Rapport définitif - Rapport No. 306, Mars 1997

Cas no 1889 (Brésil) - Date de la plainte: 28-MAI -96 - Clos

Allegations: Application of fines exceeding the payment capacity of trade unions for holding strikes

1. 152. The complaint was submitted in communications from the Single Confederation of Workers dated 28 May and 21 October 1996. The Government sent its observations in communications dated 19 December 1996 and 28 January 1997.
2. 153. Brazil has not ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), however it has ratified the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainant's allegations

1. 154. In its communications of 28 May and 21 October 1996, the Single Confederation of Workers (CUT) recalls that in May 1995 the Supreme Labour Tribunal declared abusive (illegal) the strike held within the framework of the collective bargaining process in the PETROBRAS oil company and imposed the working conditions to be respected by the parties (this action was considered by the Committee on Freedom of Association as a violation of the right to strike, bearing in mind the circumstances of the case (see 300th Report, Case No. 1839, para. 86). The CUT adds that following the pursuance of the strike, the Supreme Labour Tribunal imposed on each trade union affiliated to the Single Federation of Oil Workers (FUP) a fine of US$100,000 for each day of strike, which given the duration of the strike made a total of US$2 million. This astronomic amount exceeded the payment capacity of the trade unions in question, preventing them from: using the dues paid by their members; fulfilling their economic obligations; paying their employees and carrying out their trade union activities.
2. 155. The CUT adds that although the National Congress approved an amnesty law absolving the trade unions from paying the above-mentioned fines, the President of the Republic vetoed this law on 1 April 1996.
3. 156. Furthermore, the CUT alleges that the Government has sent a Bill (1802/96) to the National Congress which amends the Act respecting strikes, in particular as regards essential activities. This Bill limits collective bargaining by authorizing the judiciary to intervene in interest disputes between employers and trade unions, through the exercise of the standard-setting power of the labour courts, by submitting such disputes to a compulsory settlement, and it expressly provides that the judicial authority shall apply fines to trade unions engaging in strikes deemed as "abusive", thus regulating the fines already imposed on the trade unions by the courts.
4. 157. The CUT objects in particular to the following provisions of the proposed text of Bill No. 1802/96:
   • Section 11
   • Paragraph 2. In the event that a collective labour dispute which has resulted in a strike is placed before the Tribunal, the President of the Tribunal responsible for its examination may immediately issue a judicial order establishing the conditions and percentage of employees who must remain at work during the stoppage, with a view to complying with the provisions stated at the beginning of this section, and which shall vary in accordance with the nature of the work in the production section in question.
   • Paragraph 3. The judicial order respecting the unavoidable needs of the community, the infringement of which by any of the parties shall result in a daily fine of up to 500 minimum wages, shall remain in force:
     • (a) until the date of the ruling on the dispute, if the strike is declared abusive;
     • (b) until the end of the strike movement, if the strike is considered as not abusive.
   • Paragraph 4. In the event of failure to comply with the order, the legitimate party may, and the Ministry of Labour must, take steps with the Tribunal for the payment of the fine.
   • Section 16
   • If the strike is declared abusive by the Tribunal, the latter shall order the immediate return to work of the strikers, and warn the trade union that in the event of non-compliance with the decision a daily fine shall be imposed which in any case shall not exceed 1,000 minimum wages for each day that the strike movement continues.
   • Paragraph 1. In determining the amount of the fine, the Tribunal shall take into account the economic and financial capacity of the trade union and the social and economic consequences of non-compliance with the decision.
   • Section 17
   • If the Tribunal has declared the strike abusive and imposed the fine, it may suspend its payment, in whole or in part, for a period of up to five years, at the request of the interested party or at the request of the Public Ministry of Labour, once the situation has returned to normal.
   • Paragraph 1. Once the time-limit stipulated at the beginning of this section has elapsed without the trade union organization having engaged in any abusive strike, the competent court may order the cancellation of the fine at the request of the trade union concerned.
   • Paragraph 2. Proceedings shall be engaged for the full payment of the fine in the event that an abusive strike is held within the time period established at the beginning of this section.
   • Section 2
   • Trade unions subject to the execution of a fine imposed by judicial decision within the framework of a collective labour dispute which has resulted in a strike may apply to the Tribunal which applied the sanction to request that such fines be adapted to the criteria and limits established in section 16 and the suspension of the application of the fines under the provisions of section 17 ...
   • Section 3
   • This Act shall come into force on the day of its publication.
5. 158. Finally, the CUT requests that a recommendation be made to the Government to withdraw the proposed text of Bill No. 1802/96 and to annul the standard-setting power of the courts in cases of collective labour disputes resulting in strikes since at present such disputes are subject to compulsory settlement.

