Interim Report - Report No 359, March 2011

Case No 2751 (Panama) - Complaint date: 24-NOV-09 - Follow-up

Allegations: Recent legal reforms and rulings contrary to the right of trade unions to free speech, to strike and to collective bargaining; freezing of recognition of 30 trade union organizations that had requested registration; interference in the functioning of trade union organizations; refusal to allocate education insurance funds to FENASEP and dismissal of a trade union leader; threats by the authorities to institute criminal proceedings against trade union leaders

1. 992. The complaints are contained in communications of the National Federation of Public Employees and Public Service Enterprise Workers (FENASEP) and the National Council of Organized Workers (CONATO) respectively dated 24 November 2009 and 30 June 2010.
2. 993. The Government sent its observations in communications dated 11 May, 11 November and 2 December 2010.
3. 994. Panama 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 complainants’ allegations

1. 995. In its communication dated 24 November 2009, FENASEP alleges that, on 30 July 2009, the Government enacted Act No. 43, reforming Act No. 9, of 1994, and Act No. 8, of 1998, respectively, structuring administrative and legislative careers. Act No. 43 eliminates tripartism, given that the previous act was based on the fundamental principle that the representatives of public servants on the Technical Committee and the Appeal and Conciliation Committee would be nominated by FENASEP. Act No. 43 eliminates this possibility.
2. 996. Despite the fact that the ILO supervisory bodies have urged that the minimum number of trade union members required by Panamanian legislation should be lowered, Act No. 43 raised the number to 50 in the public sector.
3. 997. Furthermore, FENASEP alleges that, on 9 October 2009, the current Minister of Labour dismissed the General Secretary of the Association of Employees of the Ministry of Labour and Social Welfare (ASEMITRABS) Mr Víctor C. Castillo Díaz (a labour inspector enjoying protection under the Conventions on labour inspection ratified by Panama), who is protected by section 17 of Act No. 43, which states that “the following public servants (even if they are not in the administrative service) can only be dismissed for the reasons established in this act: 1. The General Secretary of any association or federation of public servants, from the time of his selection until three months after the conclusion of the term of office for which he was elected ...”.
4. 998. Moreover, given that brother Castillo is a labour inspector, as stated in Staff Decree No. 102, the Minister of Labour, Dr Cortés, has also violated another Convention ratified by Panama in 1958, the Labour Inspection Convention, 1947 (No. 81), in particular Article 6 of that Convention which states that: “The inspection staff shall be composed of public servants whose status and conditions of service are such that they are assured of stability of employment and are independent of changes of government and of improper external influences.” The rights (enshrined in ILO Convention No. 81) of brother Castillo and other inspectors who have been dismissed by the current government, as well as those of others who will surely be dismissed, are being violated.
5. 999. Finally, FENASEP alleges that the Minister of Labour is attempting to disregard FENASEP as a trade union organization and is currently refusing to grant it education insurance funds, leaving thousands of public servants without the necessary protection (all the private sector trade union organizations are receiving the corresponding budget appropriation).
6. 1000. In its communication of 30 June 2010, CONATO alleges that Act No. 43 of 2009, and Act No. 4 of 2010, have removed the right of public officials dismissed unfairly and then reinstated through a ruling to receive the lost wages running from the moment of separation until that of reinstatement.
7. 1001. CONATO also alleges refusal to allocate 5 per cent of the education insurance to FENASEP. Section 4 of the cabinet decree of 27 July 1971, establishing the education insurance, states that it is the Trade Union Education Commission that is responsible for determining the use of education insurance funds for education or trade union training. Indeed, for many years, the abovementioned Commission approved the allocation of said funds to FENASEP, taking into account the fact that FENASEP is a unique and special trade union organization which operates within the public administration and which has been a part of CONATO for approximately 15 years. Moreover, on various occasions, a FENASEP representative has spoken before the International Labour Conference (ILC) on behalf of the entire Panamanian trade union movement. Furthermore, the education insurance is financed by deductions (1.25 per cent) from the salaries of all public workers. CONATO states that the Trade Union Education Commission is made up of three CONATO representatives, the Rector of the University of Panama, two technical experts on trade union education and the Minister of Labour (who presides over the Commission), with decisions being adopted by a majority. Furthermore, within this body, the Minister of Labour does not have the power to determine unilaterally how education insurance funds are allocated. The move to hold back these funds undoubtedly reflects the current Government’s anti-union policy.
8. 1002. Furthermore, the authorities orchestrated a libellous propaganda campaign to demonize and discredit the trade union leaders in the eyes of the public. In particular, they threatened to denounce various trade union leaders to the public ministry for alleged inconsistencies regarding the management of the 5 per cent of the education insurance. This anti-union campaign was undertaken despite the fact that section 224 of the Labour Code states that “The establishment of trade unions is in the public interest, being an effective means to contribute to the economic and social maintenance and development of the country, Panamanian popular culture and democracy”.
