Minister of Economy and Finance.
21. 992. In this regard, in accordance with section 1 of the amended consolidated text of the Collective Labour Relations Act and the laws mentioned in this text, FONAFE may and must intervene in the remuneration policy of its enterprises by setting limits and guidelines, and there should be no perception that this intervention is interference in collective bargaining.
22. 993. Additionally, it is important to note that the legally established responsibilities of FONAFE, as the governing body of the state enterprises’ budgetary policy, and specifically the regulatory powers conferred upon it with regard to the scales and composition of pay received by the employees of these enterprises, do not reflect an intention to secure a more advantageous position for the State, but are based on the principle of state enterprise activity as follows:
23. Unlike individuals who operate state or industrial enterprises for profit-making purposes, the Government does so in order to meet a public need. The resources that an enterprise has at its disposal are not owned by that enterprise; they are simply resources that form part of the assets “earmarked” for compliance with the objectives of the body, which is state-owned.
24. 994. Accordingly, FONAFE’s actions through its guidelines set a pay ceiling (which is aligned with the budget for state enterprises), with a view to achieving the country’s development through a policy of austerity. Their aim is to establish reasonable salaries that are commensurate with the activity performed by each worker and clearly in line with the enterprise’s budget (which is aligned with the operative and strategic plans of the enterprise).
25. 995. Third, the complainant federation states that FONAFE’s action constitutes illegal interference in collective bargaining as follows:
26. – In the membership of the employer’s negotiating committee. This is incorrect, because each of the enterprises appoints its own staff and it is with the enterprise and not with FONAFE that workers have their employment relationship. FONAFE is not involved in the appointment process.
27. – In the development of economic proposals, though FONAFE is not involved in the creation of these proposals. Given that FONAFE is only involved in approving the overall budget of the enterprises under its auspices, and in accordance with the guidelines that have been issued for this purpose (available at www.fonafe.gob.pe), the aim of this approval process is to draw up a budget with parameters that are comprehensive or general in scope, placing general pay ceilings on the total expenditure that can be disbursed by the enterprise, including on staff overheads (total staff costs), with each enterprise having full authority and discretion with regard to the implementation of its internal wage policy and labour contingency payments. Thus, it is the responsibility of the enterprise to set its own specific budget for each worker, covering any labour contingencies that it may have to address.
28. 996. In this regard, FONAFE, as the governing body of state enterprise activity, acts in accordance with its legally conferred powers to provide non-specific but supplementary guidelines for negotiations between the enterprises under its auspices and their workers. As previously mentioned, the State, like any employer, is entitled to give instructions to the members of the bargaining committees on the enterprise side, through FONAFE guidelines or communications, on the parameters they should use to shape collective bargaining proposals. These proposals should also respect the budgetary constraints provided by law.
29. 997. The complainant federation states that FONAFE interfered in collective bargaining through Circular No. 009-2008/DE-FONAFE and violated the right to negotiate freely – even affecting the bargaining content – through Executive Board Decision
30. No. 002-2003/DE-FONAFE of 22 January 2003. In this regard, FONAFE categorically denies that it was interfering in the collective bargaining process through the abovementioned circular, as the circular makes reference only to the general regulations that are in force and to a general procedure relating to the organization of employer representatives, and at no time has there been any participation by FONAFE or any suggestion of its participation in the employment relationship or in the related collective bargaining. Ultimately, FONAFE requests only that it be informed of the outcome. In addition, it should be noted that in the same circular, FONAFE expressly stated that:
31. ... it must be emphasized that under no circumstances shall FONAFE interfere or participate in the collective bargaining process held between the enterprises under its auspices and their respective unions.
32. 998. In this regard, Article 2(2) of the Right to Organise and Collective Bargaining Convention, 1949 (No. 98), states:
33. In particular, acts which are designed to promote the establishment of workers’ organisations under the domination of employers or employers’ organisations, or to support workers’ organisations by financial or other means, with the object of placing such organisations under the control of employers or employers’ organisations, shall be deemed to constitute acts of interference within the meaning of this Article.
