Interim Report - Report No 281, March 1992

Case No 1578 (Venezuela (Bolivarian Republic of)) - Complaint date: 23-APR-91 - Closed

1. 384. The General Confederation of Workers (CGT) submitted a complaint alleging the violation of freedom of association in a communication of 23 April 1991. The Government sent its observations in a communcation of 27 January 1992.
2. 385. Venezuela has ratified the Freedom of Association and Protection of the Right to Organise Convention 1948 (No. 87), as well as the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainant's allegations

1. 386. In its communication of 23 April 1991, the General Confederation of Workers (CGT) states that on 23 November 1990 the Ministry of Labour, after verifying that the Single Trade Union of Sales and Distribution Workers of the Cevecería Polar del Lago C.A. enterprise (in Zulia) had complied with statutory requirements, approved the registration of this organisation in the register of trade unions, which was subsequently carried out.
2. 387. The complainant organisation adds that the Cervecería Polar del Lago C.A. enterprise filed an appeal against the administrative act which had authorised the registration of the trade union organisation; on 10 January 1991, without having given the trade union the opportunity to present its arguments against this appeal, the Ministry of Labour (Administrative Appeals Branch) concluded that the workers who made up this organisation and who had requested its registration as a trade union organisation, were not employed within the enterprise, and therefore declared null and void the administrative act of the General Sectoral Labour Directorate (Trade Unions Branch), thereby overturning the ruling of 23 November 1990, and rescinding the organisation's registration in the Zulia Labour Inspectorate's register of trade unions.
3. 388. The complainant organisation concludes by stating that the enterprise has dismissed 26 workers since the Ministry of Labour revoked the trade union's registration.

B. The Government's reply

1. 389. The Government states in its communication of 27 January 1992 that the Labour Inspection Service having jurisdiction in the State of Zulia did in fact, on 23 November 1990, certify the Single Trade Union of Sales and Distribution Workers of the Cervecería Polar del Lago C.A. enterprise, and that the enterprise then filed an appeal before the General Sectoral Labour Directorate, alleging that the promoters of this trade union organisation were not employees of the enterprise, which is an essential requirement for the trade union's legality; this came about because the Labour Inspection Service did not notify the enterprise before making its decision, thereby failing to comply with the provisions of the Administrative Procedures Act and the Labour Act. According to the enterprise, whose statements are confirmed by the corresponding official documents, the group of individuals in question had a commercial relationship with the enterprise, as evidenced by the fact that it was duly registered in the government registry of commercial concerns; therefore, their relationship with the enterprise was commercial in nature, and did not involve natural persons or contracts of employment.
2. 390. The Government adds that both Venezuelan doctrine and jurisprudence have established the following criteria for determining whether an employment relationship exists: (1) a service must be rendered; (2) remuneration must be paid; and (3) there must be a state of subordination or dependency. The first requirement is subject to orders and instructions given by the employer as regards the performance of tasks inherent in the service rendered, but the workers who promoted the trade union organisation in question do not work in the enterprise, and therefore do not render services. What binds the parties is a concession agreement, whose clauses define obligations which may be performed by a third party; this further contradicts one of the characteristics of employment relationships - intuitu personae. Another fact which supports the absence of an employment relationship between the so-called trade union organisation and the enterprise is that they are merchants; they do not receive wages, but earn profits from the sale of products (beer and malts) which they acquire by means of cash payments. Their earnings depend exclusively on the efforts they devote to placing their merchandise with the clients in the zone or route specified in the concession agreement. There is no subordination or legal dependency between the parties; instead, what binds them is a concession agreement which defines the zone or route which is exclusively reserved to the person signing the agreement; the parties are also bound not to enter into concession agreements with other sales agents or concessionaires, unless otherwise stipulated in the agreement.
3. 391. The Government concludes that from this perspective the relationship between the parties is governed by a purchase/sale contract under which one of the parties sells beer and malts to the other, who in turn distributes the product in specified areas, agreeing by means of the concession agreement to purchase the product at a given price. The concessionaire distributes the beer and malt he has purchased, and sells them at his own risk and account, with his own vehicle (truck), using drivers or helpers he has hired; this shows that the concessionaire is not bound to the enterprise by an employment relationship, since he is responsible for his own profits and losses.
4. 392. The Government encloses the jurisprudence of labour courts, a copy of a decision taken by the Ministry of Labour which overturns the ruling which legalised the trade union, on the grounds that the persons who make up the Single Trade Union of Sales and Distribution Workers of the Cervecería Polar del Lago C.A. enterprise in the State of Zulia are not employees of the enterprise, as well as a copy of decisions which confirm the decision of the Ministry. The Government concludes that the legal relationship between the company and the concessionaires who make up the Single Trade Union of Sales and Distribution Workers of the Cervecería Polar del Lago C.A. enterprise is commercial in nature; in accordance with Venezuelan labour jurisprudence, it is not possible to legalise trade union organisations of beer and malt distributors since their relationship is purely commercial, as defined in section 2 of the Code of Commerce, which establishes the obligations and relations between merchants. For these reasons the Government considers that there has been no violation of freedom of association.