9. 1003. The CONATO also alleges that, through Ruling No. DM 280/09 of 15 December 2009, the Ministry of Labour and Labour Development (MITRADEL) implemented a manual of procedures for the Department of Social Organizations, with the aim of imposing these new rules on trade unions, federations, confederations and central workers’ organizations when they present documents concerning the functioning of trade unions. These rules consist of supervising and vouching for the electoral process of trade union organizations and associations; intervening ex officio or at the request of the parties to the disputes between trade union organizations or associations or within them and resolving them in accordance with the law. Furthermore, in cases in which trade unions are carrying out changes to their executive, prior to its establishment, any new executive must be approved by MITRADEL. This ruling attempts to overturn or repeal provisions of the ILO Conventions, the Political Constitution and the Labour Code which concern the right to elect trade union representatives freely and which limit the competence of the Ministry of Labour to the registration of the electoral process. The abovementioned ruling endangers the exercise of trade union rights.
10. 1004. The CONATO adds that the authorities of the Ministry of Labour have frozen 30 requests for the trade union registration over the last ten months, that is to say, they are trying to avoid applying the Labour Code.
11. 1005. Furthermore, section 7 of Act No. 29 of 8 June 2010 allows enterprises to operate for the first six years without undertaking bargaining processes concerning collective labour agreements. Moreover, section 8 of this Act fails to take into consideration the representation of social organizations of workers and employers, that is to say, the National Private Enterprise Council (CONEP) and CONATO, with regards the composition of the Administration Committee of the Special Economic Area of Barú.
12. 1006. Finally, CONATO alleges that Act No. 30 of 2010 frees employers from the duty of deducting trade union dues and transferring them to the trade union, this change having a major economic impact on trade unions. Moreover, the abovementioned act amends the Labour Code, restricting the workers’ right to strike and to have disputes resolved through arbitration.
13. 1007. Act No. 30 of 2010 also establishes that workers’ confederations, centrals and trade union federations not affiliated to any confederation or central shall be grouped together under the Workers’ Council of Panama (COTRAPA), with CONATO (the highest Panamanian workers’ body) being abolished. Formerly, it was CONATO which submitted short lists to the executive body for the nomination of the workers’ representatives to the ILC and the official Panamanian bodies. Now, these short lists will be submitted by COTRAPA, the workers’ confederations and centrals and the trade union federations so that the Government can manipulate the appointment of the workers’ representatives. Act No. 30 makes the situation worse by establishing that COTRAPA will be made up of a representative of CONATO, a representative of the Independent National Confederation of Labour Union Unity (CONUSI), a representative of each trade union confederation, a representative of each workers’ central and a representative of each workers’ federation.
14. 1008. Finally, CONATO refers to other violations of the labour rights of the workers not related to the ILO Conventions on freedom of association.

B. The Government’s reply

1. 1009. In its communication of 11 May 2010, the Government states that the allegations made by FENASEP in its complaint refer to a series of situations that this organization perceives as being violations of trade union rights, as well as to FENASEP and ASEMITRABS, the latter body being completely unknown to the majority of the public servants working at the Ministry of Labour. Consequently, there is a need to exhaustively examine the internal legislation, given that the public administration is built on a basis for management and rules which are distinct from those governing private enterprises. The latter are fundamentally covered by the provisions of the Labour Code, which defines the concept of trade union and how such bodies are granted legal personality, the situation regarding the public administration being very different.
2. 1010. As to the amendment of Act No. 9 of 1994, and Act No. 8 of 1998, structuring administrative and legislative careers respectively, the Government states that it considered it appropriate to reformulate the provisions of said Act, given that Act No. 24 of 2 June 2007 distorts the spirit of entry into the administrative service, which should be one of merit and competition. The Act of 2007 clearly deviates from the main objective of the administrative service career path by stating that acting public servants will only be evaluated if they can prove that they meet the minimum requirements for entry into the service and will not be required to take part in administrative service open competitions.
3. 1011. As to the legal minimum number of members of a trade union organization stated by FENASEP and established under Act No. 9 of 1994 (Administrative Careers Act), the Government states that, originally, the number was 50. In 2007, without any prior study being carried out, the minimum number of members required to form an organization of public servants was amended to 40. The only effect the new amendment of 2009 has is to re-establish 50 as the minimum number of members required to form an organization of public servants. It is important to highlight this fact given that the Administrative Careers Act neither refers to nor governs trade union organizations, as pointed out by FENASEP in its complaint.
4. 1012. Furthermore, FENASEP affirms that Act No. 43 of 30 July 2009 eliminates the tripartism, advocated by the ILO, by preventing FENASEP from participating in the Executive Committee and the Appeal and Conciliation Committee of the Administrative Service. It should be pointed out, in this regard, that the participation of public servants, as well as of the Government and the users, in said bodies is enshrined in the provisions of said act.
5. 1013. The Government refers to the allegation that Mr Víctor C. Castillo Díaz is protected by section 17 of Act No. 43 of 2009, given that he holds the post of Secretary General of ASEMITRABS. In this regard, the Government states that the abovementioned employees’ association is not currently operating within MITRADEL. The officials know nothing about ASEMITRABS or the activities of any such organization of public servants. In reality, said association does not operate within the institution. Furthermore, Mr Díaz has lodged an administrative appeal of full jurisdiction with the Third Administrative Disputes Chamber of the Supreme Court of Justice. Consequently, the Panamanian State must not issue an opinion in this regard because the case is currently being examined by the internal judicial authority which will decide on the legal merit of the claim.
