Protection of Wages Convention, 1949 (No. 95) - Armenia (Ratification: 2004)

Direct Request (CEACR) - adopted 2017, published 107th ILC session (2018)

In order to provide a comprehensive view of the issues relating to the application of the ratified Conventions on wages, Convention No. 131 (minimum wage) and Conventions Nos 95 and 173 (protection of wages), the Committee considers it appropriate to examine them together.

The Committee notes the observations of the Confederations of Trade Unions of Armenia (CTUA) on Convention No. 131, Convention No. 95 and Convention No. 173, communicated with the Government’s reports.

Minimum wage

Minimum Wage Fixing Convention, 1970 (No. 131)

Articles 3 and 4 of the Convention. Criteria for the determination of the minimum wage level and consultations for the operation and modification of the system of minimum wage. The Committee notes that, in reply to previous observations of the Republican Union of Employers of Armenia (RUEA) and the International Organisation of Employers (IOE) concerning the absence of consideration of economic factors in the determination of the minimum wage level and the absence of full consultation of the employers’ organizations, the Government indicates that, following the adoption of the National Collective Agreement for 2015–18 by the Republican Tripartite Commission, a new methodology for the determination of the minimum wage has been developed in consultation with the CTUA and the RUEA. The Committee notes that the methodology transmitted by the Government in its report takes into account the criteria listed in Article 3. It also notes the Government’s indication that the draft modifications of the minimum wage level are communicated to the social partners for comments. Finally, it notes that, following a request from the Government in May 2017, the country is receiving technical assistance from the Office on the application of the Convention. The Committee requests the Government to provide information on developments in this respect.

Informal economy. In its observations, the CTUA indicates that the methodology for the determination of the minimum wage does not address the extensive problem of the informal economy. The Committee requests the Government to provide its comments in this respect.

Protection of wages

Protection of Wages Convention, 1949 (No. 95)

Article 2 of the Convention. Application to public officials and public servants. The Committee notes that section 181 of the Labour Code provides that the procedures and conditions of remuneration of public officials and public servants shall be prescribed by law. The Committee also notes the adoption of Law HO-157-N of 12 December 2013 on the remuneration of persons holding public offices, which is not available in English. The Committee therefore requests the Government to indicate whether provisions of this Law ensure that public officials and public servants benefit from the protection of the Convention, and if this is not the case, how effect is given to the Convention for this category of workers.

Article 3(1). Prohibition of payment in a form other than legal tender. The Committee notes that pursuant to section 192(2) of the Labour Code, the payment of wages in the form of securities or commitments is prohibited, except in the cases prescribed by law. The Committee requests the Government to provide information on the cases, if any, in which the law authorizes the payment of wages in the form of securities or commitments.

Articles 6 and 7. Freedom of workers to dispose of their wages. The Committee notes the Government’s indication that these Articles of the Convention are directly applicable to the national legal order by virtue of the ratification of the Convention.

Article 14(a). Information of workers in cases of changes in their wages. The Committee notes that section 194 of the Labour Code – pursuant to which the employer was requested to notify the workers in writing before changes in their conditions or remuneration occurred as a result of changes in the law or in collective agreements – was repealed by Law HO-96-N of 22 June 2015. Therefore, the Committee requests the Government to provide information on whether measures have been taken to ensure that workers are informed in cases of changes in their wages, in accordance with Article 14(a) of the Convention.

Article 15(d). Wage records. In its previous comments, the Committee requested the Government to adopt measures to ensure that adequate wage records are maintained in an approved form and manner. It notes the information provided by the Government that under Government Decision No. 1676-N, workers may request an excerpt from their individual account in the database of the Personal Registration of Income Tax and Social Payments. These excerpts include the information that employers are required to provide to the tax authorities on the workers’ income, and on the tax and social contributions applied. Recalling that the maintenance of wage records also serves to facilitate the work of labour inspectors, the Committee requests the Government to indicate whether and how labour inspectors have access to wage records.

