Minimum Wage-Fixing Machinery Convention, 1928 (No. 26) - Peru (Ratification: 1962)

Direct Request (CEACR) - adopted 2023, published 112nd ILC session (2024)

Previous comment

In order to provide a comprehensive view of the issues relating to the application of ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 26 and 99 (minimum wages) in the same comment.

The Committee notes the observations of the National Confederation of Private Business Institutions (CONFIEP), received on 31 August 2023, and the observations of the Autonomous Workers’ Confederation of Peru (CATP), received on 1 September 2023.

Legislation. The Committee notes that the Government refers in its report to the promulgation of Act No. 31110 on labour regulations in agriculture and incentives for the agriculture/irrigation, agri-export and agro-industrial sector, published on 31 December 2020, and its implementing regulations (Supreme Decree No. 005-2021-MIDAGRI, published on 30 March 2021).

Article 2 of Convention No. 99. Partial payment of minimum wages in kind. Further to its previous comments, the Committee notes the Government’s indication that in agriculture neither Act No. 31110 nor its Regulations establish particular provisions regarding the payment of wages in kind. The Government indicates that the general labour regulations on private activity are therefore applicable, in particular the Act on labour productivity and competitiveness, adopted by Supreme Decree No. 003-97-TR, and the single consolidated text of the Act on compensation for service time, adopted by Supreme Decree No. 001-97-TR. In this regard, the Committee notes the Government’s indication that sections 9, 13, 14 and 15 of the single consolidated text of the Act on compensation for service time establish guidelines relating to payment in kind. In particular, the Government refers to section 15, which stipulates that payment of remuneration in kind must stem from an agreement and the value shall be established by joint agreement or otherwise by the market value, and it indicates that the purpose of this is to avoid attaching an excessive value to benefits in kind, which ends up affecting workers’ income. In relation to its previous comments, the Committee notes that CONFIEP indicates that section 11 of Decree-Law No. 14222, on the valuation of remuneration in kind, was tacitly repealed by section 15 of the single consolidated text of the Act on compensation for service time. In this regard, the union indicates that none of these standards establishes limits on payment of wages in kind but merely establish rules for adequate valuation. CONFIEP adds that if wages in kind are determined by an agreement of the parties, such an agreement must be reasonable and take account of normal market prices, and over-valuation of wages in kind would entitle workers to make a judicial appeal to have the agreement established at the value in question declared null and void. The Committee requests the Government to provide information on the measures taken or envisaged to ensure that the payment of wages in kind, specifically in agriculture, is only partial and that: (i) allowances in kind are appropriate for the personal use and benefit of the worker and his family; and (ii) the value attributed to such allowances is fair and reasonable.

Article 3(1) and (2) of Convention No. 26 and Article 3(1), (2) and (3) of Convention No. 99. Minimum wage-fixing machinery.Participation of the social partners. Further to its previous comments, the Committee notes the Government’s indication that a minimum wage currently exists for all private labour activity and that the National Labour and Employment Promotion Council (CNTPE), through its Special Committee on Productivity and Minimum Wages, is the forum for dialogue on this matter. The Committee also notes the Government’s indication that the participation of agricultural workers in the CNTPE is manifested through the trade union confederations which make up the dialogue forum. The Committee further notes CONFIEP’s indication that the increase in the minimum wage was never a subject of consultation with workers and employers. The Committee also notes that the CATP in its observations expresses concern at the lack of institutionalization of the review of the minimum wage. In particular, the CATP indicates that there is no official mechanism adopted by law or decree of the executive authority relating to the fixing or periodic adjustment of the minimum wage. The Committee requests the Government to provide its comments with respect to the observations of CONFIEP and the CATP.