6. 1014. FENASEP calls itself a trade union organization and states that it is being denied education insurance funds, with thousands of public servants being left without the necessary protection, given that all the trade unions in the private sector have received the corresponding budget appropriation. In this regard, the Government states that, under Panamanian positive law, the legislation is clear with regards the difference between a trade union and an association of public servants. The following is an example which demonstrates that point. There was an attempt to establish a trade union at the University of Panama, referred to as an enterprise workers’ trade union. This registration of a trade union, made up of public servants working at the University of Panama, was presented as that of an enterprise trade union. However, the law does not permit the establishment of this type of organization for several reasons: (1) it is not composed of “workers” as defined according to the provisions of section 82 of the Labour Code; (2) the persons applying to register an enterprise trade union are employed at the University of Panama, an entity which, in accordance with article 103 of the Political Constitution, is an Official University of the State with autonomous status. Hence, all persons employed there are public servants, as defined by article 299 of the Constitution: “Public servants are persons who are temporarily or permanently appointed to posts in the executive, legislature or judiciary, municipalities, or autonomous or semi-autonomous entities; and in general persons who are remunerated by the State”; (3) this trade union calls itself an enterprise trade union and it is therefore necessary to clarify this term in accordance with section 97 of the Labour Code which states “For the purpose of labour standards, enterprise means the structure encompassing activities and means which constitute an economic unit for the extraction, production or distribution of goods or services for profit or otherwise”. Clearly, in view of the provisions of the Constitution, the University of Panama does not meet this definition. It is important, therefore, to point out that registration of a trade union composed of public servants of the University of Panama is not feasible, since this violates clear, specific standards of the Labour Code.
7. 1015. The Government highlights that section 1 of the Labour Code governs the relationship between capital and labour, i.e. it refers to the employment relationship between a private investor and an employee. Such a private investor, as opposed to a public or official investor, has the legal title of “employer” and is defined as “the natural or legal person for whom the worker provides services or performs work” (section 87 of the Labour Code). An employee, as opposed to a public servant, is given the title of “worker” and is defined by law as the natural person who has the obligation “by means of a verbal or written employment contract, explicit or presumed, individually or as part of a group, to provide a service or perform a task while subordinate to or dependent on a person” (section 82). The Labour Code does not govern employment relationships between public servants and state/public institutions, as provided for in section 2: “Public employees shall be governed by the administrative career regulations, except where specific provision is made for the application of any rules of the present Code”. Article 3 of the Constitution states that public servants are persons appointed within, inter alia, autonomous or semi-autonomous entities, and in general those who receive remuneration from the State; therefore, it is not the provisions of the Labour Code but the administrative career regulations which are applicable, as laid down by section 2 of the Code, and therefore it is not possible to claim treatment and benefits, such as the education insurance appropriation, equal to those enjoyed by trade unions if associations of public servants are not covered by those benefits.
8. 1016. In its communication of 2 December 2010, the Government transmits a ruling of the Supreme Court of Justice, of 17 February 2006, recognizing the right of public servants to receive the lost wages and other benefits for the period between the date of their unfair dismissal and their reinstatement. Regarding this last point, in its communication of 11 November 2010, the Government states that the complainants state that in the world of work (both private and public), as a general rule, any worker who has been unfairly dismissed and then reinstated through a ruling, has the right to receive the lost wages for the period between the moment of separation and reinstatement. Furthermore, according to the complainants, as a result of Act No. 43 of 30 July 2009, public servants have had this right taken away from them. The Government states that this claim is groundless, given that Act No. 43 of 2009 does not contain any provision for the removal of such a right. This is demonstrated by the cases of the officials of MITRADEL, who were dismissed and consequently brought successful legal actions which resulted in the State having to pay the employment benefits resulting from the actions.
9. 1017. As to the alleged disregard for FENASEP as a trade union organization, the Government states that in the complaint it is claimed that the authorities disregard Articles 10 and 15 of the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87). However, Artitcle 10 determines the meaning of the term “organization”, and therefore the authorities cannot be held to have disregarded anything because the article merely refers to the meaning of a term. Article 15 determines the obligation of those Members of the International Labour Organization (ILO) whose ratifications have been registered with the Director-General.
10. 1018. With regards this last point, the Government highlights that it responded to the appeal made by the Committee of Experts on the Application of Conventions and Recommendations and the Standards Committee of the ILC of the ILO, setting out the recommendations of the Committee on Freedom of Association concerning Case No. 1931, and the proposals that the Office wishes to implement. Among other things, a formal request was made to the ILO for technical assistance from the Office in addressing issues concerning freedom of association, in order to seek formulas of compromise making it possible to harmonize national legislation and practice with the provisions of Conventions Nos 87 and 98.
11. 1019. It should be reiterated that under Panamanian law there exists a clear and defined difference between a trade union organization and an association of public servants. The Labour Code does not govern employment relations between public servants and government or public institutions, in accordance with the final paragraph of section 2, which states that: “Public employees shall be governed by the administrative career regulations, except where specific provision is made for the application of any rules of the present Code”.
