Report in which the committee requests to be kept informed of development - Report No 368, June 2013

Case No 2980 (El Salvador) - Complaint date: 21-AUG-12 - Follow-up

Allegations: Presentation by the authorities, without prior consultation of the tripartite national body, of a proposed reform of 19 laws on official autonomous institutions, which affects employers’ interests and empowers the President of the Republic to appoint employer sector representatives on joint and tripartite management boards

1. 300. The complaint was presented in a communication dated 21 August 2012 from the National Association of Private Enterprises (ANEP).
2. 301. The Government sent its observations in a communication dated 26 February 2013.
3. 302. El Salvador 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. 303. In its communication dated 21 August 2012, the ANEP alleges that, on 16 August 2012, the President of the Republic introduced a proposal to reform 19 organic laws on official autonomous institutions, without consulting the employers’ and workers’ organizations, and that the reform would modify the former’s participation in the said institutions by empowering the President to designate the employer sector’s representatives on their management boards, thereby violating ILO Convention No. 87 and, specifically, the right of employers’ organizations to choose their representatives freely and the obligation for public authorities to abstain from any intervention that is liable to restrict that right or impede its legal exercise.
2. 304. The ANEP states that the proposed reform violates the principle of independence of employers’ and workers’ organizations and, by empowering the President to decide who should represent the employer sector in autonomous institutions (which currently have joint or tripartite management boards), constitutes a form of interference that goes against the provisions of Conventions Nos 87 and 98.
3. 305. The ANEP alleges that this is contrary to the principles laid down by the Committee on Freedom of Association with regard to tripartite consultation and the participation of employers’ and workers’ organizations in joint and tripartite bodies. According to the Committee on Freedom of Association, preventing an organization from taking part in the joint and tripartite bodies of a sector or industry in which it is representative is an infringement of the principles of freedom of association.
4. 306. The ANEP adds that the Committee of Experts has drawn attention to organizational principles for the governance and proper administration of social security institutions, whereby the process is supervised by the public authorities and administered jointly by employers and workers, whose contributions account for the bulk of the social security system’s revenue. A reform such as that proposed, under which it would be the President who appoints the employers’ representatives in institutions as important as social security, is contrary to the organizational principles for their proper administration laid down by the ILO in defence of the workers and employers who contribute to the system.
5. 307. The ANEP emphasizes that El Salvador has ratified the ILO’s Tripartite Consultation (International Labour Standards) Convention, 1976 (No. 144), which requires States Members to hold national tripartite consultations on any proposed reform of the law. The statutes/rules of El Salvador’s Higher Labour Council, which is a tripartite body, stipulate that the Council must be consulted on any proposed new law prior to its introduction. However, no formal or informal tripartite consultations of the workers’ and employers’ organizations within the Council has been held on the proposed reform of 19 laws, and this violates both the letter and the spirit of ILO Convention No. 144, as well as of the law establishing the Higher Labour Council as the designated consultative body.
6. 308. The ANEP adds that the proposed reform of 19 laws on official autonomous institutions, so as to restrict the free exercise of the employer sector’s right to appoint its representatives on the management boards of such institutions as the Social Security Institute (ISSS) and the Social Housing Fund (FSV), undermines the sector’s representative capacity. The ANEP recalls that, under article 19, paragraph 5(d), of the ILO Constitution, a State Member that ratifies a Convention commits itself to take such action as may be necessary to make its provisions effective, that is to say the State is under an obligation not just to include the Convention in the country’s domestic legislation but also to ensure its implementation in practice.
7. 309. The application of ILO Conventions Nos 87, 98, 142 and 144 entails the conduct of tripartite consultations on any proposal to reform the Social Security Act, the Social Housing Fund Act, etc., and it is thus a fundamental responsibility of the State to consult the sectors concerned before introducing any such reform.
8. 310. The ANEP states that its complaint against the State and Government of El Salvador is presented on the grounds that they are violating the provisions of ILO Conventions Nos 87, 98, 142 and 144 and infringing the Association’s right to appoint its representatives freely in 19 autonomous institutions (notably the ISSS, the FSV, etc.), and that the public authorities are guilty of acts of interference in that they are promoting legislative reforms that violate the principle of the independence of employers’ organizations in the exercise of their activities, the principle whereby the State is required to hold tripartite consultations before introducing legislative reforms and the principle of equity in the membership of tripartite bodies.
9. 311. Among the reforms it challenges, the ANEP includes that of the National Institute for Vocational Training (NIVT), which the Committee on Freedom of Association has already examined at its March 2013 meeting [see 367th Report, Case No. 2930].