Article 4 of Conventions Nos 26 and 99. System of supervision and sanctions. The Committee notes the Government’s indication that, according to the information provided by National Labour Inspection Authority (SUNAFIL), in 2022 and 2023 there was a total of 2,763 concluded inspection orders relating to the minimum living wage (2,198 in 2022). The Government also indicates that 15,743 workers were affected by these orders (13,292 in 2022). As regards decisions and fines relating to the minimum living wage, the Committee notes the Government’s indication that in 2022 a total of 51 decisions were issued (19 at first instance, 32 at second instance) while from January to June 2023 the figure was 28 (19 at first instance, 9 at second instance). As regards fines, the total amount in 2022 was 452,466 Peruvian soles (PEN) (308,378 at first instance, 144,088 at second instance), while up to June 2023 it was PEN 194,046 (149,188 at first instance, 44,858 at second instance). The Committee notes that the CATP in its observations expresses concern at the scarcity of labour inspection relating to the minimum wage. It also indicates that cases are frequently reported in which employers formally record payment of the minimum wage on the payroll but in practice pay workers smaller amounts. The Committee requests the Government to provide its comments in this respect. The Committee also refers to its comments on the application of the Labour Inspection Convention, 1947 (No. 81).

Direct Request (CEACR) - adopted 2019, published 109th ILC session (2021)

In order to provide a comprehensive view of the issues relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 26 and 99 together. The Committee notes the observations of the Autonomous Workers’ Confederation of Peru (CATP) on the application of Conventions Nos 26 and 99, received in 2017, and the Government’s reply to these observations.

Article 2 of Convention No. 99. Partial payment of minimum wages in kind. In its previous comments, the Committee noted the Government’s indication that the conditions for the payment of wages in the form of allowances in kind and their limits were regulated by Legislative Decree No. 14222 of 1962 and its Regulations (Presidential Decree No. 007) of 1965. In particular, the payment of wages in kind was regulated by sections 10, 11 and 13 of Legislative Decree No. 14222. In this regard, the Committee notes the information available on the webpage of the Peruvian Legal Information System of the Ministry of Justice and Human Rights, according to which Decision No. 582-2013-MTPE-4, of 5 March 2013, of the Ministry of Labour and Employment Promotion, indicates that sections 10 and 13 of Legislative Decree No. 14222 have been tacitly repealed in line with sections 1 and 2 of Act No. 28051 respecting food allowances for workers subject to the private sector labour regime of 2003. The Committee understands that section 11 of Legislative Decree No. 14222 has not been repealed. The Committee requests the Government to confirm whether section 11 of Legislative Decree No. 14222 and its regulations continue to cover the partial payment of wages in kind and, if so, to provide information on the application of assessment criteria and limits to such payments in practice, and particularly in relation to the payment of minimum wages to workers in the agricultural sector.

Article 3(1) and 2(1) and (2), of Convention No. 26, and Article 3(1), (2) and (3) of Convention No. 99. Minimum wage-fixing machinery. Participation of the social partners. With reference to its previous comments, the Committee notes the Government’s replies in its report to the observations of the General Confederation of Workers of Peru (CGPT) and the information provided on the General Labour Bill. The Committee also notes the indication by the CATP in its observations that workers in the agricultural sector are not consulted in relation to their minimum wage and that the special labour regime applicable to the sector has not been taken into account in the National Labour and Employment Promotion Council (CNTPE). Moreover, it refers to the suspension of the work of the CNTPE. The Committee requests the Government to provide information on the manner in which workers in the agricultural sector are consulted on or participate in the CNTPE with a view to the determination or application of the minimum wage-fixing machinery covering the sector. Furthermore, taking into account the fact that the operation of the CNTPE is under examination in the framework of the Tripartite Consultation (International Labour Standards) Convention, 1976 (No. 144), the Committee refers to its comments on the application of that Convention.

