Interim Report - Report No 197, November 1979

Case No 927 (Brazil) - Complaint date: 23-MAR-79 - Closed

1. 326. In communications dated respectively 23, 26 and 27 March and 3 April 1979, the National Labour Front (FNT), the World Confederation of Labour (WCL), the World Federation of Trade Unions (WFTU) and the Latin American Central of Workers (CLAT), presented complaints of violation of trade union rights in Brazil. WCL sent additional information in support of its complaint on 11 May 1979. In the same communication it transmitted documentation sent to it by the National Labour Front and stated that it supported the complaint of that Organisation. The Government, for its part, sent its observations in a letter of 28 May 1979.
2. 327. Brazil has not ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), but has ratified the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. Allegations of the complainants

1. 328. The complaints of FNT, WFTU and CLAT, which were sent to the ILO by telegram, refer to the government decision to place under control the trade unions of the metallurgical and engineering industries of the State of Sao Paulo following a strike to obtain higher wages. CLAT also refers to dismissals affecting 450 workers.
2. 329. In its letter of 26 March 1979 WCL states that during collective bargaining in the metallurgical sector in Sao Bernardo do Campo, Santo André and Sao Caetano (all in the Sao Paulo industrial area), the employers' representatives refused to grant a 20 per cent wage increase which, according to WCL, was merely an adjustment to make good the loss of purchasing power.
3. 330. Following this refusal votes were taken in workers' assemblies - certain of which were attended by over 80,000 persons - and it was decided to call a strike of unlimited duration beginning 13 March 1979. The Government declared this move to be unlawful under legislation which, according to WCL, virtually denies the right to strike. Furthermore, continues the complainant organisation, although the strike spread to other major industrial centres of the State of Sao Paulo, such as Jundiai and Sao José dos Campos, the Government decided to place all the metalworkers' unions of Sao Bernardo do Campo, Santo André and Sao Caetano under control.
4. 331. WCL attaches to its letter of 11 May 1979 a communication dated 28 April 1979 addressed to the ILO by the National Labour Front and supported by the dismissed officials of the metalworkers unions of Sao Bernardo do Campo, Diadema and Santo André, the Metalworkers' Union of Sao Paulo, the Union of Workers in the Metallurgical Industries of Osasco and 12 other Brazilian workers' organisations in various sectors of activity.
5. 332. The documents annexed to the communication of ENT indicate that there are certain weaknesses in the Brazilian legislation. Firstly, it does not provide for effective sanctions against undertakings which do not respect the law. Secondly, it establishes strict supervision of unions by the Ministry of Labour by allowing the Minister or his regional delegates to intervene in any organisation on any pretext whatsoever. Thirdly, the right to strike of workers is non-existent. Finally, as from 1967, severance pay for older workers and stability of employment have been seriously affected by the creation of the "length of service guarantee fund", in that the guarantee of employment for trade union leaders is only temporary and that severance pay has been reduced without just cause.
6. 333. The ENT documentation also points out that, despite the provisions of section 616 of the consolidation of Labour Laws, under which employers do not have the right to refuse to bargain, they systematically attempt to evade their obligations when serious matters are to be discussed. Moreover, when problems arising out of collective agreements are brought before the labour courts, these do not examine the questions raised or confine themselves to applying the wage increases decided by the executive.
7. 334. As regards the labour dispute to which the complaints refer, it is stated that the trade unions in which the Ministry of Labour has intervened are geographically based in the seven centres of Greater Sao Paulo, where the automobile industry is concentrated.
8. 335. The document also states that a survey had been carried out by the Inter-Union Department of Socio-economic Studies and Statistics, a body set up by the unions. This survey had established that, in order to ensure the maintenance of the workers' purchasing powers, wages should be increased by 34.1 per cent. In order to obtain this compensation certain trade unions made unsuccessful appeals to the courts and others, including those mentioned in the complaints, exerted pressure from the rank and file, with or without strikes, and thus obtained partial payment of the 34.1 per cent increase by direct agreement with the employers or their organisations. Thus, in May and July 1978, the Union of Workers in the Metallurgical, Engineering and Electrical Equipment Industries of Sao Bernardo do Campo and Diadema and the Union of Machinery Industries of the State of Sao Paulo concluded agreements for an 11 per cent increase which was to be permanently incorporated into the wage and which might not be deducted from future adjustments.