34. 999. In this regard, FONAFE has at no time sought to promote the establishment of employers’ or workers’ organizations in order to control them; it has solely acted in accordance with the powers conferred upon it by law, with the objective of ensuring that, in the collective bargaining process, the budget constraints set with regard to workers’ pay are met, in order to ensure that public welfare takes precedence over individual welfare.
35. 1000. According to the complainant, FONAFE sets pay ceilings and guidelines using a non-existent power and does not have the right to participate directly in collective bargaining. In this respect, as mandated by Act No. 27170 providing for its establishment, FONAFE directs, approves, regulates and supervises facets of both the budget and the efficient management of the enterprises under its auspices. Thus, it has the authority to issue guidelines and communications in this regard, which must be implemented by the enterprises, as well as communications that seek simply to align the enterprises to a budgetary point of view; these constraints are general and not specifically defined, and there are no references to the labour relations of each enterprise. Furthermore, it should be taken into account that the aim of the guidelines is to comply with the budgetary policy for state enterprises with regard to pay; as mentioned above, the objective is not to build up the State’s assets, but rather to serve the public good, avoid excessive expenditure and reinvest the proceeds for the good of society.
36. 1001. The Government also provides in its communication of 24 February 2009 a report by the Office of the Legal Adviser of the Ministry of Labour, endorsed by the Director-General of that Office, citing a distinguished Professor Neves, who explains that collective agreements have a regulatory status that is inferior to state regulations. He adds, however, that “as collective autonomy is guaranteed by the Constitution, the law cannot establish constraints that undermine it”. Therefore, it must be ascertained in each case which limitations apply to collective bargaining, and which do not. Legal regulations of relative inviolability set upper limits that cannot be exceeded when exercising private autonomy, while inviolable legal regulations totally exclude the exercise of private autonomy. National and comparative experience shows that both types of regulations have been issued as part of the framework of the stabilization programmes designed to curb the inflationary effects of a situation of economic crisis. In such cases, there is a clash between two constitutional values: the quality of life of the population on the one hand, and collective autonomy on the other. Thus, neither value takes absolute precedence over the other. The report of the Office of the Legal Adviser of the Ministry of Labour then sets out the principles of the Committee on Freedom of Association with regard to collective bargaining and adds that the available doctrine (Dolorier) on the matter maintains that the Committee on Freedom of Association’s position with regard to state intervention in collective bargaining distinguishes between two sets of circumstances:
37. – In normal situations, the social partners have full freedom to exercise the right to collective bargaining. However, for considerations of general interest, they may voluntarily limit their bargaining expectations. In such cases, the Committee recommends that the Government bring together the bargaining parties, set procedures for institutionalized discussions or even legally challenge collective agreements. These mechanisms constitute a preventive measure against any potential undesirable effects that the agreements might have on the national economy.
38. – In serious crisis situations that require quick and effective action, the Committee considers that States have an obligation to intervene in order to find a solution, even if this means a total restriction of the right to collective bargaining.
39. 1002. For all these reasons, the Office of the Legal Adviser concludes that:
40. – In the case presented by the FTLFP, a restriction was placed on the pay-related content of the collective bargaining process, violating the essence of this constitutional right, as the restriction was allegedly imposed unilaterally and permanently, without prior consultations with the workers’ representatives, and without the considerations of general interest being explained to the workers with a view to reaching some kind of agreement.
41. 1003. Consequently, in its communication of 30 October 2009, the Government indicates that it has referred the allegations concerning FONAFE budget ceilings on wages in public enterprises and the new allegations made by the FTLFP on 3 November 2008, denouncing acts of employer interference with regard to the right enjoyed by some union officials to take union leave at any time, to FONAFE (so that it can defend its position as appropriate). In addition, the Government indicates that it has requested information concerning the labour inspection in relation to the issue of union leave.