B. The Government's reply

1. 159. In its communications of 19 December 1996, the Government states that Bill No. 1802/96, drafted by the Executive, is the result of the latter's commitment to introduce reforms to modernize the State and its institutions.
2. 160. The Government points out that during the strike by workers at the PETROBRAS enterprise in May 1995, the Supreme Labour Tribunal ordered the immediate return of the workers to their workplaces, following its ruling that the strike movement was unlawful, since it violated the standards in force respecting collective labour disputes, non-compliance with which would be subject to the payment of a fine of 100,000 reales per day by each member of the Single Federation of Oil Workers (FUP), which represented the workers. The imposition of this fine by the labour court, given the refusal of the workers to return to their workplaces, was intended to put an end to a strike movement which lasted a month and during which the civilian population suffered a shortage of fuel and cooking gas because of the non-maintenance of a minimum level of essential services.
3. 161. Following the application of the ruling made by the labour court, a number of representative trade union bodies of the workers of the enterprise which disregarded the ruling claimed that it compromised their financial situation.
4. 162. Bill No. 600 (placed before the National Congress by the Government following the recommendations of the Committee on Freedom of Association in Case No. 1839) granted an amnesty to the oil workers' trade unions in respect of the fines imposed by the labour courts following the strike movement of May 1995. After the Bill had been adopted by the National Congress, it was vetoed by the President of the Republic as being contrary to the public interest and to the respect of legal standards and judicial decisions. The precedent which would be created by the adoption of the above-mentioned Bill would have resulted in discrediting the legitimacy of the principles governing a democratic State based on the rule of law and called into question the harmonization of the powers of the State as established by the Constitution, which would be compromised by the disregard of decisions consistently adopted by the judiciary.
5. 163. In vetoing the above-mentioned Bill, the President of the Republic presented another Bill (No. 1802/96) which regulates more precisely the consequences of the abusive exercise of the right to strike, by establishing parameters for determining with greater legal clarity the responsibility of unions which promote work stoppages considered as abusive, particularly in those branches which provide the general public with essential services, in accordance with Act No. 7783/89. The President's message tacitly acknowledged the excessive nature of the sanction imposed by the Supreme Labour Tribunal by emphasizing that the Executive is not indifferent to the fact that trade union activity by the oil workers may not be possible as a result of the high amount of the fines imposed.
6. 164. Bill No. 1802/96 provided for a possible solution to the specific question of the fines imposed on the trade unions of workers of PETROBRAS and other trade unions by establishing parameters which must be respected by the labour courts in the fixing of fines, their payment and the possibility of suspending the application of such fines.
7. 165. The Bill took account of the situation of an occupational category which, following the application of a fine imposed under a judicial ruling which declared a strike abusive, made the exercise of trade union activity in a specific production sector unviable by providing that any trade union subject to such an order could under the Bill apply to the court which imposed the order for the sanctions to be adjusted and/or the payment of the fines to be suspended, in accordance with the economic capacity of the trade unions. This provision preserves the independence of and harmony between the powers of the Republic, which would have been seriously compromised if the National Congress had withdrawn from the Supreme Labour Tribunal its authority respecting the application of fines imposed as a result of the strike movement of May 1995.
8. 166. Bill No. 1802/96 introduces into Act No. 7783/89 (Act respecting strikes) certain practices which had already been adopted by the labour courts as regards the fixing of minimum percentages of staff who must remain at work and the conditions in which indispensable services are to be provided to meet the essential needs of the public in the event of strikes in essential services, and the imposition of fines and their application by the Public Ministry of Labour. In this way, the Bill before the National Congress is an attempt to promote a return to normal conditions in labour and trade union relations in the oil sector (including through the possible retroactive application of the provisions of the Bill) and goes beyond these immediate objectives by regulating more precisely the exercise of the right to strike guaranteed by the Constitution. The Bill offers a broader solution at the standard-setting level to the matter dealt with in the Bill vetoed by the President concerning the amnesty granted in respect of fines imposed on various trade union bodies by the Supreme Labour Tribunal.