9. 336. In February 1979 further negotiations took place. An agreement was signed by 31 unions represented by the Metalworkers' Federation of the State of Sao Paulo, who received wage increases of from 44-63 per cent, although the increases established by the Government were 44 per cent. Nevertheless, the 11 per cent increase agreed on in 1978 had been deducted from the adjustment, and three metalworkers' unions of Santo André, Sao Bernardo and Sao Caetano therefore decided to continue the strike which they had begun on 13 March 1979. After persistent failure to reach an agreement, the dispute was brought before the labour court on 14 March 1979, and it gave a judgement in less than 24 hours. By a decision which was not taken unanimously, the court granted a 44 per cent increase, the amount authorised by the executive, but less than that granted under the collective agreement signed by the 31 unions of the Metalworkers' Federation of Sao Paulo. Furthermore, the court declared the strike to be illegal.
10. 337. As a result of this failure, the workers decided to continue the strike. The Minister of Labour then went to Sao Paulo, where he tried in vain for several days to reconcile the parties. This led to the placing under control of the trade unions, the suspension of their leaders and the appointment of officials of the Ministry of Labour to head the trade union organisations on 23 March 1979.
11. 338. However, the workers continued to meet in the town hall of Sao Bernardo and in churches. When contacted by the parties, the National Synod of Brazilian Bishops enabled the resumption of the interrupted dialogue between the Government, the employers and the workers. The dismissed officials of the unions of Santo André, Sao Bernardo and Sao Caetano then accepted a 45-day truce and the extension of the agreement signed by the 31 unions of the Metalworkers' Federation of Sao Paulo, in the hope of finding an amicable solution to the dispute and the problem of payment for the time the workers were on strike. It was also understood that no striker would be dismissed. Accordingly, the strike ended on 27 March 1979.
12. 339. The Minister of Labour then said that the control of the trade unions might be ended in the near future and that the leaders who had been removed from office would be authorised to resume leadership of the trade unions. Subsequently, however, the Minister is said to have contradicted this statement. Finally, the document mentions the dismissal of about 1,000 workers despite the agreement reached on this point.
13. 340. The judgement of the Regional Labour Court of the Second Region which declared the strike to be illegal, and which is included in the documents supplied by ENT, refers to Act No. 4330 of 1 June 1964, to regulate the right to strike. Under section 5 of this Act "the exercise of the right to strike shall be based on a decision adopted by secret ballot by a majority vote of the general meeting of the industrial association representing the occupational category concerned, two-thirds of the members of the industrial association being present (in the case of a first convocation of the meeting) or one-third of the members (where the general meeting is convoked for the second time)". Furthermore, section 6 of the Act provides that every general meeting shall be convoked by the managing Committee of the industrial association concerned by notices published ten days beforehand in the local newspapers of the place where the industrial association is situated. The court did not find any evidence in the file that these formalities were respected and accordingly considered that the strike was illegal.
14. 341. In its covering letter to the communication from ENT, WCL declares that Brazilian legislation contains provisions which deny freedom of expression and association and the effective recognition of the right to bargain. According to WCL the labour legislation defines the trade union as a body for co-operation with the public authorities, which is subject to state control as regards the drafting of its rules, the election or removal from office of officials, its financial management, trade union meetings and its programme of action (prohibition of action contrary to the financial policy of the Government).
15. 342. In addition, WCL considers that there is ample proof of repeated violations of Convention No. 96, which Brazil has ratified. Thus, section 623 of the Consolidation of Labour Laws permits the suspension of any provision of a collective agreement which is in direct or indirect contradiction with the government's wages policy. Furthermore, section 8 of Act No. 5584 authorises the Government to appeal against judgements of the labour court, with suspensory effect, in the event that the percentage of wage increase agreed upon exceeds that laid down by the executive.
16. 343. WCL also refers to Act No. 5107 of 13 September 1966, to establish a length of service guarantee fund which, it says, gives the employer unlimited power to dismiss a worker even if there are no grounds to justify the dismissal. Thus, concludes WCL, the whole system of workers' protection is rendered inoperative.

