Report in which the committee requests to be kept informed of development - Report No 367, March 2013

Case No 2915 (Peru) - Complaint date: 11-NOV-11 - Closed

Allegations: Dismissals of trade unionists at the Agroindustrias San Jacinto SA company and San Marcos Higher National University

1. 1104. The complaint is contained in a communication from the General Confederation of Workers of Peru (CGTP) dated 11 November 2011. This organization sent additional information and new allegations in communications dated 10 and 23 January and 21 February 2012.
2. 1105. The Government sent its observations in communications dated 21 March and 28 August 2012 and 14 January 2013.
3. 1106. Peru has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), the Right to Organise and Collective Bargaining Convention, 1949 (No. 98), the Labour Relations (Public Service) Convention, 1978 (No. 151), and the Collective Bargaining Convention, 1981 (No. 154).

A. The complainant’s allegations

1. 1107. In its communications dated 11 November 2011 and 10 and 23 January and 21 February 2012, the General Confederation of Workers of Peru (CGTP) alleges that Agroindustrias San Jacinto SA, a sugar-producing company from Santa province, arbitrarily dismissed Mr Modesto Sáenz Diestra, general secretary of the Union of Employees of Agroindustrias San Jacinto SA, and Mr Pedro Gutiérrez Ramírez, general secretary of the Single Union of Workers of Agroindustrias San Jacinto SA, for defending the rights of the workers. The CGTP points out that the company cited non-existent serious misconduct in both cases.
2. 1108. The CGTP further alleges that on 3 October 2011 the San Marcos Higher National University failed to renew the contract of Ms Luisa Ormeño Espino, training secretary of the San Marcos Higher National University Workers’ Union (SITRAUSM), who had accumulated 16 years of service at the university. The membership of the aforementioned union consists largely of workers employed on service contracts (i.e. temporary contracts in public institutions, renewable on a discretionary basis and without restriction during each budget year, which in practice allows the non-renewal of contracts on anti-union grounds). In addition, on 3 October 2011, contracts were not renewed for seven workers who were union members, namely Ms Lucy Marisol Salcedo Aranda, Mr Mario Humberto Figueroa Girao, Ms María Eugenia Chukiwamka Yapuras, Mr Gaudencio Marcos Yallicuna Dávila, Ms Doris Elizabeth Silva Azañedo, Mr Juan Alberto Florián Oyarce, Mr José Manuel Palacín Espinoza and Ms Rut Margarita Santana Muñoz. Furthermore, after nine years’ service at the university, Mr William Manuel Vilca Mendoza (the union’s deputy social assistance secretary) did not have his contract renewed.
3. 1109. The CGTP also alleges that the abovementioned university refuses to grant trade union leave to SITRAUSM officials (despite doing so for the other three unions), has not transferred to the union its membership dues – which are deducted at source – for October 2011 and has not checked off the union dues for November and December 2012 despite authorization to do so from the union members.
4. 1110. Lastly, the CGTP alleges that the university refuses to negotiate with SITRAUSM regarding the list of demands submitted by the union on 12 September 2012.