C. The Committee’s conclusions

1. 1004. The Committee notes that, in the present complaint, the complainant organization alleges that the FONAFE has interfered in the collective bargaining processes of state enterprises through FONAFE Circular No. 009-2008 of 27 February 2008 and Executive Decision No. 002-2003, which set pay ceilings applicable to the collective bargaining process for the 2007 period, furthermore providing, in the case in question, that the workers concerned would not receive a pay increase during that period. These requirements also provide that the bargaining committees appointed by the board of directors or management of the enterprise must submit a report containing an assessment of the trade union proposals and that the board of directors or general management of the enterprise must approve the final bargaining proposal presented by the bargaining committee (of the enterprise); likewise, once the collective bargaining process has been completed, the bargaining committee has to provide written evidence of compliance with the established parameters.
2. 1005. The Committee takes note of FONAFE’s position (attached to the Government’s reply) categorically denying it issued requirements that interfere in the collective bargaining process or that it has the power to intervene in and oversee the collective bargaining process in each state enterprise; nevertheless, as the governing body of state enterprise activity, FONAFE has, through its guidelines, set a ceiling on pay in accordance with the budget for state enterprises and in line with the budget available to the enterprise, both of which are aligned with the operative and strategic plans of the enterprise. FONAFE does not participate in the development of economic proposals (of the representatives of the enterprise in the collective bargaining process) but rather approves the overall budget of state enterprises, with the aim of drawing up a budget with parameters that are comprehensive or general in scope and placing general pay ceilings on total expenditure (including with regard to staff overheads). State enterprises have full authority and discretion with regard to the implementation of its internal wage policy and labour contingency payments; i.e. the enterprise is entitled to give instructions to the members of its bargaining committee on the parameters that should be used to shape the collective bargaining proposals, which should respect the budgetary constraints provided by law with regard to workers’ pay, in order to avoid excessive expenditure and reinvest the proceeds for the good of society, so as to meet a public need, since state enterprises do not have profit making as an objective.
3. 1006. The Committee takes note of the Government’s observations (contained in the report signed by the Director-General of the Office of the Legal Advisor) in which, after referring to the principles of the Committee on Freedom of Association, it concludes that, in the cases raised in the complaint, a restriction was placed on the pay-related content of the collective bargaining process, violating the essence of this constitutional right, as the restriction was imposed unilaterally and permanently, without prior consultations with the workers’ representatives, and without the considerations of general interest being explained to the workers with a view to reaching some kind of agreement.
4. 1007. The Committee notes that FONAFE Circular No. 009-2008 (guidelines for collective bargaining in enterprises under the auspices of FONAFE) provides, among other things, that:
   • – The board of directors or manager of the enterprise shall, by means of the relevant document, appoint the members of the bargaining committee representing the enterprise (hereinafter “the bargaining committee”) and set out the parameters on the basis of which negotiations must be carried out with union representatives. These parameters must be in strict compliance with the legal framework currently in force.
   • – Prior to the conclusion of a collective agreement, the bargaining committee shall present a report to the general management of the enterprise, containing an assessment of the proposals made by the union representatives. On the basis of this report, the bargaining committee is required to issue a final bargaining proposal, which must be approved by the board of directors or general management of the enterprise for presentation to union representatives.
   • – Once the collective bargaining process is complete, the bargaining committee shall, in a written report, substantiate and demonstrate compliance with the parameters that were set for it. This report must be submitted to the social body that set the parameters, which in turn must send a copy to FONAFE for reference.
5. 1008. The Committee considers that these guidelines refer in part to the appointment of employer representatives in cases involving collective bargaining in public enterprises and in part to the parameters for bargaining and monitoring compliance with these parameters. Taking into account that the overall budgets are previously adopted by other public bodies, the Committee considers that the requirement that the management of the enterprise must oversee the final bargaining proposals made by those negotiating on behalf of the enterprise does not violate the principles of collective bargaining.
