Report in which the committee requests to be kept informed of development - Report No 320, March 2000

Case No 2047 (Bulgaria) - Complaint date: 23-AUG-99 - Closed

Allegations: the use of biased criteria for determining the representativeness of trade unions for participation in the National Labour Council; favouritism towards certain trade unions in respect of collective bargaining

1. 330. In a communication dated 23 August 1999, the World Confederation of Labour (WCL) submitted a complaint of violations of freedom of association against the Government of Bulgaria.
2. 331. The Government sent its reply in a communication dated 29 December 1999.
3. 332. Bulgaria has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), and the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainant's allegations

1. 333. In a communication dated 23 August 1999, the World Confederation of Labour (WCL) recalls that, following the changes at the end of the 1980s leading to a process of gradual democratization of the country, there were two main unions in Bulgaria: The Confederation of Independent Trade Unions of Bulgaria (CITUB), the ex-Communist union and PODKREPA. The involvement of PODKREPA in the political events leading to the overthrow of the Government in 1992 as well as the increasing democratization of civil society led to several workers leaving PODKREPA to form several new independent trade union organizations. Indeed, as at 1998, there were several trade union organizations in the country. Apart from CITUB and PODKREPA, the main new trade unions created following the breakaway from PODKREPA were PROMYANA and ADS (Association of Democratic Syndicates).
2. 334. Within a complex and changing situation of democratization, transition to a market economy and the slow development of an effective system of the rule of law, the Government decided to clarify the issue of trade union representativeness in Bulgaria. The most representative organizations would then represent workers on the National Tripartite Council.
3. 335. Linked to this were two other issues. Firstly, the necessity to distribute trade union property after the Communist era. The second issue concerns the growing tensions over the question of collective bargaining agreements, especially at the enterprise level. Neither of these matters has yet been resolved. While legislation is in place to secure the right of all trade unions to sign collective bargaining agreements, there is a systematic pattern of favouritism whereby collective agreements are signed between employers, the Government and only some unions -- thus marginalizing other unions.
4. 336. The initiative of the Government to undertake a census to determine representativeness was welcomed by the trade unions, including PROMYANA and ADS. On 17 February 1998, the Bulgarian Government passed Decree No. 41 which adopted the Ordinance relating to the procedure for determining the representative organizations of workers and employees. This Decree was adopted by the Council of Ministers without prior discussion with all the trade union organizations. Furthermore, it set out criteria to measure the representativeness of trade unions which differed from the pre-established criteria provided for in the Bulgarian Labour Code.
5. 337. The key element in Decree No. 41 was to introduce a new and central criterion in the assessment of representative trade unions, namely, that of the number of workers that are party to officially registered collective bargaining agreements concluded in companies and other organizations. The trade unions PROMYANA and ADS immediately expressed their deep concerns and disapproval of the Decree. Not only did they contest the conditions in which the Decree was passed but they also questioned the legality of the Decree and particularly the criterion chosen to measure the representativeness of trade unions.
6. 338. In the face of opposition from the Government, PROMYANA and ADS refused to participate in the census operation. This decision was also motivated by the fact that the Government and many employers were systematically refusing to sign new collective agreements with PROMYANA which could be annexed to existing agreements. Furthermore, they refused to make local unions of PROMYANA and ADS party to the existing agreements. On the other hand, they were willing to permit individual members of PROMYANA and ADS to be party to these agreements but strictly on an individual basis - not as a union. Hence, even if PROMYANA wished to accept this criterion for the trade union census, its position was being undermined by the authorities and a majority of employers.
7. 339. The Government did not address the concerns of PROMYANA and ADS and went ahead and conducted the census with CITUB and PODKREPA. Meanwhile PROMYANA and ADS filed a case in the High Court of Bulgaria asking for a ruling on the legality of the Decree.
8. 340. On 14 January 1999, the Council of Ministers accepted the report of the Minister of Labour and Social Policy on the state of trade union representativeness based on the criterion of the number of collective bargaining agreements signed. According to this report the representative trade union organizations to sit on the National Tripartite Council were CITUB and PODKREPA.