B. Reply of the Government

1. 344. In its reply the Government first states that the placing under control of the unions mentioned in the complaints is based on the legislation which has been in force since 1943, the purpose of which is to guarantee the authority of a judicial body.
2. 345. The Government states that the Regional Labour Court declared the strike illegal solely because the unions concerned did not respect the formalities prescribed by Act No. 4330 to regulate the right to strike, as provided in section 165 of the Federal Constitution in fact, continues the Government, the unions called the strike without respecting the period of advance notice or convening general meetings as provided for under the legislation. In addition, Act No. 4330 prescribes that the vote-counting by the returning officers shall be presided over by a member of the legal service for labour matters (public prosecutor's department), and that the decision taken shall be notified to the local body of the Ministry of Labour. According to the Government none of these procedures was followed in the present case, and the legal counsel for the trade unions were unable to produce the records of the meetings as required by law. The court therefore declared the strike to be illegal.
3. 346. The Government states that the trade unions should then have complied with the judgement and should have decided to return to work, although it was open to them to lodge an appeal with the Higher Labour Court. However, they announced that they opposed the judgement and incited the workers to continue the strike. This attitude led the competent authority, namely the Minister of Labour, to decide to place the organisations under control in accordance with section 528 of the Consolidation of Labour Laws. This decision was preceded by appeals to the organisations concerned from the labour authorities requesting them to respect the legal order.
4. 347. As the officials of the organisations failed to appreciate the reasons why they should respect the court's decision and abandoned purely trade union objectives in flagrant violation of the law, the only course of action was that laid down by section 553, subsection 2, and section 724 of the Consolidation of Labour Laws, namely the removal of trade union leaders from office. The Government also remarks that the decisions of the judiciary must be respected by the community and that trade unions must respect the law of the land, as stipulated by Article 8 of Convention No. 87.
5. 348. The Government next refers to the principle expressed by the Committee in earlier cases, namely, that prohibition of strikes in the event of a legal dispute does not constitute violation of freedom of association. It also states that the report submitted to the international Labour Conference on the occasion of the adoption of Convention No. 87 stated that Article 8 of the Convention should not be interpreted in such a way as to jeopardise the independence and authority of the courts. In the Government's opinion this is precisely what the trade unions have done in the present case.
6. 349. In a note attached to its communication the Government mentions that, by Order of 16 May 1979, the Ministry of Labour has suspended the control of the three trade unions, thus putting an end to the suspension of their leaders. The Government says that this is because they have changed their earlier stand and have taken concrete steps for the application of the decision o-f the Regional Labour Court. Respect for the judicial decision thus having been re-established and the independence and authority of the court reaffirmed, the executive was able to put an end to the control of the trade unions and reinstate their leaders. The Government remarks that these leaders brought no judicial action when they were removed from office, although Brazilian law provides for a special right of appeal against acts of the authorities which are considered to violate the rights of the individual.