C. The Committee's conclusions

1. 393. The Committee notes that the allegations presented by the complainant organisation refer, on the one hand, to the Ministry of Labour's decision to annul its earlier registration of the Single Trade Union of Sales and Distribution Workers of the Cervecería Polar del Lago enterprise (in Zulia) at the request of the company, and the subsequent dismissal of 26 workers from this enterprise.
2. 394. As regards the registration of the trade union organisation known as "Single Trade Union of Sales and Distribution Workers of Cervecería Polar del Lago", issued by the Ministry of Labour, and the subsequent annulment of this administrative act by the Administrative Appeals Branch of the same Ministry, the Committee notes that, according to the Government, Cervecería Polar del Lago C.A. filed review proceedings alleging that the promoters of this trade union organisation were not workers in the enterprise, which is an indispensable requirement for the legal constitution of a trade union, and that these individuals are bound to the enterprise by means of a concession agreement, adding that the nature of the legal relationship between the concessionaires and the enterprise is a commercial one, and that in accordance with labour jurisprudence, it is not possible to recognise the trade union organisation of the distributors in question, owing to the fact that the relationship is purely commercial.
3. 395. In this connection the Committee points out that it does not have the competence to express an opinion concerning the legal relationship (labour or commercial) between the distributors and sales agents concerned and the Cervecería Polar del Lago enterprise. It notes that, according to the Government's statements, the absence of an employment relationship implies that these workers are not covered by the provisions of the Labour Act and that they cannot therefore establish a trade union. It therefore requests the Government to supply information on the type of organisations that sales and distribution workers could establish, and to indicate the texts and procedures under which these organisations could be established and the activities that they could undertake.
4. 396. In these conditions, the Committee emphasises that Convention No. 87 permits the exclusion only of the armed forces and the police, and therefore, that persons engaged in the distribution and sale of beer should be able to set up organisations of their choice (Convention No. 87, Article 2).
5. 397. As regards the 26 workers dismissed by the Cervecería del Lago enterprise, the Committee notes that the Government has not replied to these allegations. It therefore requests the Government to make its observations in this respect, indicating which workers were dismissed, their functions in the enterprise and the grounds upon which these measures were taken. The Committee also requests the complainant organisation to make any further comments that it may wish to add on this matter.

The Committee's recommendations

1. 398. In the light of the foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee requests the Government to supply information on the type of organisations that sales and distribution workers could establish, and to indicate the texts and procedures under which these organisations could be established and the activities that they could undertake.
   • (b) The Committee requests the Government to indicate the status of the 26 workers from the Cervecería del Lago C.A. enterprise who were dismissed, their functions in the enterprise and the grounds upon which these measures were taken.
   • (c) The Committee also requests the complainant organisation to make any further comments that it may wish to add on this matter.