9. 341. The positions of PROMYANA and ADS however were supported by the Bulgarian High Count's ruling dated 17 December 1998 and rendered public on 18 January 1999 which abrogated all the articles in Decree No. 41 that changed the criteria to measure the representativeness of workers' organizations. This ruling was an important victory for PROMYANA and ADS. Unfortunately, a series of other initiatives undertaken in order to ensure that the Government respects the decision of the High Court were to no avail.
10. 342. The complainant considers that the passing of Decree No. 41 and the consequent implications on trade union representation on the National Tripartite Council constitutes a violation of trade union rights by the Government of Bulgaria.
11. 343. The complainant recalls that section 3(3) of the Labour Code outlines the objective criteria to be used to ascertain the representativeness of trade union organizations as follows: "Representative organizations of workers and employees that can be recognized on the national level are those who have no less than 50,000 members, unite workers and employees in more than half of the branches, and have built national and territorial bodies." Nowhere in the Labour Code is mention made of the number of collective bargaining agreements signed as a basis to measure the representativeness of trade unions.
12. 344. Whilst welcoming the initiative to undertake a census to measure trade union representativeness in Bulgaria, the complainant considers that the imposition of Decree No. 41 by the Bulgarian Government is an attempt to influence unduly the composition of the National Tripartite Council. By imposing biased criteria in Decree No. 41 and by refusing to respect the ruling of the High Court, the Bulgarian Government has violated trade union rights, limiting the right to organize and collective bargaining in Bulgaria and favouring some trade union organizations while marginalizing the independent trade unions like PROMYANA and ADS.
13. 345. The complainant emphasizes that this criterion for determining representativeness must be seen within the context of the historical background and current setting for collective bargaining in Bulgaria. Before the creation of both PROMYANA and ADS, a vast majority of collective bargaining agreements were signed between companies and the existing unions at that time, namely CITUB and PODKREPA. Since 1993, these collective bargaining agreements have not been renewed and have taken on the nature of "perpetual" collective agreements. Therefore PROMYANA and ADS were handicapped not only for their newness but also by the almost "eternal" nature of collective agreements.
14. 346. An illustration of this can be found in the case of the mining company of Bobov Dol. The mine has 6,400 workers out of which 1,500 are members of PROMYANA. Initially only two trade unions existed in the company, namely CITUB and PODKREPA. They signed a collective agreement with the employers in 1996. In 1997, a local union of PROMYANA was created which rapidly gained many affiliates. Taking into consideration the changes in the economic situation of the mine as well as the trade union situation, a referendum was called to collect signatures in favour of concluding a new collective bargaining agreement. As many as 50 per cent of the workers agreed to the proposal to conclude a new collective agreement. However this proposal was blocked in the tripartite committee of the company where PROMYANA was not represented. Despite the clear signal of workers in Bobov Dol to negotiate a new agreement with management, the existing trade unions (PODKREPA and CITUB), the management and the administration refused.
15. 347. On the issuing of Decree No. 41, both PROMYANA and ADS had indicated to the Government that they were willing to bow to that criterion if it was still possible to conclude new collective bargaining agreements or at least annex agreements of the new trade union organizations to the existing agreements. This option was not possible and in fact in the Ministry of Industry, and in the Ministry of Agriculture, Forestry and Agrarian Reforms, negotiations were opened between the authorities and the trade unions CITUB and PODKREPA - however PROMYANA and ADS were excluded from this process.
16. 348. The WCL further considers the imposition of Decree No. 41 a violation of trade union rights because by blatantly imposing an arbitrary and unjust measure of trade union representativeness on workers, the Government is subtly but firmly influencing the free choice of workers to belong to unions of their own choosing. This is firstly because the issue of representativeness will determine which trade unions will represent workers on the National Tripartite Council which will oversee all negotiations between social partners at the national level. The presence or not of a trade union on such a Council is perceived by workers as a test of the capacity of a trade union to defend their occupational interests. Consequently, for the worker on the shop-floor it is an important consideration in choosing a trade union.
17. 349. Secondly, the measure of representiveness will eventually influence the distribution of trade union property and resources left over from the Communist era. A discriminatory distribution of such property in favour of some trade union organizations will certainly indirectly influence the freedom of workers to belong to organizations of their own choosing.