Article 4 of both Conventions. Supervision and sanctions. The Committee notes the indication by the CATP in its observations that the labour inspection system is confronted with operational problems, particularly in relation to micro-enterprises, as a consequence of the shortage of human, financial and material resources, as well as the reduction in the penalties in place for failure to comply with the social and labour provisions applicable to such enterprises, including in relation to the minimum wage. The Committee requests the Government to provide updated information on the labour inspections undertaken in relation to the payment of the minimum wage, including the number of inspections conducted, the number of workers involved, the violations detected and the penalties imposed. The Committee also refers to its comments on the application of the Labour Inspection Convention, 1947 (No. 81).

Direct Request (CEACR) - adopted 2012, published 102nd ILC session (2013)

Articles 1 and 3(2) of the Convention. Minimum wage fixing machinery and consultation with social partners. Further to its previous comments, the Committee notes the Government’s information that since 2007, the national minimum wage is regularly revised based on two main technical indicators – projected inflation and multifactor productivity – established by the tripartite National Council for Labour and Employment Promotion (CNTPE). The Committee understands that the draft General Labour Law, which is currently under preparation, sets out in section 203 the role and function of the CNTPE in the minimum wage fixing process without however specifying the criteria to be taken into consideration in determining minimum wage levels. The Committee requests the Government to keep the Office informed of any further developments concerning the elaboration of the minimum wage provisions of the draft General Labour Law and recalls, in this connection, that the Minimum Wage Fixing Convention, 1970 (No. 131) – that the Government is strongly encouraged to ratify – contains specific guidance on the socio-economic factors to be used in fixing and adjusting minimum wages.

In addition, the Committee notes the comments of the General Confederation of Workers of Peru (CGTP) received on 8 October 2012 and transmitted to the Government on 12 October 2012 according to which the national minimum wage is the second lowest among Latin American countries. The CGTP refers to a tendency of progressive erosion of the purchasing power of the minimum wage which currently covers only 72 per cent of the basic family basket, calculated on the basis of four family members and a monthly cost of 260 Peruvian nuevos soles (PEN) (approximately US$100) per person. The CGTP points out the importance of implementing policies that seek to improve the purchasing power of workers’ earnings but also promote collective bargaining for fixing wage levels. The CGTP also considers that there can be no progress towards social justice unless a better synergy is established between the institutions responsible for developing macro-economic policies and those responsible for social policies, in the framework of a constructive dialogue with workers’ and employers’ organizations. Such dialogue should render it possible to create a more equitable relationship between labour productivity and wages. The Committee requests the Government to provide any comments it may wish to make in response to the observations of the CGTP.

Article 5 and Part V of the report form. Application in practice. The Committee notes that the national minimum wage was last increased by Supreme Decree No. 007-2012-TR and is presently set at PEN750 (approximately $290) per month. It also notes the Government’s information that in Peru there are on average two wage earners per family, permitting them to cover the monthly basic basket of essential consumer goods estimated at PEN1,382 (approximately $530). The Government indicates that, according to the National Household Survey (ENAHO), between 2004 and 2010, the percentage of the workforce that received wages equal or higher than the minimum wage increased from 61 to 70 per cent. Finally, the Committee notes the statistical information on inspection results and the Government’s indication on the supervision of compliance with the minimum wage legislation through the system of electronic payroll developed by the National Superintendence of Tax Administration. The Committee requests the Government to continue to provide up-to-date information on the practical application of the Convention.

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

Article 1 and Article 3(2) of the Convention. Minimum wage fixing machinery and consultation with social partners. The Committee notes the Government’s explanations on the role and function of the tripartite National Council for Labour and Employment Promotion (CNTPE) in determining minimum wage levels, in accordance with section 13 of Act No. 27711, as amended by Act No. 28318, and section 2 of Supreme Decree No. 001-2005-TR. It notes, in particular, that, following the 2005 report of a governmental technical committee on the revision of the minimum wage and the formulation of relevant proposals by employers’ and workers’ organizations in 2006, CNTPE has recommended the use of inflation and productivity as the two main indicators for the periodic review of the national minimum wage but stressed the need to enhance the quality and accuracy of those indicators. The CNTPE has also decided to continue to work on setting up a reliable and predictable mechanism for the readjustment of the minimum wage and, in this connection, has established a joint special committee to examine possible methods for improving data collection on productivity. The Committee requests the Government to continue to provide information on the ongoing consultations for possible ameliorations in the minimum wage fixing process and to transmit copies of any relevant legal text that might be adopted as a result.

