Report in which the committee requests to be kept informed of development - Report No 346, June 2007

Case No 2510 (Panama) - Complaint date: 30-JUL-06 - Closed

Allegations: Refusal to grant legal personality to a trade union association; dismissal of eight trade union leaders and failure to pay their salaries and statutory benefits

1244. The complaint is contained in a communication from the National Federation of Public Employees and Public Service Enterprise Workers (FENASEP), dated 30 July 2006. The organization sent further allegations in communications dated 30 November 2006 and 17 April 2007. The Government replied in communications dated 20 October 2006 and 15 March 2007.

1. 1245. Panama 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. 1246. In its communication dated 30 July 2006, FENASEP alleges the illegal dismissal of eight leaders of the Association of Officials of the Interoceanic Regional Authority (AFARI) on 13 July 2005, namely: Vidalia Quiroz, Secretary-General; Rolando Román, Secretary for Education, Culture and Sports; Beatriz Barría, Undersecretary for Administrative Careers; Leopoldo Hernández, Secretary for Defence and Labour Issues; Felipe Carrasco, Secretary for Organizational Matters; Doris Guillén, Minutes and Correspondence Secretary; Rodolfo Villacís, Press and Information Secretary; and Harry Vásquez, Secretary for Administrative Careers.
2. 1247. In its communication of 30 November 2006, FENASEP adds that the eight dismissed persons managed to persuade the Government to reassign them to posts in another institution with guarantees that they would be paid the salaries and benefits due to them. However, the eight persons have not received these payments and, in the new institutions, where they work as temporary workers, they have not received their salaries. In the case of the Secretary-General of the AFARI, her salary in the new institution has been reduced in relation to her previous salary. In its last communication, FENASEP indicates that the salaries and legal benefits corresponding to the months of December 2006 and March 2007 were not paid to the dismissed trade union leaders.
3. 1248. Finally, FENASEP adds that the Ministry of the Interior and Justice turned down the application for legal personality made by AFARI in February 2005, thereby violating ILO Conventions Nos 87 and 98 and Act No. 9 on administrative careers. In the attached documentation, the Ministry indicates that the reason for the refusal in the decision of 5 June 2006 is that the transfer of the Interoceanic Regional Authority (ARI) was planned for December 2005.
4. B. The Government’s reply
5. 1249. In its communication of 20 October 2006, the Government affirms that the allegations are incorrect. The issue of the renewal of the contracts of the officials who are members of the AFARI did not involve arbitrary dismissal, but rather the fact that the institution for which they were working, the ARI, ceased to exist, in accordance with the legal provisions under which it was established. The ARI was created by Act No. 5 of 25 February 1993 as an autonomous state body, with the principal objective of exercising autonomously the custody, exploitation and administration of property under the general plan and the partial plans approved with a view to its optimal use, in coordination with the competent state bodies, so that such properties could be gradually incorporated into the overall development of the nation. The properties concerned include the land, buildings, installations and other properties reverting to Panamanian control in accordance with the 1977 Panama Canal Treaties and their appendices (the Torrijos–Carter Treaties). Section 46 of the Act originally determined that the ARI would exist for as long as necessary to achieve its aims, but that in no case would it continue to exist beyond 2009.
6. 1250. Nevertheless, in view of the progress made by the ARI in achieving its objectives, this provision was amended by Act No. 7 of 7 March 1995 to amend and add certain sections to Act No. 5 of 25 February 1993 establishing the ARI and adopting measures on the properties reverting to Panamanian control. The Act advanced the duration of the ARI’s operation, providing in section 20 that it would function up to 2005. Section 46 reads as follows:
7. The Authority shall operate for the period necessary for the achievement of its aims, but in no case shall this period go beyond the year 2005, unless an extension is decided upon by law. Upon the expiry of the period indicated in this section, its functions shall be transferred to the state bodies with the respective competence, as determined by the Cabinet Council.