12. 1020. The Political Constitution of the Republic determines that “Public servants are persons who are temporarily or permanently appointed to posts in the executive, legislature or judiciary, municipalities, or autonomous or semi-autonomous entities; and in general persons who are remunerated by the State”.
13. 1021. Furthermore, for FENASEP to be considered as a trade union organization, the Political Constitution would have to be amended, which would be no easy task according to article 313, Title XIII of the Constitution on “Reform of the Constitution”, which states that:
    • The National Assembly, Cabinet Council and the Supreme Court of Justice all have the power to propose constitutional reforms. Said reforms must be approved through one of the following procedures:
14. (1) Through a constitutional act, approved in three debates by an absolute majority of the members of the National Assembly, which must be published in the Official Journal and transmitted by the executive body to said Assembly within the first five days of the ordinary sessions following the installation of the National Assembly elected at the last general elections, so that in its first term of office the reform may be debated and approved without amendment, in one single debate, by the majority of the members making up the Assembly.
15. (2) Through a constitutional act approved in three debates by an absolute majority of the members of the National Assembly, in one term of office, and also approved, in three debates, by an absolute majority of the members of the abovementioned Assembly, during the following term of office. At that time the text approved during the previous term of office may be amended. The constitutional act approved in this way must be published in the Official Journal and submitted to direct popular consultation through a referendum to be held on the date set by the National Assembly, within a period of no less than three months and no more than six months from the time of the approval of the constitutional act during the second term of office.
16. 1022. As to the allegation regarding the refusal to grant 5 per cent of the education insurance to FENASEP, the Government states that FENASEP is a representative association of the public sector workers of Panama, with legal personality granted by the executive body through Ruling No. 345 of 20 September 1984, and is therefore governed by Title VIII, chapter I, section 174, and the following articles of Act No. 9 of 20 June 1994 “establishing and regulating administrative careers”.
17. 1023. Section 175 of the same Act states that “Associations of public servants shall be recognized by the executive body through the Ministry of Government and Justice, with the opinion of the General Directorate of Administrative Careers through a reasoned ruling and subject to compliance with the requirements established by law”. Section 175 goes on to state “Associations shall be granted legal personality once they have been registered in the Associations of Public Workers Section of the public registry, and shall enjoy the same rights and be governed by the same limitations as any other not-for-profit association”.
18. 1024. The above information is fundamental in determining whether FENASEP has the right to receive education insurance funds for trade union education under Act No. 13, section 2(2), of 28 July 1987.
19. 1025. This act states that the 5 per cent appropriation shall be used for “trade union education”, that is to say, by trade union organizations recognized by the executive body and whose legal personality shall be determined by registration with MITRADEL. FENASEP does not fall into this category, because, although it was granted recognition and consequent legal personality by the executive body, this was done through the Ministry of Government on the understanding that FENASEP was a not-for-profit association, and in no way a trade union, as if it were, its legal personality would be registered with MITRADEL.
20. 1026. The Government opines that the way in which FENASEP was granted its legal identity and the purposes for which it was established cannot be disregarded. While the purposes of FENASEP seem to coincide with those of a trade union organization and with participation in CONATO, the federation does not fall into this category. Therefore, the idea that FENASEP should receive financial support is questionable, given that only trade unions are entitled to such funding.
21. 1027. FENASEP cannot claim to have been established under Act No. 9 of 28 June 1994 and then use other provisions of Panamanian positive law to claim benefits to which, in the view of the Government, it is not legally entitled. Had financial support been granted, then this would mean that MITRADEL had committed an act of corruption and diversion of public funds, which would obviously be illegal.
22. 1028. As to the allegation that the Government has dismissed trade union leaders within the Ministry of Labour, disregarding the grounds mentioned in Act No. 43 of 2009, the Government states that no employees’ associations operate within MITRADEL, and therefore, no trade union leaders have been dismissed.
23. 1029. As to the alleged campaign aimed at discrediting the trade union leaders, the Government states that it is clear that the complainants have made a series of fictitious statements. The complainants refer to a report issued by the Office of the Comptroller General of the Republic, dated 11 May 2010, examining the way in which trade unions spend public money (such as the education insurance), the use of which must be supervised by the State owing to its provenance. This report identified serious administrative irregularities and the diversion of funds by some trade unions, as a result of which the State was clearly obliged to send the findings of the report to the Public Ministry, so that the latter could, subject to compliance with the law, identify those responsible, should they exist. In a State governed by the rule of law, these principles apply to all citizens residing in the Republic of Panama, with no exception being made for members of a trade union, and therefore no articles of Convention No. 87 have been violated, nor has the freedom of association been infringed in any way.