B. The Government's reply

1. 350. In a communication dated 29 December 1999, the Government states that the representation of organizations of workers and employees is not regulated by the law; it has to be approved according to the applicable procedures. As per section 3(5) of the Labour Code, the Council of Ministers is the authority which designates the organizations of workers and employees as nationally representative. Thus it has to determine the cumulative fulfilment of representation criteria as per section 3(3) of the Labour Code (i.e. more that 50,000 persons membership, the organization of workers and employees to unify workers and employees in more than a half of the branches and to have established national and territorial structures).
2. 351. The right of the Council of Ministers to define the procedures for determining the fulfilment of the representation criteria of organizations of workers and employees is stipulated in section 3(5) of the Labour Code. Thus, in application of the legal provision, the Council of Ministers passed Decree No. 41 of 17 February 1998 regarding the adoption of the Ordinance about the procedure of laying down availability of criteria for representation of the organizations of workers and employees. As stipulated, a poll was carried out in order to have the representation criteria determined; the Ordinance is still in force.
3. 352. It is true, that the criteria specified in the Ordinance - representation criteria to be based on data on workers' and employees' organizations which are covered by collective agreements, signed in companies and other enterprises as per Chapter IV of the Labour Code - were repealed by the High Administrative Court of Bulgaria. But this does not in any way prevent the organizations claiming for representation to have this determined without using the repealed criteria. In this case sections 3 and 4 of the Ordinance apply:
   • -- "Membership" - with a unified statement for organizations of workers and employees in the relevant company or other enterprise or organization, composed of official data, determined by organizational and financial documents for membership fees of the respective organization of workers and employees.
   • -- "Unification of workers and employees in more than a half of the branches" - with a unified statement for the national branch organizations of workers and employees composed on the basis of official documents of the national branch organizations that belong to it, and certified by them.
   • -- "Established national and territorial bodies" - with a unified statement for each national organization of workers and employees composed on the basis of official documents for their setting up and for the availability of national and territorial bodies, determined in their statute.
4. 353. The Bulgarian Government is ready to apply the amended Ordinance, but so far this has not been requested by PROMYANA and ADS. The Government expresses the will to carry out a union poll; this option is not excluded. When the criteria stipulated in section 3(3) of the Labour Code are established, the Government would recognize the representation of each organization of workers and employees. The poll is not a closed procedure and is not definitive and final, but one should bear in mind that this is a rather costly and lengthy process. The previous poll lasted for more than six months. One should also note that PROMYANA and ADS boycotted the previous poll, while the general headquarters of the branch unions in Bulgaria took part although they had a small membership.
5. 354. The Government therefore considers the complaint regarding the violation of the rights of PROMYANA and ADS, hence the violation of Conventions Nos. 87 and 98, is not grounded.
6. 355. As concerns the complaint of violations regarding collective bargaining at the enterprise level, sections 50-59 of the Labour Code provide that only one collective agreement shall be concluded with a given employer. This can be achieved in two ways:
   • -- Section 51(4) of the Labour Code makes it possible for organizations of workers and employees to present a common approved draft and in this case all of them will be a party of the concluded collective agreement.
   • -- If they do not agree on a draft, as per section 51(5) of the Labour Code, the employer concludes a collective agreement with the organization of workers and employees whose draft has been approved by the General Assembly of workers and employees with a majority of more than 50 per cent of the votes.
7. 356. There are no provisions in Bulgarian labour legislation for the Government or the employer to influence the autonomy and will of organizations of workers and employees members and representatives in determining the sides of the collective agreement. This has nothing to do with the will of the Government, the employer preferences nor with the state of representation of the organizations of workers and employees. Since the collective agreement is an agreement between two equal parties, the conclusion of the contract depends only on their will. The Government is of the opinion that this legislation is in harmony with Conventions Nos. 87 and 98. Moreover, the intervention of the Government in the relations between the organizations of workers and employees and the employer would drastically violate the said Conventions.
8. 357. The Government does affirm, however, that for the implementation of the collective bargaining mechanism one should not allow the possibility of collective agreements becoming "forever valid" by signing additional agreements for their continuation by the same contracting parties or by adding a stipulation for automatic continuation of the collective agreement until the conclusion of a new one. Although this, in a certain sense, is an intervention in the relations between employers and organizations of workers and employees the Government considers that the rights of some organizations of workers and employees may otherwise be violated. For this reason the Government intends, in the context of an expected substantial amendment of the Labour Code, to make a proposal to the Parliament to change the collective bargaining part. The amendment should stipulate a time limitation to the signed collective agreement so that after its expiration new negotiations shall start to reflect the will of all interested organizations of workers and employees.