Article 4. System of supervision and sanctions. Further to its previous comment concerning the enforcement of minimum wage legislation, the Committee notes that the Government is still not in a position to provide any concrete figures on inspection results showing the number of violations of the provisions on minimum wages observed and the sanctions imposed. The Committee trusts that the Government will make every effort to strengthen supervision and ensure compliance with the national minimum wage and hopes that the Government will supply information in its next report on the progress achieved in this regard.

Article 5 and Part V of the report form. The Committee notes that the national minimum wage was last increased by Supreme Decree No. 022-2007-TR and is presently set at 550 soles (approximately US$193) per month. The Committee would appreciate if the Government would give some indication as to whether the current level of the minimum wage is adequate to ensure a decent standard of living to workers and their families, especially as regards its purchasing power by reference to a basic basket of essential consumer goods. It would also be grateful if the Government would continue to provide up to date information on the effect given to the Convention in practice, including, for instance, statistical information on the evolution of minimum pay rates as compared to the evolution of economic indicators such as the consumer price index in recent years, the approximate number of workers remunerated at the minimum pay rate (if possible broken down by sex and age) extracts from official studies or reports on minimum wage policy, etc.

Finally, the Committee wishes to draw the Government’s attention to the conclusions of the ILO Governing Body as regards the relevance of the Convention following the recommendations of the Working Party on Policy regarding the Revision of Standards (GB.283/LILS/WP/PRS/1/2, paragraphs 19 and 40). In fact, the Governing Body has decided that Convention No. 26 is among those instruments which may no longer be fully up to date but remain relevant in certain respects. The Committee therefore suggests that the Government should consider the possibility of ratifying the Minimum Wage Fixing Convention, 1970 (No. 131), which contains certain improvements compared to older instruments on minimum wage fixing, for instance, as regards its broader scope of application, the requirement for a comprehensive minimum wage system, and the enumeration of the criteria for the determination of minimum wage levels. The Committee considers that the ratification of Convention No. 131 is all the more advisable as Peru has already a statutory minimum wage of general application (and not only minimum wages for those workers employed in exceptionally low-paid trades where no arrangements for collectively negotiated wages exist, as prescribed by Convention No. 26) and its legislation appears to broadly reflect the requirements of that Convention. The Committee requests the Government to keep the Office informed of any decision taken or envisaged in this regard.

Direct Request (CEACR) - adopted 2007, published 97th ILC session (2008)

The Committee notes that the information supplied by the Government on the impact that the earthquake which took place last August in its country has had on its capacity to submit its reports. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous comments regarding minimum wage-fixing under Conventions Nos 26 and 99.

Direct Request (CEACR) - adopted 2003, published 92nd ILC session (2004)

See the comments under Convention No. 99.

Direct Request (CEACR) - adopted 1998, published 87th ILC session (1999)

The Committee notes the information provided in the Government's report.

Articles 1 and 3 of the Convention. The Committee notes that article 24 of the Political Constitution of Peru of 29 December 1993 provides for the regulation of minimum wages by the State with the participation of representative organizations of workers and employers. The Committee requests the Government to provide information on the measures taken or envisaged to establish minimum wage fixing machinery.

Article 5 read in conjunction with point V of the report form. The Committee requests the Government to provide general information on the application of the Convention in practice, including information on: (i) the minimum wage rates applicable; (ii) available statistics on the number and different categories of workers covered by the minimum wage regulations; and (iii) the results of any inspections carried out (violations observed, sanctions imposed, etc.).