24. 1030. As to the allegations regarding the manual of procedures for the Department of Social Organizations, established under ministerial Ruling No. DM 280/09 of 15 December 2009, the Government states that this instrument is used by the Department of Social Organizations of MITRADEL. The manual covers the mechanism and requirements that must be respected with regards applications or procedures within said department. It in no way limits the freedom of association, on the contrary, it reiterates, for the benefit of trade union organizations, the formalities with which they sometimes fail to comply (thus impeding the effective and timely management of procedures). The manual also gives details of and expands on the legal framework, in keeping with the Constitution and the Labour Code, allowing officials to be proactive and to manage trade union structures in due form (assemblies, vote counting, leave to attend seminars, reform of statutes, etc.). The Department of Social Organizations does not, however, interfere with regards changes to executive committees, nor issues involving trade union immunity. Rather, those changes are transmitted to the department so that the database can be updated and the information certified should such an assurance be sought by interested parties. The Government attaches a copy of the manual of procedures, published in the Official Journal No. 26459 of 29 January 2010.
25. 1031. As to the alleged freezing of 30 requests for trade union registration over the last ten months, thus avoiding implementation of the Labour Code and infringing provisions of Conventions Nos 87 and 98, the Government states that, once the appropriate inquiries were carried out before the Department of Social Organizations, nine legal personalities were granted under the current administration, far exceeding the number granted under any previous administration. The Government highlights that section 356 of the Labour Code establishes that:
    • Once the 15 calendar days referred to under articles 352 and 353 have expired, should the request for registration not have been rejected or objected to, the trade union, federation, confederation or workers’ central organization shall be considered to be registered for all legal purposes and, consequently, the Ministry is obliged to issue the respective documents and certifications and to add the corresponding entry to the registry of social organizations.
26. 1032. The Government goes on to state that, under the above provision, once the period established has expired, should the request for registration not have been rejected or objected to, the trade union, federation, confederation or workers’ central organization shall be considered to be registered. Thus, it would be impossible to freeze 30 requests for trade union registration, given that under the law, they would have to have been registered and the corresponding certifications issued. The Government clarifies, however, that it would be impossible to grant legal personalities outside the framework of the law, that is to say, to bodies which fail to comply with the requirements established under the Act through actions such as: the presentation of a provisional list of members, failure to provide personal identity cards, errors of form (and sometimes of substance) concerning statutes, as well as the founding instrument or its clauses, among other causes or omissions leading to refusal of registration.
27. 1033. As to Act No. 29 of 8 June 2010, establishing a special regime for the area of Barú, the Government states that for several decades now Puerto Armuelles and the district of Barú, in particular, have suffered from social, cultural, economic and health problems, owing to the failure of previous administrations to implement sustainable policies, an issue that the Government is addressing in a responsible manner. Assessments were carried out across the region, in order to identify possible opportunities for development. It was concluded that there was a need to establish an appropriate mechanism for attracting economic investment to the district in the form of a special economic area. The project took the form of a suitable integral development plan, based on the establishment of a special integral regime for the establishment and operation of enterprises, manufacturing industries and any economic activity that will contribute to the national and global economy through the export of goods and services, promoting investment and encouraging scientific, technological, economic, cultural, educational, health and social development in the country.
28. 1034. The labour legislation was drawn up with employment promotion in mind, guaranteeing a 24/7 business environment through changes in terms of varying shifts and rest days (not necessarily Sundays). MITRADEL set up the Administration Committee of the Special Economic Area of Barú, which carried out large-scale consultations, dialogues and presentations aimed at the workers of the area, who, in turn, expressed their support for the project.
29. 1035. As to the allegations relating to Act No. 30 of 2010, the Government states that it concluded the National Tripartite Dialogue Forum with sectors of civil society, which met for over three months of intense debate over Act No. 30. Tripartite agreements were signed under which it was agreed that Act No. 30 would be split into six bills, to be approved at a future date by the legislative body.
30. 1036. Act No. 30 was repealed in October 2010 in the framework of a national tripartite dialogue which led to the approval of various acts by the National Assembly, including an act containing labour reforms (all of which were duly agreed on at the Tripartite Dialogue Forum). The arguments of the complainants were rendered groundless by the repeal of Act No. 30.
31. 1037. Finally, the Government reiterates that it respects the Conventions on the freedom of association and collective bargaining that it has ratified. It is for this reason that it has been making every effort to ensure their implementation within a framework of dialogue with the social actors. Therefore, the current labour administration, taking into account the reality of the current situation and in order to comply with Conventions Nos 87 and 98 on freedom of association and to promote the social dialogue, has been examining the possibility of establishing a higher labour council as the consultative tripartite body of the executive body, attached to MITRADEL, with the aim of regulating dialogue and promoting economic and social cooperation between the public authorities and the employers’ and workers’ organizations of the country with regards labour issues, with the technical support of the ILO.

C. The Committee’s conclusions

1. 1038. The Committee notes that, in the present case, the complainant organizations allege recent legal reforms and rulings restricting fundamental trade union rights, refusal to recognize the public servants’ organization FENASEP in practice, the exclusion of FENASEP from tripartite bodies, refusal to grant FENASEP educational insurance funds for trade union training, the freezing of the recognition of 30 trade union organizations and the dismissal of a trade union leader.