6. 1009. The Committee notes, nevertheless, that the same FONAFE Circular No. 009-2008 provides that: “It must be taken into consideration that, according to the guidelines on the budgetary process and administration of enterprises under the auspices of FONAFE, when increasing pay and/or increasing or improving social benefits, working conditions and allowances, etc., the pay-scale ceilings set in the remuneration policies currently in force must serve as the upper limit and the relevant budget previously approved by FONAFE must be available.”
7. 1010. In this respect, the Committee wishes to recall its principles with regard to wage restrictions in collective bargaining in the public sector. In particular, the Committee has indicated that, with regard to the requirement that draft collective agreements in the public sector must be accompanied by a preliminary opinion on their ?nancial implications issued by the ?nancial authorities, and not by the public body or enterprise concerned, the Committee noted that it was aware that collective bargaining in the public sector called for veri?cation of the available resources in the various public bodies or undertakings, that such resources were dependent on state budgets and that the period of duration of collective agreements in the public sector did not always coincide with the duration of the State’s budgetary law – a situation which could give rise to dif?culties. The body issuing the above opinion could also formulate recommendations in line with government economic policy or seek to ensure that the collective bargaining process did not give rise to any discrimination in the working conditions of the employees in different public institutions or undertakings. Provision should therefore be made for a mechanism which ensures that, in the collective bargaining process in the public sector, both trade union organizations and the employers and their associations were consulted and could express their points of view to the authority responsible for assessing the financial consequences of draft collective agreements. Nevertheless, notwithstanding any opinion submitted by the financial authorities, the parties to collective bargaining should be able to conclude an agreement freely [see Digest of decisions and principles of the Freedom of Association Committee, fifth (revised) edition, 2006, para. 1037].
8. 1011. Furthermore, given that according to the complainant organization there were no pay increases for the 2007 period in two state-owned electricity companies, which was not denied by the Government, the Committee recalls, in general, that if, as part of its stabilization policy, a government considers that wage rates cannot be settled freely through collective bargaining, such a restriction should be imposed as an exceptional measure and only to the extent that is necessary, without exceeding a reasonable period, and it should be accompanied by adequate safeguards to protect workers’ living standards [see Digest, op. cit., para. 1024].
9. 1012. The Committee notes that, according to the observations received from the Government, in the various cases mentioned by the complainant organization, wage restrictions have been imposed unilaterally and permanently, without prior consultations with the trade union representatives, and without the considerations of general interest being explained with a view to reaching some kind of agreement.
10. 1013. In these circumstances, taking into account the principles mentioned above and given that the Government has informed the FONAFE of the issues raised by the Committee, the Committee requests the Government to take the necessary measures to ensure that trade unions in the public enterprises are consulted when setting budget ceilings for public enterprises with regard to wages, so that the trade unions concerned may assess the situation, express their views and positions and discuss with the authorities the considerations of general interest that these authorities may deem it necessary to highlight.
11. 1014. Lastly, the Committee awaits the observations announced by the Government on the allegations contained in the latest communication from the complainant organization, concerning attempts to make the trade unions relinquish the entitlement enjoyed in several public enterprises to take trade union leave at any time and particularly anticipates the information expected by the FONAFE and labour inspection on these issues.

The Committee's recommendations

1. 1015. In the light of its foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) Taking into account the principles outlined in the conclusions, the Committee requests the Government to take the necessary measures to ensure that trade unions in the public enterprises are consulted when setting budget ceilings for public enterprises with regard to wages, so that the trade unions concerned may assess the situation, express their views and position and discuss with the authorities the considerations of general interest that these authorities may deem it necessary to highlight.
   • (b) The Committee awaits the Government’s specific observations on the allegations contained in the latest communication from the complainant organization, concerning attempts to make the trade unions relinquish the entitlement enjoyed in several public enterprises to take union leave at any time and particularly anticipates the information expected by the FONAFE and the labour inspection on these issues.