8. 1251. At the end of the period of operation of the ARI, the Government transferred its functions to the Administrative Unit for Reverted Property of the Ministry of the Economy and Finance (MEF), for which reason the contracts of the staff working for the ARI were terminated. This is what really happened. The allegations made in this case are therefore all the more surprising as it was common knowledge that the former ARI was subject to a date on which its functions would come to an end, as determined when it was created. It is regrettable that such a denunciation should have been made in full knowledge that there are no legal grounds for the reinstatement of the officials concerned, especially as they were working under contracts that were not renewed for obvious reasons.
9. 1252. The Government adds that all the officials of the former ARI, including those who are members of the AFARI, who worked temporarily from January to June 2006 in the Administrative Unit for Reverted Property of the MEF, were paid in full right up to the last two weeks corresponding to the period during which they were temporarily reassigned, which came to an end on 30 June 2006. Furthermore, the officials were paid for the 13 days that they worked following the expiry of their appointments (1–13 July 2006), as well as the 13th-month payment calculated on the basis of the period worked, and only their proportional leave payments are still pending. In light of the above, the Government considers that it has not violated the provisions giving effect to Conventions Nos 87 and 98 and indicates that, because of the budgetary restrictions affecting public finances, it would be impossible for economic and administrative reasons related to government administration to assign the leaders of the AFARI to other state institutions, as the same would have to be done for all the other former officials of the ARI.
10. 1253. In its communication dated 15 March 2007, with regard to the AFARI, the Government states that the legal personality requested is not that of a trade union organization, rather it is that of a not-for-profit association. Not-for-profit associations are processed by the Ministry of Government and Justice and are governed by the Civil Code (sections 64–75), as stated in the request for legal personality enclosed by the party presenting the allegations. Furthermore, it should be noted that the procedure for such legal personalities is covered by provisions not contained in the Labour Code, such as Act No. 33 of 8 November 1984, “Through which measures concerning administrative procedures are taken and other provisions are issued”, and Presidential Decree No. 524 of 31 October 2005, “repealing Presidential Decree No. 160, of 2 June 2000, and Presidential Decree No. 3 of 24 January 2001, and issuing provisions concerning the recognition of legal personality of private, not-for-profit associations and foundations”. The request for legal personality was refused on the basis of these provisions, in view of the fact that, as is pointed out in Resolution on Legal Personality No. 367-77, of 5 June 2006, of the Ministry of Government and Justice, observations had been made regarding the request but the applicant organization failed to act upon these observations within the period of time set out in the relevant provisions and in the said Resolution (enclosed by the complainants), which state that: “If the party concerned does not implement changes within three (3) months of the date of notification of the said changes, then the request for legal personality shall be refused through a Resolution, and the file shall be closed.” Therefore, in this instance, legal personality was refused to a civil, rather than a trade union organization and, moreover, it was refused owing to the expiry of the period of time allotted.
11. 1254. With regard to the cases of dismissal, the Government states that the officials concerned were employed at an institution known as the ARI, whose main function was the administration of the property that reverted to the control of the Republic of Panama following the conclusion of the Torrijos–Carter Treaties, and that the ARI was established for a fixed period ending on 31 December 2005. On this date, officials working for the ARI were to be made redundant, a fact of which they were aware. Moreover, the said functions concerning the remaining reverted property were transferred to the MEF. For humanitarian reasons, and having taken account of FENASEP’s views, some of these officials have been placed in posts in public institutions and there have been ongoing talks aimed at resolving the situation of the remaining officials. It is, therefore, inaccurate to speak of reprisals against the organization or against trade unionism.