2. 1039. As to the allegations regarding restrictions on trade union rights contained in Act No. 30 of 2010, concerning the right to strike, the deduction of union fees through a check-off facility, the possibility of recourse to arbitration and the establishment, in the light of this Act (or law), of COTRAPA in order to suppress CONATO, the Committee takes due note of the Government’s statements concerning the repeal of Act No. 30 in October of 2010, within the framework of a national tripartite dialogue which led to the approval by the National Assembly of various acts containing reforms which had been duly agreed on.
3. 1040. As to the allegations regarding Act No. 29 of 8 June 2010, establishing a special regime for the area of Barú, which includes a provision allowing enterprises to operate for the first six years without undertaking bargaining processes concerning collective labour agreements (section 7 of the Act) and that the employers’ central CONEP and the workers’ central CONATO are not represented on the Administration Committee of the Special Economic Area of Barú, the Committee notes that the Government states that the aim of the Act is to address important social, economic and cultural issues while attracting economic investment and promoting employment. According to the Government, the Ministry of Labour and Labour Development established the Administration Committee of the Special Economic Area of Barú, which has carried out consultations, dialogues and presentations aimed at the workers of the area, who, in turn, have expressed their support for the project.
4. 1041. The Committee wishes to point out that the right to collective bargaining is a fundamental right of the workers and their organizations and that Convention No. 98 only allows exceptions to the right to collective bargaining with regards officials engaged in the administration of the State, the armed forces or the police. Consequently, the Committee considers that section 7 of Act No. 29 constitutes a direct violation of Convention No. 98 and therefore urges the Government to take the necessary measures to repeal said provision without delay. Furthermore, noting that the Government has not responded to the complainants’ allegation that the representatives of the country’s workers’ and employers’ centrals are not represented on the Administration Committee of the Special Economic Area of Barú, the Committee, recalling the importance of consultation with the most representative employers’ and workers’ organizations with regards labour issues, requests the Government to consider, together with those organizations, the possibility of the latter being represented on the Administration Committee, in order that they might be consulted on issues affecting their members, and to keep it informed in this regard.
5. 1042. As to the allegations regarding a manual of procedures for the Department of Social Organizations (ministerial ruling of 15 December 2009), which according to the complainants restricts the exercise of trade union rights, the Committee takes note of the Government’s statement that said Manual does not limit freedom of association and that it is in keeping with the Constitution and the Labour Code. The Committee observes that the complainant organizations highlight in particular the fact that the Manual requires that the rules governing executives must be “approved” by the Ministry of Labour and allows this Ministry to intervene ex officio in disputes between trade union organizations, as well as to supervise trade union electoral processes. The Committee observes that the text of the Manual (copy provided by the Government) does not seem to have been subject to consultations with the most representative trade union organizations. Rather, it is claimed that the Manual consists of a series of flexible procedures aimed at speeding up the administrative process and the Government is ready to consider any recommendations that might arise from its application. The Committee considers that certain terms employed in the Manual, such as the “approval” of executive committees, may give rise to problems of interpretation and requests the Government to examine said Manual with the most representative workers’ organizations in order to clear up any misunderstandings and produce a text which enjoys as much support as possible.
6. 1043. As to the alleged increase of the minimum number of public servants required to establish a trade union association in the public sector (50 servants), in the light of Act No. 43, the Committee takes note of the Government’s statement that: (1) the number of public servants required stood at 50 in 2007 (Act No. 9); (2) without any prior study being carried out, the minimum number of members required to form an organization of public servants was amended to 40; and (3) the new amendment of 2009 (Act No. 43) re-established 50 as the minimum number of members required to form an organization of public servants. In this regard the Committee wishes to highlight the principle that “The requirements prescribed by law for the establishment of a trade union should not be applied in such a manner as to delay or prevent the establishment of trade union organizations. Any delay caused by the authorities in registering a trade union constitutes an infringement of Article 2 of Convention No. 87.” Furthermore, the Committee refers to the article concerning the principle it established regarding enterprise trade unions, which states that “The establishment of a trade union may be considerably hindered, or even rendered impossible, when legislation fixes the minimum number of members of a trade union at obviously too high a figure, as is the case, for example, where legislation requires that a union must have at least 50 founder members.” [see Digest of decisions and principles of the Freedom of Association Committee, fifth edition, 2006, paras 279 and 284].
7. 1044. The Committee also recalls that the Committee of Experts had considered the requirement of 50 public servants for the establishment of a trade union association in Panama to be excessive and had requested the Government to reduce that figure. In these circumstances, the Committee requests the Government to take measures to amend Act No. 43 in order to reduce the minimum number of public servants necessary to establish a trade union association, given that an excessively high minimum number could restrict trade union rights, in particular in certain public institutions and small municipalities.
8. 1045. As to the allegation that, in the light of Act No. 43 of 2009, public servants dismissed unfairly and then reinstated through a ruling do not have the right to receive the lost wages for the period between the moment of separation and that of reinstatement, the Committee notes the Government’s statement that this allegation is groundless and notes that the Government backs up this claim by referring to two Supreme Court rulings obliging the State to pay the wages and other benefits. The Committee notes that the Government only sent one of the rulings, dated 17 February 2006, when, in fact, Act No. 43 was adopted in 2009. The Committee would therefore be grateful if the Government would send other rulings supporting its statement.