C. Conclusions of the Committee

1. 350. The Committee notes that the complaints made in the present case contain five types of allegations: the decision as to the illegality of the strike called by the metalworkers' unions in the Sao Paulo region in March 1979 and the alleged practical impossibility of exercising the right to strike; the placing under control of these organisations and the suspension of their leaders; dismissals of workers following the strike; state control of the operation of trade unions; and, finally, restrictions on the right to bargain collectively.
2. 351. As regards the decision that the strike in the metallurgical sector of Sao Paulo was illegal, it appears from the information in the Committee's possession that the dispute arose out of a difference of opinion during collective wage negotiations. A wage adjustment granted in 1978 had, it appears, been deducted from the increases granted during negotiations in 1979. The dispute had been brought before the labour court after the strike had broken out. The latter handed down a judgement which, on the one hand, granted a wage increase limited to that authorised by the Government and, on the other hand, declared the strike illegal on the basis of the legislative provisions regulating the right to strike. It would seem, from the information supplied by the Government, that the trade unions did not respect these provisions.
3. 352. Despite the fact that the strike had been declared illegal, it continued for almost two weeks, following which a truce was accepted for the purpose of reaching an amicable solution and work was resumed.
4. 353. In the many cases relating to the right to strike which have come before it, the Committee has considered that the right to strike is one of the essential means through which workers and their organisations may promote and defend their occupational interests. On the basis of this principle the Committee has considered that the conditions that have to be fulfilled in order to render a strike lawful must be reasonable and in any event not such as to place a substantial limitation on the means of action open to trade union organisations.
5. 354. The conditions fixed for the calling of a strike by Brazilian law, and in particular by Act No. 4330 of 1964, are of various kinds. The decision must be adopted by secret ballot by a majority vote of the general meeting of the industrial association, two-thirds of the members of the industrial association being present (in the case of a first convocation of the meeting) or one third of the members (where the general meeting is convoked for a second time). The convocation of the meeting must be published ten days beforehand in the local newspapers. The returning officers must be presided over by a magistrate, and a copy of the decision transmitted to the authorities and the employer, the latter being granted a period of five days in which to accept the claims, after which a strike may be declared subject to a further period of notice of five days.
6. 355. In the past, the Committee has considered acceptable the obligation to observe a certain quorum, to take decisions to strike by secret ballot, and to give prior notice to the employer before calling the strike. Nevertheless, the Committee feels obliged to remark that the observation of a quorum of two-thirds of the members, as fixed by Brazilian legislation for the first meeting, may be difficult to reach, in particular where trade unions have large numbers of members or cover a large area. In these circumstances the obligation to convene a further meeting at ten days' notice may result in considerable delay before a decision to strike may be considered to be valid. In this respect the Committee has taken note of a draft Bill to revise the Consolidation of Labour Laws, which was published in the Official Gazette of Brazil on 2 may 1979. It notes that this draft Bill, which is now to be submitted to Parliament, proposes to reduce the quorum required before a strike can be called.
7. 356. Apart from the formal conditions for calling a strike, Brazilian legislation contains provisions regarding the submission of collective labour disputes to conciliation and arbitration. In this connection the complainants have stated that the exercise of the right to strike is denied in practice. The Committee examined these provisions of Act No. 4330 in an earlier case relating to Brazil, when it noted that, under section 11 of the Act, the authorities are under the obligation to take such action as may induce a settlement between workers and employers during the five-day period following the general meeting. Furthermore, according to section 23, if conciliation fails, the matter is referred to the President of the Regional Labour Court. The decision of the Court is executory. As the Committee has already pointed out, the provisions mentioned above may jeopardise the workers' possibility to strike and deprive them of an essential method of promoting and defending the interests of their members. While noting that the right to strike is recognised by the Brazilian Constitution, the Committee can only confirm its conclusions in the present case and stress that such restrictions are not in conformity with the principles of freedom of association and that, if workers' organisations are under the obligation to respect the law of the land, as the Government indicates, the law of the land must not be such as to impair, nor must it be so applied as to impair, the generally accepted rights of trade unions.
8. 357. As regards the placing under control of the three unions mentioned in the complaint and the suspension of their leaders, the Committee notes the Government's statement to the effect that these measures were taken because the said leaders had failed to respect the court decision pronouncing the strike illegal. The Committee also notes with interest that, once the decision to resume work had been taken, the Government put an end to the control of the unions by the authorities and to the suspension of the union leaders.
9. 358. In connection with this aspect of the case the Committee must, however, recall that it has on a number of occasions examined cases concerning the placing under control of the unions by the Brazilian authorities. In these cases the Committee has drawn the attention of the Government to the principle that workers' organisations should have the right to elect their representatives freely and to organise their administration and activities, and that the public authorities should refrain from any interference which would restrict this right or impede the lawful exercise thereof. The Committee also pointed out that the placing of trade union organisations under control entails a serious danger of restricting this right.
10. 359. In reaffirming these principles the Committee wishes to state that control of the internal activities of a trade union may be compatible with freedom of association when the organisation contravenes legislative provisions, which, however, should not be such as to violate the principles of freedom of association. Nevertheless, it is highly important, in order to guarantee the impartiality and objectiveness of the procedure, that this control should be exercised by the competent judicial authority. In this connection the Committee notes that the draft Bill to revise the Consolidation of Labour Laws mentioned above proposes to abolish the powers at present enjoyed by the Ministry of Labour to suspend trade union leaders or remove them from office, close down organisations temporarily or cancel their certificates of registration.
11. 360. The Committee notes that the Government has not sent its observations concerning the alleged dismissal of around 1,000 workers following the strike, nor concerning the general allegations that the legislation empowers the authorities to exert control over the operation of trade unions (drawing up of rules, election of officers, financial management, trade union meetings) and that the right to collective bargaining is subject to restrictions.

The Committee's recommendations

1. 361. In these circumstances, the Committee recommends the Governing Body:
   • (a) as regards the right to strike, to draw the attention of the Government to the principles and considerations set forth in paragraphs 351 to 356 above and to stress that the conditions that have to be fulfilled in order to render a strike lawful must not be such as to place a substantial limitation on the means of action open to trade union organisations;
   • (b) as regards the placing under control of trade union organisations in the metallurgy sector of Sao Paulo and the suspension of their leaders:
   • (i) to note with interest that these measures have been lifted;
   • (ii) nevertheless, to draw the attention of the Government to the principles set forth in paragraphs 358 and 359 above and to recall that the power of the administrative authorities to order the placing of trade unions under control and the suspension of trade union leaders do not offer the necessary guarantees to ensure the right of trade unions to organise their administration and their activities;
   • (c) as regards the other aspects of the case, to request the Government to send its observations on the allegations concerning the dismissals of workers following the strike, and on the general allegations concerning the legislative provisions relating to the control exercised by the authorities on the operation of trade unions and restrictions on the right to bargain collectively;
   • (d) to take note of the present interim report.