Protection of Workers’ Claims (Employer’s Insolvency) Convention, 1992 (No. 173)

Article 6 of the Convention. Protection of workers’ claims by means of a privilege. In its previous comments, the Committee requested the Government to clarify whether the privilege for wage claims provided for under the Bankruptcy Act of 25 December 2006 covered all the claims listed under Article 6. The Committee takes note of the Government’s indication that the list of claims covered by the privilege is found in Government Decision No. 853-N of 8 August 2013, which includes all the claims listed in Article 6.

Articles 9–13. Protection of workers’ claims by means of a guarantee institution. In its previous comments, the Committee requested the Government to provide information on the progress made for the establishment of a wage guarantee institution. In its observations, the CTUA indicates that the absence of a wage guarantee institution increases poverty and fosters the development of the informal economy. The Committee takes note of the Government’s indication that the establishment of a wage guarantee institution would be inappropriate under the country’s current phase of socio-economic development, as it would excessively burden the employers’ financial capacity and undermine employment creation. The Committee invites the Government to take advantage of the technical assistance that the country is receiving from the Office in order to make progress towards the creation of a wage guarantee institution, in accordance with the Convention. It requests the Government to provide information on progress made in this respect.

Enforcement

Sanctions and labour inspection. With reference to its comments under the Labour Inspection Convention, 1947 (No. 81), the Committee requests the Government to provide specific information on the measures taken to inspect compliance with the national provisions on minimum wage and protection of wages, and on the sanctions adopted in cases where violations have been identified, if any. It also requests the Government to provide information on the provisions of the national legislation which contain the possible sanctions in this respect.

Direct Request (CEACR) - adopted 2011, published 101st ILC session (2012)

Article 4 of the Convention. Partial payment of wages in kind. The Committee notes with interest the Government’s indication that the Remuneration Act of 2001, which allowed up to 20 per cent of the employee’s wages to be paid in the form of manufactured goods produced by the employer (with the exception of alcoholic drinks, drugs and materials with harmful toxic, radioactive and strong effects), has now been formally repealed by Act No. 119 of 24 June 2010.

Article 6. Freedom of workers to dispose of their wages. Further to its previous comment, the Committee notes the Government’s indication that this principle of the Convention is reflected in article 31 of the Constitution which guarantees the right to freely own, use, dispose of and bequeath one’s property. The Committee wishes to refer, in this regard, to paragraph 178 of its 2003 General Survey on the protection of wages, in which it recalled that it is necessary for implementing legislation to contain an express provision generally by prohibiting employers from restricting the freedom of workers to dispose of their wages and took the view that statements to the effect that the freedom of workers to dispose of their wages is a natural consequence of the right to property guaranteed in civil law are not sufficient to give effect to the requirements of this Article of the Convention, however necessary this protection of the right to property may be. The Committee accordingly requests the Government to take appropriate action to ensure that full effect is given to this provision of the Convention.

Article 7. Works stores. The Committee notes the Government’s statement that this Article of the Convention is directly applicable to the national legal order by virtue of the ratification of the Convention. In this connection, the Committee observes that not all provisions of international labour Conventions are self executing and often require specific measures by the competent authorities for their implementation. Therefore, while noting the Government’s explanations that, in practice, workers are free from any coercion whatsoever and company stores offer significant discounts to their workers and members of their families, the Committee requests the Government to consider adopting measures in order to regulate the operation of works stores in accordance with the requirements of this Article of the Convention.

Article 13. Place of payment of wages. The Committee notes the Government’s indication that despite the absence of a specific legal provision to this effect, wages in practice are paid at the workplace unless they are directly transferred to the employee’s bank account. The Committee wishes to refer, in this regard, to paragraph 413 of the abovementioned General Survey in which it noted that the safeguards laid down in the Convention prohibiting the payment of wages in taverns, places of amusement and also in shops or stores, may appear somewhat less relevant today in most of the more developed countries, especially in view of the increasing use of non-cash methods of payment, such as direct bank transfers. But these provisions are undoubtedly still relevant in the context of other countries, notably with regard to labour remuneration practices concerning agricultural workers. The Committee accordingly trusts that the Government will continue to monitor the situation and, if necessary, take further measures to secure the observance of this provision of the Convention.