9. 1046. As to the allegations regarding the organization of public servants FENASEP i.e. refusal by the authorities to recognize FENASEP in practice, despite the fact that FENASEP representatives have participated in the ILC as delegates on several occasions, exclusion of representatives of this organization from the Technical Committee and the Appeal and Conciliation Committee in the light of Act No. 43 of 30 July 2009, denial of education insurance funds (trade union training) previously enjoyed by FENASEP – affecting, in particular, all those public servants from whose salaries 1.25 per cent is deducted for the education insurance (thus discriminating between trade union associations of public servants and private sector trade unions), the Committee notes the Government’s statements that: (1) FENASEP is an association of public servants who are remunerated by the State, with legal personality granted by the Ministry of Government, governed by the Administrative Careers Act as a not-for-profit association, and not a trade union governed by the Labour Code and registered with the Ministry of Labour; (2) therefore it is not possible to claim treatment and benefits, such as the education insurance appropriation, equal to those enjoyed by trade unions if associations of public servants are not covered by those benefits; and (3) Act No. 43 of 30 July 2009 ensures the participation of public servants and the Government in the Expert Committee and the Appeal and Conciliation Committee of the Administrative Career Service. According to the Government, the Constitution would have to be amended for FENASEP to be considered as a trade union organization. The Government recognizes, however, that FENASEP participates in CONATO and was established for purposes which seem to coincide with those of a trade union organization. The Committee also recalls that, under the law, FENASEP enjoys the right to conclude collective agreements.
10. 1047. The Committee wishes to highlight that associations of public servants, whether they call themselves trade unions or not, must enjoy all the rights and guarantees contained in Convention No. 87, which only allows the armed forces and the police to be excluded from enjoying such rights and guarantees. The Committee wishes to emphasize that the public servants’ organization FENASEP (whose representatives have participated in the ILC on several occasions and which is considered by the Government to be a representative association) recently had its right to enjoy education insurance funds for trade union training withdrawn despite the fact that public servants contribute 1.25 per cent of their salaries to said fund. Moreover, FENASEP has been excluded from the Expert Committee and the Appeals and Conciliation Committee of the Administrative Career. The Committee believes that the arguments for these exclusions advanced by the Government do not justify such treatment and requests the Government to initiate a constructive dialogue with FENASEP in order to find a solution to the problems which will avoid any risk of discrimination against the organization while allowing it to be recognized for all purposes in connection with its representativeness.
11. 1048. As to the allegation that the Ministry of Labour has frozen 30 requests for trade union registration over the past ten months, the Committee notes that the Government states that the current administration has granted nine new legal personalities to trade union organizations (far exceeding the number granted under any previous administration), recalling that in cases of administrative silence trade union organizations having applied for registration should be considered to be registered. The Committee also notes that the Government states that legal personality cannot be granted unless the legal requirements have been fulfilled (submission of the list of members, presentation of identity cards, failure to provide founding act or the clauses of the statutes). The Committee requests the Government to indicate those trade unions which have not been registered despite the fact that they have submitted applications for registration and to communicate the reasoned administrative rulings behind the non-registration of trade union organizations.
12. 1049. As to the dismissal of Mr Víctor C. Castillo Díaz (according to the allegations, the General Secretary of the Association of Employees of ASEMITRABS) in violation of Act No. 43 on the protection of trade union leaders (trade union immunity), the Committee notes the Government’s statements to the effect that: (1) this association is completely unknown to the majority of public servants working within the Ministry of Labour and no employees’ associations currently operate within the Ministry; (2) Mr Víctor C. Castillo Díaz lodged a judicial complaint before the Third Administrative Disputes Chamber of the Supreme Court of Justice, which will rule on the legal merit of the claim. The Committee requests the Government to communicate the result of the appeal lodged against the dismissal of Mr Víctor C. Castillo Díaz and, given that the Government disputes his appointment as General Secretary and even the existence of his association of public employees (despite the fact that the complainant organizations have sent a public instrument drawn up by a solicitor which vouches for ASEMITRABS’ establishment and executive committee), to indicate whether said association has applied for registration and legal personality and, should that be the case, to indicate the reasons why that application was unsuccessful.
13. 1050. As to the alleged campaign to discredit the trade union leaders in the eyes of the public, in particular involving threats to denounce various trade union leaders to the Public Ministry for alleged inconsistencies in the management of the 5 per cent of the education insurance, the Committee notes the Government’s statements to the effect that: (1) the allegations are a series of fictitious statements; (2) the Comptroller General of the Republic issued a report on 11 May 2010 examining the way in which trade unions spend public funds (such as the education insurance). This report identified serious administrative irregularities and the diversion of funds by some trade unions, as a result of which the State was clearly obliged to send the findings of the report to the Public Ministry, so that the latter could, subject to compliance with the law, identify those responsible, should they exist. The Committee requests the Government to send it copies of any rulings or charges brought by the Public Ministry against trade union leaders for illicit diversion of public funds.