9. 167. Although immunity with respect to the abuses committed on the pretext of the right to strike is contrary to the Constitution, the competence of the labour courts should nevertheless be circumscribed by legal parameters concerning the imposition of pecuniary sanctions on trade union bodies. The Bill provides for its full application to fines imposed before its publication. This is also the case as regards the limitation on the amount of the fine and the suspension of its application. This innovation allows the pecuniary sanction to be lifted once the industrial relations situation has returned to normal.
10. 168. In its communication of 28 January 1997, the Government indicates that the trade union organization's reference to the standard-stetting power of the labour courts as an instrument used against the workers is without basis. Consideration must be given to the nature of the collective disputes submitted to the assessment of the courts, determined as collective disputes, to which the workers, employers (and the public ministry in cases of the paralysis of essential activities) may have recourse and which require the assistance of the State to resolve those collective disputes where agreement or conciliation seems totally or partially impossible. The federal Constitution grants the labour courts the standard-setting power in order to establish rules and working conditions in the judgement of collective disputes, setting new conditions or working rules and respecting the limits imposed by the Constitution and the laws of the land. This is a result of the principle of jurisdiction which is a way of resolving conflicts through the intervention of the State in the judicial process where the concrete right is established, dictating to the parties the legal solution to the dispute. The standard-setting power should be interpreted in accordance with democratic principles (article 1), separation of powers (articles 2 and 49) and legality (article 5 II), all of which are provided for in the federal Constitution. As concerns strikes in cases where a collective rights dispute has been declared, or when submitted to the judiciary, it must be determined whether the strike is or is not abusive. Where a strike has been declared abusive taking into account the violation of the provisions of Act No. 7783/89 sanctions are provided where the workers have not returned to the workplace and recommenced negotiations.
11. 169. The Government adds that the standard-setting power, contrary to what was said by the complainant organization, has limits established in the federal Constitution. When the labour courts exercise this standard-setting power it has executed an exclusively judicial activity. When judging collective disputes, existing standards in positive law must be observed, thus the courts are exercising jurisdictional power given that they are applying a legal order. The limits established by the Constitution prohibit the judiciary from exercising a legislative activity due to the principle of the separation of powers. When exercising the standard-setting power, it must assure private property, the equality of rights, the social function of private property, the objective of full employment, free enterprise, the value of human work and the dictates of social justice. The standard-setting power is exercised within the limits of the law, given that no one is required to do or not to do any act by virtue of the law (article 5 II). This means that the standard-setting power cannot be exercised if there is no legal provision for it. In this way, the standard-setting power cannot touch upon matters not provided for in the law. The standard-setting power establishes rules through a judgement dictated by a competent body, in the present case, the section on collective disputes of the Supreme Labour Tribunal, composed of lawyers and representatives of workers and of employers. Similarly, the standard-setting power enables the establishment of applicable standards according to which the competent body will determine the qualification of a strike, in the present case, part of the section of collective disputes, which includes among its members representatives of workers, of employers and lawyers.
12. 170. Like all draft legislation, Bill No. 1802/96 may be subject to amendments during its passage through the committees of the National Congress. It is the responsibility of society, as represented by the National Congress, to decide upon its appropriateness, adaptation and timeliness, by introducing amendments considered necessary for its adoption and subsequent submission to presidential approval.

