Observation (CEACR) - adopted 2008, published 98th ILC session (2009)

Right to Organise and Collective Bargaining Convention, 1949 (No. 98) - Nepal (Ratification: 1996)

The Committee notes with interest from the Government’s report and the comments made by the International Trade Union Confederation (ITUC) in a communication dated 29 August 2008, that the Interim Constitution which entered into force in 2007 guarantees in Articles 12 and 30 the right to organize and engage in collective bargaining. Moreover, the Civil Service Ordinance Act which previously revoked the right of public servants to form and belong to trade unions, has been amended by the Civil Service Act thus restoring the right of public employees (up to Gazetted Third Class) to organize and bargain collectively. The Committee requests the Government to specify the categories of public employees included in the gazetted and non-gazetted classes and which ones are covered by the legislative recognition of the right to organize and engage in collective bargaining.

The Committee also takes note of the National Directive Act, 1962 and the Civil Service Act communicated by the Government. The Committee will comment on them once a translation is available. Finally, the Committee takes note of the draft National Labour Commission Act drafted by a national tripartite task force on the basis of widespread consultations, in order to address shortcomings in the system of grievance and dispute resolution. The Committee raises certain issues in relation to this draft Act below.

Article 1 of the Convention. Anti-union discrimination. The Committee’s previous comments concerned the need for provisions providing explicit protection against acts of anti-union discrimination, accompanied by effective and sufficiently dissuasive sanctions. The Committee notes from the Government’s report that based on the constitutional provision concerning discrimination and section 23(a) of the Trade Union Act, 1992, which explicitly discourages anti-union discrimination in respect of employment, there have hardly been any acts of anti-union discrimination brought to the notice of the authorities. However, maximum protection will be explicitly ensured through the upcoming labour market reform and the revision of the related laws by the tripartite task force. The Committee requests the Government to indicate in its next report the measures taken or contemplated in order to introduce in legislation: (i) an explicit prohibition of all prejudicial acts committed against workers by reason of their trade union membership or participation in trade union activities at the time of recruitment, during employment or at the time of dismissal (e.g. transfers, demotions, refusal of training, dismissals, etc.); and (ii) effective and sufficiently dissuasive sanctions in cases of violation of this prohibition.

Article 2. Acts of interference. The Committee’s previous comments concerned the need to ensure the enactment of a provision providing protection to workers’ and employers’ organizations against acts of interference by one another, and including effective and sufficiently dissuasive sanctions guaranteeing adequate protection to trade unions against acts of interference in their establishment, functioning or administration and, in particular, against acts which are designed to promote the establishment of workers’ organizations under the domination of employers’ organizations, or to support workers’ organizations by financial or other means, with the objective of placing such organizations under the control of employers or employers’ organizations. The Committee notes from the Government’s report that interference is hardly practised in Nepal although there is no explicit provision against such activities in the legislation. The issue shall be addressed in the course of the labour market reform. The Committee requests the Government to indicate in its next report the measures taken or contemplated in order to introduce in the legislation a prohibition of acts of interference as well as rapid appeal procedures and dissuasive sanctions against such acts.

Article 4. Collective bargaining. 1. Compulsory arbitration. The Committee notes that according to section 9(4) of the draft National Labour Commission Act, this National Labour Commission will have the power, in applying the Essential Services Act, 1957 and section 30 of the Trade Union Act, to arbitrate interests disputes in the hotel and transportation sectors as well as in cases where the authorities consider that the economic development of the country so requires. The Committee recalls that compulsory arbitration imposed either at the request of one party to a dispute or by the authorities at their own initiative, raises problems with regard to the application of Article 4 of the Convention (General Survey of 1994 on freedom of association and collective bargaining, paragraphs 256–258). The Committee therefore requests the Government to indicate in its next report the measures taken to address the set of provisions noted above in the context of labour market reform so as to ensure that compulsory arbitration is not imposed at the initiative of one party to an interests dispute in the hotel and transportation sectors or at the initiative of the authorities where they consider that the country’s economic development so requires; compulsory arbitration would only be acceptable in essential services in the strict sense of the term and for public servants exercising authority in the name of the State.

2. Composition of arbitration bodies. The Committee notes that section 6 of the draft National Labour Commission Act provides that the Appointment Committee responsible for determining the composition of the National Labour Commission shall consist, inter alia, of two persons duly nominated by the Federation of Nepal Chamber of Commerce and Industry. The Committee considers that any decisions concerning the participation of workers’ and employers’ organizations in a tripartite body – especially one entrusted with mediation, conciliation and arbitration proceedings – should be taken in full consultation with all the organizations whose representativity has been objectively proved. The Committee considers, thus, that the members of the Appointment Committee should not be determined by reference to a specific organization by name, but rather to the “most representative” organization. The Committee therefore requests the Government to avoid any reference to the Federation of Nepal Chamber of Commerce and Industry or any other organization in the draft National Labour Commission Act, and to refer rather to the “most representative” employers’ organization.

3. Measures to promote collective bargaining. In its previous comments, the Committee had noted that according to the ITUC, although the Labour Act provides for collective bargaining, the necessary structure for the implementation of the provisions is not in place. The Committee notes that in its latest comments of August 2008, the ITUC indicates that owing to a combination of worker inexperience and employer reluctance, there is, in fact, little collective bargaining and the related agreements only cover around 10 per cent of workers in the formal economy. The Committee notes from the Government’s report that strategy No. 3.2.6 of the Labour and Employment Policy 2062 states that collective bargaining (which now includes 155 collective agreements at the level of plants and eight at national level) will be encouraged through legal and institutional provisions and by building an environment conducive to the organization of workers and employers in the informal economy. The Committee requests the Government to indicate in its next report the impact of these measures as well as any further measures taken to promote collective bargaining and to provide statistical data on the scope of the collective agreements which have already been concluded.