14. 1051. Finally, the Committee notes that the Government has been examining the possibility of establishing a higher labour council as a consultative body in order to promote social dialogue concerning labour issues with the technical support of the ILO, and that it has formally requested ILO technical assistance in harmonizing national legislation and practice with the provisions of Conventions Nos 87 and 98 (the Government highlights that request in the part of this document regarding the allegations affecting FENASEP). The Committee expresses the firm hope that said technical assistance will be established in the very near future.

The Committee's recommendations

1. 1052. In the light of its foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) As to the allegations regarding Act No. 29 of 8 June 2010, establishing a special regime for the area of Barú, which includes a provision allowing enterprises to operate for the first six years without undertaking bargaining processes concerning collective labour agreements (section 7 of the Act), the Committee urges the Government to take the necessary measures to repeal the abovementioned section 7 without delay. Furthermore, noting that the Government has not responded to the allegation made by the complainants with regards to said Act, according to which, the representatives of the workers’ central CONATO and the employers’ central CONEP are not represented on the Administration Committee of the Special Economic Area of Barú, the Committee recalls the importance of consultation with the most representative employers’ and workers’ organizations with regards labour issues, requests the Government to consider, together with those organizations, the possibility of the latter being represented on the Administration Committee, in order that they might be consulted on issues affecting their members, and to keep it informed in this regard.
   • (b) As to the allegations regarding a Manual of Procedures for the Department of Social Organizations (ministerial ruling of 15 December 2009), which according to the complainants restricts the exercise of trade union rights, the Committee notes that the text of the Manual (copy provided by the Government) does not seem to have been subject to consultations with the most representative trade union organizations. Rather, it is claimed that the Manual consists of a series of flexible procedures aimed at speeding up the administrative process and the Government is ready to consider any recommendations that might arise from its application. The Committee finds that certain terms employed in the Manual, such as the “approval” of executive committees, may give rise to problems of interpretation and requests the Government to examine said Manual with the most representative workers’ organizations in order to clear up any misunderstandings and produce a text which enjoys as much support as possible.
   • (c) As to the alleged increase of the minimum number of public servants needed to establish a trade union association in the public sector (50 servants) in the light of Act No. 43, the Committee requests the Government to take measures to amend Act No. 43 in order to reduce the minimum number of public servants necessary to establish a trade union association, given that an excessively high minimum number could restrict trade union rights, in particular in certain public institutions and small municipalities. As to the allegation that, in the light of Act No. 43 of 2009, public servants dismissed unfairly and then reinstated through a ruling do not have the right to receive the lost wages for the period between the moment of separation and that of reinstatement, the Committee notes the Government’s statement that this allegation is groundless and notes that the Government backs up this claim by referring to two Supreme Court rulings obliging the State to pay the wages and other benefits. The Committee notes that the Government only sent one of the rulings, dated 17 February 2006, when, in fact, Act No. 43 was adopted in 2009. The Committee would therefore be grateful if the Government would send other rulings supporting its statement.
   • (d) As to the allegations regarding the public servants’ organization FENASEP i.e. refusal by the authorities to recognize FENASEP in practice, despite the fact that FENASEP representatives have participated in the ILC as delegates on several occasions, exclusion of representatives of this organization from the Technical Committee and the Appeal and Conciliation Committee in the light of Act No. 43 of 30 July 2009, denial of education insurance funds (trade union training) previously enjoyed by FENASEP – (despite the fact that all public servants have 1.25 per cent deducted from their salaries for the education insurance, thus discriminating between trade union associations of public servants and private sector trade unions), the Committee requests the Government to initiate a constructive dialogue with FENASEP in order to find a solution to the problems which will avoid any risk of discrimination against the organization while allowing it to be recognized for all purposes in connection with its representativeness.
   • (e) As to the allegation that the Ministry of Labour has frozen 30 requests for trade union registration over the past ten months, the Committee requests the Government to indicate those trade unions which have not been registered despite the fact that they have submitted applications for registration and to communicate the reasoned administrative rulings behind the non-registration of trade union organizations.
   • (f) As to the dismissal of Mr Víctor C. Castillo Díaz (according to the allegations, the General Secretary of the Association of Employees of ASEMITRABS) in violation of Act No. 43 on the protection of trade union leaders (trade union immunity), the Committee request the Government to communicate the result of the appeal lodged against the dismissal of Mr Víctor C. Castillo Díaz and, given that the Government disputes his appointment as Secretary General and even the existence of his association of public employees (despite the fact that the complainant organizations have sent a public instrument drawn up by a solicitor which vouches for ASEMITRABS’ establishment and executive committee), to indicate whether said association has applied for registration and legal personality and, should that be the case, to indicate the reasons why that application was unsuccessful.
   • (g) The Committee requests the Government to send it copies of any rulings or charges brought by the Public Ministry against trade union leaders for illicit diversion of public education insurance funds earmarked for trade union training.
   • (h) Finally, the Committee notes that the Government has been examining the possibility of establishing a higher labour council as a consultative body in order to promote social dialogue concerning labour issues with the technical support of the ILO, and that it has formally requested ILO technical assistance in harmonizing national legislation and practice with the provisions of Conventions Nos 87 and 98 (the Government highlights that request in the part of this document regarding the allegations affecting FENASEP). The Committee expresses the firm hope that said technical assistance will be established in the very near future.