B. The Government’s reply

1. 1111. In its communications dated 21 March and 28 August 2012 and 14 January 2013, the Government states in relation to the dismissal of Mr Hernando Modesto Sáenz Diestra by Agroindustrias San Jacinto SA that on 10 April 2012 the Sixth Labour Division of the Higher Court of Justice of Santa issued a ruling stating that, faced with the claim of the union official concerned that his dismissal was an anti-union reprisal, the company filed a claim of serious misconduct for defamation and abuse against the company’s representatives. The misconduct was recognized in first instance proceedings conducted by the magistrate in San Jacinto. In the ruling (a copy of which has been sent by the Government) the judicial authority points out that since the union official concerned has received severance pay, he has thereby accepted the alternative legal remedy to reinstatement. It therefore declares the complaint filed by Mr Hernando Modesto Sáenz Diestra to be unfounded.
2. 1112. As regards the dismissal of union official Mr Pedro Gutiérrez Ramírez, the Government states that the lawsuit filed by this official was dismissed.
3. 1113. As regards the system of administrative service contracts (CAS) and the allegations concerning San Marcos Higher National University, the Government indicates that Legislative Decree No. 1057 was adopted to regulate a special system of private state contracts which was not subject to the Administrative Career Framework Act, the labour regulations governing private activity or any other provisions regulating special administrative careers. The purpose of the Decree was to deal with the situation which had been occurring in recent years in various branches of the public administration, involving the widespread use of certain types of contract which did not guarantee entry to the public administration and respect for the principles of equality of opportunities, merit and ability, and also did not recognize minimum labour rights. Recognition was sought for fundamental rights, such as access to social security, as established in the Political Constitution and in international instruments. The Decree established a system of contracts which would be fixed-term, renewable and comprise the following rights: (a) a maximum 48-hour working week; (b) a weekly rest period of 24 consecutive hours; (c) 15 consecutive days’ leave for a complete year of service; (d) affiliation to the ESSALUD contributory social security scheme; and (e) affiliation to a pension scheme.
4. 1114. The Government adds that on 31 August 2010 the Constitutional Court issued a ruling in the case requesting a declaration of unconstitutionality filed by more than 5,000 citizens against the Executive Authority. The Court recognized the labour status of the CAS system, declaring it to be compatible with the constitutional framework, recognizing it as a system of employment contracts replacing the civil system of service provider contracts and separate from existing schemes. The Court also found that there was a constitutional omission in the provisions concerning the right to organize and the right to strike, and this had to be rectified by the labour administrative authority in accordance with article 28 of the Political Constitution of Peru. The Constitutional Court considered that declaring the Decree unconstitutional would create a legal vacuum which would leave those contracted under this scheme devoid of labour rights. It therefore decided that on the basis of the ruling the Decree should be interpreted and understood as a “special” system of labour contracts for the public sector, which was compatible with the constitutional framework. Further to the abovementioned ruling, Supreme Decree No. 065-2011-PMC of 26 July 2011 established amendments to the regulations governing administrative service contracts in order to align the system to the ruling of the Constitutional Court, thereby rectifying the constitutional omission. The right to organize was thus granted to the workers under this system, allowing them to form trade unions and join the public service trade unions which already exist in the institution in which they provide services. Trade union organizations are regulated by Act No. 27556, which establishes the register of public service trade unions; it also grants them the right to strike, which must be exercised in accordance with the consolidated text of Legislative Decree No. 25593 (Collective Labour Relations Act). In addition, Act No. 29849 of 6 April 2012 provides for the gradual phasing-out of the special system established by Legislative Decree No. 1057 and grants various labour rights. The object of this Act is to gradually phase out this system from 2013 onwards in conjunction with the implementation of the new civil service regime, whereby institutions must establish percentages for entry as part of the annual budget regulations for the public sector. The aforementioned Act guarantees, inter alia, the following labour rights: pay not lower than the legal minimum wage; maximum working time of eight hours per day or 48 hours per week; weekly rest period of 24 consecutive hours; refreshment breaks which are not included in the working day; bonus for the national holiday and Christmas; 30 calendar days’ paid holidays; paid maternity/paternity leave; freedom of association; affiliation to a pension scheme; affiliation to the ESSALUD health scheme; and employment certificates. Grounds for termination of the contract include: resignation, mutual consent and expiry of the contract period.
5. 1115. The Government indicates that with the promulgation of Act No. 29849 existing complaints relating to workers subject to the special system of administrative service contracts have been settled, since the new system establishes labour rights in the context of a temporary labour regime, while the new civil service regime is being put in place.
6. 1116. As regards the non-renewal of the contracts of three officials of the SITRAUSM (Ms Luisa Ormeño Espino, Mr Daniel Jorge Trujillo Huamani and Mr William Manuel Vilca Mendoza) and of seven union members (Ms Lucy Marisol Salcedo Aranda, Mr Mario Humberto Figueroa Girao, Ms María Eugenia Chukiwamka Yapuras, Mr Gaudencio Marcos Yallicuna Dávila, Ms Doris Elizabeth Silva Azañedo, Mr Juan Alberto Florián Oyarce, Mr José Manuel Palacín Espinoza and Ms Rut Margarita Santana Muñoz), the Government states that the university is a public institution and is therefore authorized to conclude contracts with its staff according to the special system of administrative service contracts. There has been no failure by the university to meet any legal obligation with respect to former contract employees since it is not obliged to renew a contract once it has expired, and this has been the situation regarding the abovementioned workers. To see the abovementioned situation in terms of a violation of freedom of association is unjustified since the fact of being a union member or union official under contract does not imply that the university is unable to terminate the contract, in view of the nature of administrative service contracts. Accordingly, the Constitutional Court of Peru, the highest constitutional authority in the country, has stated in the ruling handed down in Case No. 2626-2010-PA/TC that the system of substantive protection against arbitrary dismissal provided for under the special system of administrative service contracts is in conformity with article 27 of the Constitution. It also established that the duration of an administrative service contract, in accordance with section 5 of Supreme Decree No. 075-2008-PCM, cannot exceed the period corresponding to the fiscal year within which the contract is concluded; its duration is therefore for a fixed term and any administrative action to the contrary would be illegal. Consequently, it stated that should the employment relationship be ended without any of the grounds for termination of the administrative service contract being present, the person concerned will be entitled to receive the compensation provided for in clause 13.3 of Supreme Decree No. 075-2008-PCM. In conclusion, it states that this is a special, transitory system of employment whose purpose is to initiate the process of reform and restructuring of the civil service, and for this reason any claim for reinstatement shall be deemed to have no basis.
7. 1117. The Government indicates that in the cases of the workers at San Marcos Higher National University there have been no arbitrary dismissals since administrative service contracts have a fixed duration and when they expire the employer has no obligation to renew them.
8. 1118. The Government states that to see the abovementioned situation in terms of a violation of freedom of association is unjustified since the fact of being a union member or union official under contract does not imply that the university is unable to terminate the contract, in view of the nature of administrative service contracts. Accordingly, the Constitutional Court of Peru, the highest constitutional authority in the country, has stated that the system of substantive protection against arbitrary dismissal provided for under the special system of administrative service contracts is in conformity with article 27 of the Constitution; the duration of an administrative service contract is solely for a fixed term and any administrative action to the contrary would be illegal. Should the employment relationship be ended without any of the grounds for termination of the administrative service contract being present, the person concerned will be entitled to receive compensation. This is a special, transitory system of employment whose purpose is to initiate the process of reform and restructuring of the civil service, and for this reason any claim for reinstatement shall be deemed to have no basis.
9. 1119. In the light of all the foregoing, the Government requests that the present complaint be dismissed.