C. The Committee’s conclusions

1. 1255. The Committee observes that, in the present case, the complainant organization alleges the dismissal of eight officials of the AFARI (which is in the process of being established) on 13 July 2005, and that the authorities refused to grant the association legal personality for which it applied in February 2005. In its last communication, the complainant organization states that the eight trade union leaders were reassigned to another institution as temporary workers, but did not receive the salaries and benefits due, and that the Secretary-General, Ms Vidalia Quiroz, received a lower salary than she had earned previously.
2. 1256. The Committee notes the Government’s statements that all of the workers who were members of the AFARI were paid their salaries and other benefits. The Committee also notes that the contracts of those members of the AFARI who were working under contract could not be renewed under the terms of Act No. 7 of March 1995, which provides that the mandate of the Interoceanic Regional Authority (ARI) shall not extend beyond the year 2005. The Committee notes with interest that the Government states that for humanitarian reasons, and having taken account of FENASEP’s views, some of the officials from what was formerly the ARI were placed in posts in public institutions and an ongoing dialogue was maintained to resolve the situation of the remaining officials. The complainant organization indicates that they were reassigned to another institution as temporary workers. In view of the fact that, according to the complainant organization, the Secretary-General of AFARI, unlike the other reinstated union leaders, is receiving a lower salary than she earned prior to her dismissal, the Committee requests the Government to examine this issue, in conjunction with the complainant federation, in order to determine whether anti-trade union discrimination occurred and, if so, to take measures to ameliorate, correct and resolve the situation. Moreover, with regard to the issue of the payment of salaries and other statutory benefits to the eight dismissed leaders, as in its last communication the complainant organization affirms that these payments were not made, the Committee requests the Government to ensure that the payments in question have indeed been made. The Committee requests the Government to keep it informed of developments in this respect.
3. 1257. With reference to the refusal to grant legal personality to the AFARI, the Committee notes that the documentation provided by the complainant organization includes the resolutions of the Ministry of the Interior and Justice of 20 April and 5 June 2006 refusing to grant legal personality to the AFARI on the grounds that the ARI’s legal mandate expired in December 2005 and that Executive Decree No. 160 of 2 June 2000 (as amended by Executive Decree No. 3 of 24 January 2001), repealed by Executive Decree No. 524 of 31 October 2005, requires that, to be able to apply for legal personality, an association has to have a five-year plan, that is, it has to exist for at least five years. The Government states that the legal personality requested was not that of a trade union, rather it was that of a not-for-profit organization. Moreover, the ARI had not acted upon the observations made regarding its request within the three-month time period. The Committee deeply regrets in this regard that Panamanian legislation does not authorize public officials to unionize.
4. 1258. In this regard, the Committee emphasizes that the requirement for public employees’ associations to have a five-year plan and, indirectly, a minimum duration of five years, is in contradiction with the right of workers’ organizations to draw up their constitutions in full freedom, as established in Article 3 of Convention No. 87. The Committee therefore urges the Government to take measures to amend Executive Decree No. 524 of 31 October 2005, so that the minimum period of existence of trade union associations is determined by their constitutions, and not by the law. The Committee regrets that the AFARI has been unable to obtain legal personality precisely at a time when the institution in which it was operating was on the verge of disappearing, thus preventing the association from adequately defending the interests of its members, including the payment of the salaries and benefits due.

The Committee's recommendations

1. 1259. 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 examine, in conjunction with the complainant federation, the situation regarding the Secretary-General of the AFARI, Ms Vidalia Quiroz, who contrary to the other reinstated union leaders, is receiving, according to the allegations, a lower salary in the new institution to which she has been reassigned than she earned previously. The Committee requests the Government to ameliorate, correct and resolve the situation if it finds that anti-union discrimination occurred. The Committee requests the Government to keep it informed of developments in this respect.
   • (b) The Committee requests the Government to ensure that the leaders of the AFARI have been paid the salaries and other benefits due to them and to keep it informed of developments in this respect.
   • (c) The Committee requests the Government to take measures to amend Executive Decree No. 524 of 31 October 2005, so that the minimum period of existence of trade union associations of public officials is determined by their constitutions, and not by law.