B. The Government’s reply

1. 312. In its response to the ANEP’s complaint, the Government states in a communication dated 26 February 2013 that on 16 August 2012 the President of the Republic, through the Ministry of Labour and Social Welfare, sent three communications calling on the Legislative Assembly to introduce three draft legislative decrees revising the Vocational Training Act (examined by the Committee on Freedom of Association in a previous case), the Social Security Act and the Social Housing Fund Act.
2. 313. The Government states that the constitutional basis and grounds for the proposed legislative decrees can be found in article 133.2 of the Constitution of El Salvador, which empowers the President of the Republic to introduce legislation through the government ministries, and in article 168.15 of the Constitution, which confers on the President the responsibility and obligation to ensure the efficient management and conduct of public affairs. The proposed legislative reforms are designed to establish a legal mandate for the public administration to select the most competent officials from the private sector by broadening and diversifying the number of the appointees so as to enhance the participation and representation of the employer sector in official autonomous institutions such as the ISSS and the FSV, in full compliance with the President’s constitutional powers and duties.
3. 314. The Government notes that, far from reducing the employer sector’s participation in the said institutions’ management boards, the proposed reforms are designed to broaden, democratize and enhance the representativity of the various branches of private enterprise in official autonomous institutions. The institutions will continue to be autonomous, that is to say they will retain their juridical personality, their own assets and their technical, administrative and financial independence, in accordance with the terms of the Acts under which they were created, but they will be subject to the authority, management and guidance of the central administration so as to be able to provide the community rapidly, appropriately and efficiently with the public services called for under their respective mandates.
4. 315. Regarding the ANEP’s allegation that the proposed reforms violate ILO Conventions Nos 87, 98, 142 and 144 by undermining the ANEP’s right to appoint its representatives freely on 19 autonomous institutions (notably the ISSS and the FSV), the Government considers that the complainant’s claims have no basis in fact and are irrelevant, inasmuch as the proposals are made in the legitimate exercise of the President’s attributions and responsibilities under article 168.15 of the Constitution, where they are defined as including “the efficient management and conduct of public affairs”.
5. 316. The Government concludes that the international labour standards ratified by El Salvador have not been violated and, in so far as the complainant’s allegations have in its opinion no basis in fact, requests that Case No. 2980 be dismissed.