Article 15(d). Wage records. Further to its previous comment, the Committee notes the Government’s indications about the system created under Decision No. 938 of 12 May 2005, whereby the State Social Security Service of the Ministry of Labour provides, twice a year, personalized information to every insured employee about the amounts of salaries received and taxes paid. The Committee observes, however, that the maintenance of wage records prescribed by this Article of the Convention serves not only to make possible the issuance of pay slips so as to keep the workers informed but also to facilitate the work of labour inspectors. The Committee therefore requests the Government to indicate the measures taken or envisaged to ensure that adequate wage records are kept in an approved form and manner, as required under this Article of the Convention.

Part V of the report form. Practical application. The Committee notes the statistical information provided by the Government concerning labour inspections carried out between 2008 and 2010 and cases of non-payment of wages reported. The Committee requests the Government to continue providing the information concerning the application of the Convention in practice, including, for instance, statistics on the number of workers covered by relevant legislation, copies of collective agreements containing clauses on pay conditions, inspection results showing the number of wage-related offences recorded and the sanctions imposed, and copies of official studies or surveys addressing wages issues.

Direct Request (CEACR) - adopted 2007, published 97th ILC session (2008)

The Committee notes with interest the Government’s first report on the application of the Convention and wishes to draw its attention to the following points.

Article 4 of the Convention. Partial payment of wages in kind. The Committee notes that according to the Government’s report, the Remuneration Law of 2001 allowed up to 20 per cent of the employee’s wages to be paid, with his/her written consent, in the form of manufactured goods produced by the employer (with the exception of cigarettes, alcoholic drinks, drugs and materials with harmful, toxic, radioactive and strong effects). The Government indicates, however, that those provisions of the Remuneration Law are no longer valid as they are in contradiction with the Labour Code which was adopted in 2004. Noting that the Labour Code does not set out an express prohibition against the payment of wages in kind and also noting that the Labour Code does not contain any final provisions on the repeal of specific laws or regulations, the Committee would appreciate receiving additional explanations on the status of the Remuneration Law of 2001 and current practice concerning the payment of wages in kind.

Article 6. Freedom of workers to dispose of their wages. The Committee notes that the general labour legislation does not appear to contain any provision explicitly prohibiting employers from limiting the workers’ freedom to dispose of their wages. It therefore requests the Government to provide additional explanations as to how effect is given to this Article of the Convention.

Article 7. Works stores. The Committee notes that there seems to exist no specific provision to ensure that workers are free from any coercion to use works stores, and that goods and services at works stores are provided at fair and reasonable prices for the benefit of the workers concerned. It therefore requests the Government to indicate whether and how the operation of works stores is regulated.

Article 10. Assignment of wages. Noting that section 213 of the Labour Code refers to attachment but not assignment of wages, the Committee requests the Government to indicate the legal provisions, if any, that set out the conditions under which and the extent to which wages may be assigned.

Article 13. Place of payment of wages. The Committee notes that the Labour Code provides for wages to be paid on working days but it does not contain any provisions on the place of payment. It therefore requests the Government to specify how it is ensured that wages are paid at or near the workplace, and that payment is prohibited in places of amusement or retail stores, as required under this Article of the Convention.

Article 14(d). Wage records. The Committee notes that section 90 of the Labour Code provides for a workbook which nonetheless is not meant to contain any remuneration-related information or wage data. It also notes, however, that section 193(1) of the Labour Code provides for itemized pay statements which presuppose the maintenance of detailed payroll records. The Committee would therefore be grateful if the Government would provide additional information on the form and manner wage records are kept.

Part V of the report form. The Committee would be grateful if the Government would supply in its next report general information, including available statistics, copies of official documents such as annual reports of the State Labour Inspectorate, and extracts from inspection reports, concerning the manner in which the Convention is applied in practice.