C. The Committee's conclusions

1. 358. The Committee notes that the complaint in this case concerns the establishment of biased criteria for determining representativeness for participation on the National Tripartite Council in violation of Conventions Nos. 87 and 98 and of the Bulgarian Labour Code. It further notes the allegations of favouritism towards certain national trade union organizations which has hindered the efforts of two independent unions, PROMYANA and ADS, to negotiate collective agreements at the enterprise level.
2. 359. Firstly, the complainant asserts that Decree No. 41 adopting an Ordinance about the procedure of laying down the availability of criteria for representation of the organizations of workers and employees violates both trade union rights and Bulgarian labour law by setting forth the number of workers that are party to officially registered collective bargaining agreements as a new and central criterion. The Committee further notes from both the complainant and the Government's reply that this criterion has been annulled by the High Court. The Government has stated in its reply that there is nothing to prevent the organizations from claiming for representation determined on the basis of the amended Ordinance using the criteria set forth in section 3(3) of the Labour Code (i.e. more than 50,000 members, unification of workers and employees in more than half of the branches and established national and territorial structures) and has expressed its willingness to carry out a union poll. According to the Government, the poll is not a closed procedure nor is it definitive and final; the last poll, which PROMYANA and ADS boycotted, took more than six months however.
3. 360. In the light of the Government's acknowledgement that the new criteria set forth in Decree No. 41 have been repealed by the High Court, as well as its willingness to conduct a poll on the basis of the criteria set forth in section 3(3) of the Labour Code, the Committee considers that the issue of the biased nature of the criterion set forth in Decree No. 41 is no longer pertinent to this case. As for the criteria laid down in section 3 of the Labour Code, the Committee recalls that it has already examined the conformity of these criteria with the principles of freedom of association and found that they appeared to be consistent with its principle of objective and pre-established criteria (see 305th Report, paras. 96-98). Noting however that, according to the complainant, the Government has already issued a report naming the members of the National Tripartite Council, apparently on the basis of the annulled criteria, the Committee requests the Government to undertake a new poll, including PROMYANA and ADS, to determine the representativeness of these organizations in accordance with pre-established and objective criteria. The Committee requests the Government to keep it informed of any developments in this respect.
4. 361. The Committee also notes the complainant's allegations that numerous collective agreements signed prior to the formation of PROMYANA and ADS have become "perpetual" in nature and that their demands to negotiate collective agreements are systematically refused. It notes the allegation that PROMYANA and ADS were excluded from negotiations in the Ministry of Industry and in the Ministry of Agriculture, Forestry and Agrarian Reforms and further notes the complainant's specific allegation that, despite a referendum signed by as many as 50 per cent of the workers, the management of a mining company, along with the two other trade unions represented on the company's tripartite committee, blocked the proposal. The Committee notes the Government's affirmation that perpetual agreements whereby the same contracting parties sign additional agreements for their continuation or by adding stipulations for automatic continuation of collective agreements may result in a violation of the rights of some workers' organizations. In this respect, the Government indicates that it intends to propose an amendment to the Labour Code proposing a time limitation on the duration of collective agreements. When examining legislation touching upon the duration of collective agreements, the Committee has indicated its awareness that, at least potentially, the possibility of concluding collective agreements for a very long term entails a risk that a union with borderline representativity may be tempted to consolidate its position by accepting an agreement for a longer term to the detriment of the workers' genuine interests (see Digest of decisions and principles of the Freedom of Association Committee, 4th edition, 1996, para. 905). Noting the Government's intention to propose an amendment to the Labour Code setting forth a maximum limit for the duration of collective agreements, the Committee considers that the duration of collective agreements primarily is a matter for the parties involved but if government action is being considered any lgislation should reflect tripartite agreement. It requests the Government to keep it informed of any developments in this respect.

The Committee's recommendations

1. 362. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee requests the Government to undertake a new poll, including PROMYANA and ADS (the Association of Democratic Syndicates), to determine the representativeness of these organizations in accordance with pre-established and objective criteria and requests the Government to keep it informed of any developments in this respect.
   • (b) Noting the Government's intention to propose an amendment to the Labour Code setting forth a maximum limit for the duration of collective agreements, the Committee considers that the duration of collective agreements primarily is a matter for the parties involved, but if Government action is being considered any legislation should reflect tripartite agreement. The Committee requests the Government to keep it informed of any developments in this respect.