C. The Committee's conclusions

1. 171. In this case, the complainant organization alleges the imposition of fines on trade unions affiliated to the Single Federation of Oil Workers (FUP) participating in strikes in the PETROBRAS enterprise in 1995 and which exceeded the payment capacity of the trade unions; the veto by the President of the Republic of an Act (No. 600) adopted by the National Congress which granted an amnesty in respect of these fines; the presentation of a Bill (No. 1802/96) which regulates the imposition of fines for strikes deemed abusive or illegal by the judicial authority and which, according to the complainant, contains provisions which are contrary to freedom of association and which subject collective disputes of interest to the judicial authority.
2. 172. As regards the fines imposed by the judicial authority on the trade unions affiliated to the Single Federation of Oil Workers (FUP) following the strikes held in the PETROBRAS enterprise in 1995 after a compulsory judicial settlement, the Committee notes that the total amount of the fines is very high and that the Government recognizes that this high amount may make the trade union activity of the workers impossible. The Committee would like to refer to the conclusions which, within the framework of Case No. 1839, it reached at its meeting of November 1995 concerning this labour dispute and strike of oil workers and the submission of disputes to the judicial authority, which are reproduced below (see 300th Report, paras. 86 and 87):
   • With regard to the violation of the principle of collective bargaining in the dispute under examination, the Committee observes that according to the complainant the strike commenced on 27 September 1994 pursuant to the enterprise's rejection of the union's main demands and that the Government states that three days later, on 30 September 1994, the Supreme Labour Tribunal established the working conditions to be respected by the parties (and, as a consequence, the workers on strike were to return to work immediately as required by legislation). The Government also declared that subsequently, on 9 May 1995, the enterprise submitted the collective dispute to the Supreme Labour Tribunal. Moreover, the complainant indicated in this context that neither the Government nor PETROBRAS had respected the terms of the relevant agreements (appended to the complaint) that they had signed with the Single Federation of Oil Workers on 10 and 25 November 1994 (the latter agreement was subsequently to be termed by the Supreme Labour Tribunal as a "protocol of intent" and declared legally invalid). Irrespective of these texts, the Committee must emphasize that, three days after the strike broke out and as the movement was continuing, the Supreme Labour Tribunal imposed working conditions to be respected by the parties thus rendering the strike activity illegal. On this score, the Committee wishes to recall the principle that "a provision which commits either party unilaterally to request the intervention of the labour authority may effectively undermine the right of workers to call a strike ... and does not promote voluntary collective bargaining" (cf. 265th Report, Cases Nos. 1478 and 1484 (Peru), para. 547, and 295th Report, Case No. 1718 (Philippines), para. 296). In these circumstances, the Committee considers that the action taken violated the right to strike. It requests the Government to take measures to amend legislation so that the submission of collective interest disputes to the judicial authorities is only possible by common agreement between the parties or in the case of essential services in the strict sense of the term (the interruption of which may endanger the life, personal safety or health of the whole or part of the population).
   • Moreover, the Committee urges the Government to guarantee that collective agreements between management and unions be respected. It also requests the Government to encourage the social partners to resolve collective disputes by means of collective bargaining.
3. 173. The Committee recalls that, in this case, it had concluded that the Government acted in violation of the principles of freedom of association by putting an end to the strike in the PETROBRAS enterprise. In these circumstances, the Committee concludes that the imposition of fines for the exercise of the right to strike in the circumstances of the present case is not consistent with the principle of freedom of association, in particular bearing in mind that the Government recognizes that the high amount of the fines may make trade union activity impossible. The Committee stresses that no fine or sanction should be imposed against the unionists in question. The Committee also notes that, in line with the previous recommendations of the Committee, the Government presented a Bill (No. 600) to the National Congress which granted an amnesty in respect of the fines (subsequently vetoed by the President of the Republic who invoked the respect of the decisions of the judiciary and the protection of the principles of a democratic State based on the rule of law). The Committee insists that the Government take the necessary measures to ensure that these fines are annulled. Furthermore, the Committee notes the Government's statement concerning the circumstances in which the standard-setting power of the labour courts would be exercised. In the Committee's opinion, this procedure is not incompatible with the principles of freedom of association to the extent that it concerns essential services in the strict sense of the term. The Committee reiterates the request already made at its meeting of November 1995 for the Government to take measures to amend legislation to ensure that the submission of collective interest disputes to the judicial authorities is only possible by common agreement between the parties or in the case of essential services in the strict sense of the term (the interruption of which may endanger the life, personal safety or health of the whole or part of the population).
4. 174. As regards Bill No. 1802/96 which regulates and establishes criteria concerning the imposition of fines in the event of abusive or legal strikes, which the Executive sent to the National Congress, the Committee notes that according to the Government the Bill establishes parameters for determining with greater legal clarity responsibilities in the case of abusive stoppages in the essential services mentioned in the legislation, in particular bearing in mind that the high amount of the fines imposed by the judicial authorities might make trade union activity impossible. The Committee also notes that in the light of the resulting situation, the Bill provides that fines may be adjusted in accordance with the economic capacity of the trade unions and may be suspended and cancelled after five years if the trade union body has not carried out any other abusive strike (for example, failure to comply with the provision respecting minimum services).
5. 175. The Committee would like to emphasize that the imposition of sanctions, including fines, on the social partners in the case of infringement of labour legislation is not in itself a matter of objection; however, such sanctions must be proportionate to the seriousness of the infringement committed and must in no case compromise the continuation of the activities of the parties thus sanctioned. Similarly, the Bill should not provide for fines or sanctions in cases of legitimate strike action. In this respect, the Committee believes that fines which are equivalent to a maximum amount of 500 or 1,000 minimum wages per day of abusive strike may have an intimidating effect on trade unions and inhibit their legitimate trade union activities, and that such an effect would also occur if - as is also provided for in this Bill - the cancellation of a fine of this kind is subject to the provision that no further strike considered as abusive is carried out. For this reason, the Committee requests the Government to consult with the social partners on the content of Bill No. 1802/96 and hopes that the results of these consultations and the above-mentioned principles will be taken into account in the final text of the Act.

The Committee's recommendations

1. 176. In the light of the foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee insists that the Government take measures to ensure that the fines imposed on the trade unions of the Single Federation of Oil Workers (FUP) for their participation in strikes in the PETROBRAS enterprise in 1995 are annulled.
   • (b) The Committee requests the Government to take the necessary measures so that the Bill which is presently being examined by the National Congress does not provide for fines or sanctions in the case of legitimate strike action. In this respect, considering that some provisions of Bill No. 1802/96 may have an intimidating effect on trade unions and inhibit their legitimate trade union activities, the Committee requests the Government to consult with the social partners on the content of Bill No. 1802/96 and hopes that the final text will take into account the results of these consultations and the principles set forth in the conclusions.
   • (c) The Committee once again requests the Government to take measures to amend the legislation so that the submission of collective interest disputes to the judicial authorities is only possible by common agreement between the parties or in the case of essential services in the strict sense of the term (the interruption of which may endanger the life, personal safety or health of the whole or part of the population).