C. The Committee’s conclusions

1. 317. The Committee observes that in the present complaint the ANEP alleges that, without consulting the Higher Labour Council (national tripartite body), the President of the Republic presented the Legislative Assembly with a proposal to reform 19 basic laws on official autonomous institutions in areas that affect the interests of the employers’ sector (notably the ISSS, the FSV, etc.) and that the proposed reforms would empower the President to appoint the employers’ and workers’ representatives on the institutions’ management boards. The ANEP states that this is an infringement of the right of employers’ organizations to elect their representatives freely, of the principle of non interference by the authorities in the exercise of their activities, of the principle of independence of employers’ organizations and of the principle of tripartite consultation and of equity in the membership of bipartite and tripartite bodies, in violation of ILO Conventions Nos 87, 98, 142 and 144 ratified by El Salvador.
2. 318. The Committee takes note of the Government’s statement in its reply that: (1) the President’s right to propose legislation is recognized by the Constitution, as is its responsibility and obligation to ensure the efficient management and conduct of public affairs (article 168.15 of the Constitution), and the Government therefore considers that the President’s action falls within his legitimate powers and that ILO Conventions Nos 87, 98, 142 and 144 have not been violated; (2) in order to fulfil the said obligation effectively, the President’s proposed reforms are designed to enable the public administration to select the most competent officials from the private sector by broadening and diversifying the number of appointees so as to enhance the participation and representation of the employer sector in official autonomous institutions; and (3) the purpose of the proposed reforms is to broaden, democratize and enhance the representativity of the various branches of private enterprise in official autonomous institutions.
3. 319. The Committee concludes from the Government’s reply that: (1) the proposed reform of 19 laws on autonomous institutions (the ISSS, the FSV and the NIVT) which the Executive presented to the Legislative Assembly were not submitted to the Higher Labour Council so that it could hold the prior consultations provided for in the law establishing this tripartite body; and (2) the Government recognizes that the proposed reform enables the public administration to appoint the representatives of the private sector, which it justifies by the reform’s objective of enhancing the representativity of the various branches of private enterprise in official autonomous institutions. In these circumstances, the Committee can only conclude that the legislative proposals in question are in grave conflict with the principle of autonomy, the principle of non interference by the authorities in the activities of employers’ and workers’ organizations, the right of those organizations to elect their representatives freely and the principle of prior tripartite consultation in matters of legislation, and that they therefore constitute a direct and serious violation of ILO Conventions Nos 87, 98, and 144. The Committee deplores this situation.
4. 320. Given the circumstances, the Committee draws the Government’s attention to the principle that tripartite consultation should take place before the Government submits a draft to the Legislative Assembly or establishes a labour, social or economic policy and to the importance that the introduction of draft legislation affecting collective bargaining or conditions of employment should be preceded by full and detailed consultations with the appropriate organizations of workers and employers [see Digest of decisions and principles of the Freedom of Association Committee, fifth (revised) edition, 2006, paras 1070 and 1075]. The Committee has emphasized the importance that should be attached to full and frank consultations taking place on any questions or proposed legislation affecting trade union rights [see Digest, op. cit., para. 1074], and recalls that the process of consultation on legislation helps to give laws, programmes and measures adopted or applied by public authorities a firmer justification and to ensure that they are well respected and successfully applied; the Government should seek general consensus as much as possible, given that employers’ and workers’ organizations should be able to share in the responsibility of securing the well-being and prosperity of the community as a whole, this being particularly important in light of the growing complexity of the problems faced by societies and of the fact that no public authority can claim to have all the answers or assume that its proposals will naturally achieve all of their objectives [see Digest, op. cit., para. 1076]. The Committee calls upon the Government to abide by these principles fully in the future.
5. 321. Consequently, the Committee requests the Government to ensure that the representatives of workers’ and employers’ organizations on tripartite bodies are appointed by them freely, and that in-depth consultations are urgently held with those organizations within the Higher Labour Council, so that mutual agreement can be reached on ensuring the balanced tripartite composition of the management boards of the autonomous institutions referred to in the complaint (notably the ISSS, the FSV and the NIVT), and that the shared decision so reached is submitted without delay to the Legislative Assembly in the course of its examination of the legislative reform previously proposed by the Government.

The Committee’s recommendations

1. 322. In the light of the foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee draws the attention of the Government to the principles set out in its conclusions with respect to the free appointment of employers’ representatives and to tripartite consultation, and requests the Government to respect those principles fully in the future.
   • (b) The Committee requests that the Government urgently conduct in-depth consultations with the workers’ and employers’ organizations within the Higher Labour Council so that mutual agreement can be reached on ensuring the balanced tripartite composition of the management boards of the autonomous institutions referred to in the complaint (notably the ISSS, the FSV and the NIVT), and that the shared decision so reached be submitted without delay to the Legislative Assembly in the course of its examination of the legislative reform previously proposed by the Government.
   • (c) The Committee requests the Government to keep it informed of the developments in this regard.