C. The Committee’s conclusions

1. 1120. As regards the dismissal of two trade union officials by the Agroindustrias San Jacinto SA company, the Committee notes the second instance ruling sent by the Government declaring the complaint filed by union official Mr Hernando Modesto Sáenz Diestra to be unfounded after observing that the first instance court recognized the existence of serious misconduct for defamation and abuse against the company’s representatives and indicating that since the union official concerned has received severance pay, he has thereby accepted an alternative legal remedy to reinstatement. The second instance court therefore declared the complaint filed by Mr Hernando Modesto Sáenz Diestra to be unfounded. As regards the dismissal of union official Mr Pedro Gutiérrez Ramírez, the Committee notes the Government’s statement that the lawsuit filed by this official was dismissed by the judicial authority and that the ruling is final.
2. 1121. As regards the alleged negative impact of administrative service contracts on trade union rights since they involve a system of temporary contracts in public institutions which are renewable on a discretionary basis, the Committee notes the Government’s statements that the Constitutional Court stated in a ruling of 31 August 2010 that there was an omission in this system regarding the right to organize and the right to strike which needed to be rectified; consequently Legislative Decree No. 1057 was amended by Supreme Decree No. 065-2011-PMC and Act No. 29849 of 6 April 2012, which grant trade union rights to employees who are subject to the administrative service contract system and also other labour rights, while also providing for the gradual phasing-out of the said system. The Committee observes that it previously noted this positive development with satisfaction [see 365th Report, Case No. 2757, paragraph 156].
3. 1122. As regards the non-renewal of administrative service contracts for three officials of the SITRAUSM, namely Ms Luisa Ormeño Espino, Mr Daniel Jorge Trujillo Huamani and Mr William Manuel Vilca Mendoza, and the dismissal of seven union members whose names appear in the complainant’s allegations and the Government’s reply, the Committee notes the Government’s statements that the university has not failed to meet any legal obligation since it is not obliged to renew a contract once it has expired and that the fact of being a union member or union official does not imply that the university is unable to terminate the contract, in view of the nature of administrative service contracts (i.e. for a fixed period which cannot exceed the period corresponding to the fiscal (budgetary) year within which the contract is concluded; in the event of non-renewal of the contract, the person concerned is legally entitled to compensation, as indicated by the ruling of the Constitutional Court of Peru in relation to this system of contracts, which is temporary), so that the employer has no obligation to renew the contract.
4. 1123. While noting the Government’s explanations, which deal with the nature of temporary contracts in general, the Committee emphasizes, firstly, that non-renewal of the contract of a trade union official or member may, according to the circumstances, have an anti-union motive or purpose which is incompatible with Conventions Nos 98 and 151, which have been ratified by Peru, and, secondly, that two union officials had allegedly been working at the university for 16 years (Ms Luisa Ormeño Espino) and nine years (Mr William Manuel Vilca Mendoza), respectively. The Government also refers to the non-renewal of the contract of another union official (Mr Jorge Trujillo Huamani) and acknowledges the non-renewal of the contracts of the seven union members referred to by name by the complainant organization.
5. 1124. Under these circumstances, the Committee requests the Government to conduct an inquiry into the grounds for non-renewal of the contracts of the three union officials and seven union members referred to above so that it can determine whether or not the university committed acts of anti-union discrimination. The Committee requests the Government to keep it informed in this regard.
6. 1125. As regards the alleged violation of freedom of association by the university in not granting trade union leave to officials of SITRAUSM, not transferring the amount of union dues corresponding to October 2011 to the financial secretary’s office and not checking off the union dues for November or December 2011, and also the alleged violation of the right to collective bargaining in refusing to engage in collective negotiation with SITRAUSM, the Committee observes that the Government, despite the fact that the allegations are subsequent to the ruling of the Constitutional Court recognizing trade union rights for workers employed on administrative service contracts, has not supplied any specific information in this regard and requests it to conduct an inquiry and keep it informed of the outcome.

The Committee’s recommendations

1. 1126. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) As regards the non-renewal of the administrative service contracts of three officials and seven members of SITRAUSM, the Committee requests the Government to conduct an inquiry into the grounds for non-renewal of the contracts so that it can determine whether or not San Marcos Higher National University, a public institution, committed acts of anti-union discrimination. The Committee requests the Government to keep it informed in this regard.
   • (b) The Committee requests the Government to conduct an inquiry into the allegations of refusal to grant trade union leave to officials of SITRAUSM and refusal to pay or check off the union dues of the aforementioned organization, and also into the alleged refusal by the university to engage in collective bargaining with the aforementioned union.