Report in which the committee requests to be kept informed of development - Report No 333, March 2004

Case No 2284 (Peru) - Complaint date: 05-JUN-03 - Closed

Allegations: The complainants allege that the decision made by the SEDAPAL S.A. enterprise to end its contract with the CONCYSSA S.A. enterprise will lead to mass dismissals and the dissolution of SUTOPEC

1. 849. The complaint is contained in a joint communication dated 5 June 2003 from the General Confederation of Workers of Peru (CGTP), the National Federation of Water and Sewerage Workers of Peru (FENTAP) and the Single Trade Union of Water and Sewerage Control Workers (SUTOPEC). The Government sent its observations in communications dated 2 October 2003 and 9 January 2004.
2. 850. Peru 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 complainants’ allegations

1. 851. In their joint communication of 5 June 2003, the General Confederation of Workers of Peru (CGTP), the National Federation of Water and Sewerage Workers of Peru (FENTAP) and the Single Trade Union of Water and Sewerage Control Workers (SUTOPEC) allege that under the previous Government, the Lima Water and Sewerage Company (Servicio de Agua Potable y Alcantarillado de Lima, SEDAPAL S.A.) invited service providers to submit tenders for work relating to its main activity, with the aim of shirking responsibilities towards its own workers. In this context, CONCYSSA S.A. was awarded the contract, which hired workers on a fixed term-basis. These workers, who were afraid of not being re-hired and had contracts of a maximum of three months, did not exercise the right to organize or, therefore, the right to collective bargaining.
2. 852. The complainants add that once the new Government came into office, workers managed to establish their trade union, which was duly registered by the labour authority. It is currently a legal trade union organization belonging to the branch of intermediary activities, but it conducts most of its activities at SEDAPAL S.A.
3. 853. The complainants indicate that SEDAPAL S.A. decided to end its contract with CONCYSSA S.A., and envisaged ending its agreement with the GRAÑA Y MONTERO S.A. enterprise. According to the complainants, this will lead to the dismissal of over 1,380 workers and the dissolution of the trade union.
4. 854. Lastly, the complainants state that SUTOPEC requested the intervention of the Ministry of Labour in order to safeguard their rights, but they are not confident that the Ministry of Labour will defend their rights (the complainants sent a copy of the complaint filed with the legal authority objecting to the externalization of services at SEDAPAL S.A.).

B. The Government’s reply

1. 855. In its communications of 2 October 2003 and 9 January 2004, the Government states that the SEDAPAL S.A. enterprise transmitted its comments concerning the complaint. It indicates that employment intermediation, which was governed by Presidential Decree No. 003-97-TR, the Unified Text of Legislative Decree No. 728 (Act on labour productivity and competitiveness), is currently governed by Act No. 27626 and its implementing regulation, Presidential Decree No. 003-2002-TR. These standards establish the conditions and limitations concerning the exercise of employment intermediation while safeguarding labour rights.
2. 856. The Government indicates that employment intermediation requires a user enterprise, an intermediary, and workers from both the former and the latter. The user enterprise and the intermediary have a civil relationship, whereas the intermediary and the workers it supplies to the user have an employment relationship. The Government indicates that these clarifications are of utmost importance insomuch as they explain and state that the ending of a contract between an intermediary enterprise and a user is a legal matter that, per se, does not have an effect on the employment relationship between the intermediary’s workers and the user. Therefore, it would be incorrect and inappropriate to maintain that, by ending its contract with CONCYSSA S.A., SEDAPAL S.A. had caused the dismissal of a large number of workers.
3. 857. Lastly, the Government adds that if the fact that the legal relationship between the aforementioned enterprises came to an end did not, per se, cause the dismissal of the intermediary’s workers, neither can it be stated that this led to the dissolution of the trade union organization established by these workers, since the union will continue to exist unless something occurs to cause its dissolution.

C. The Committee’s conclusions

1. 858. The Committee observes that the complainants allege that the decision made by the Lima Water and Sewerage Company (Servicio de Agua Potable y Alcantarillado de Lima, SEDAPAL S.A.) to end its contract with CONCYSSA S.A. will lead to mass dismissals and the dissolution of the Single Trade Union of Water and Sewerage Control Workers (SUTOPEC).
2. 859. The Committee notes that the Government refers to legislation governing employment intermediation and states that: (1) the ending of a contract between an intermediary enterprise and a user is a legal matter that, per se, does not have an effect on the employment relationship between the intermediary’s workers and the user, and it is therefore incorrect to maintain that by ending the contract, SEDAPAL S.A. (the user) caused the dismissal of a large number of workers, and (2) if the fact that the legal relationship between the enterprises came to an end did not, per se, lead to the dismissal of workers at CONCYSSA S.A. (the intermediary), neither can it be stated that this led to the dissolution of the trade union organization established by workers at SEDAPAL S.A.
3. 860. In this regard, the Committee observes that the complainants and the Government agree that the contract between SEDAPAL S.A. and CONCYSSA S.A. (with the latter providing the workers) would have ended. The Committee observes that the complainants have not alleged (neither does it emerge from the information provided) that the contract between the enterprises was ended for anti-union purposes. Furthermore, the Committee observes that the Government states that the trade union established at SEDAPAL S.A. has not been dissolved.
4. 861. However, the Committee observes that the complainants requested the intervention of the Ministry of Labour in order to safeguard their rights as regards this case, and that in March 2003 they appealed to the legal authority by filing legal criminal action objecting to the externalization of services at SEDAPAL S.A. In these conditions, considering that the information in the Committee’s possession does not allow it to determine whether this case concerns a matter of freedom of association, the Committee requests the Government to transmit all eventual decisions taken by the authorities concerning violations of freedom of association.

The Committee's recommendations

1. 862. In the light of its foregoing conclusions, the Committee requests the Governing Body to approve the following recommendation:
   • Considering that the information in the Committee’s possession does not allow it to determine whether this case concerns a matter of freedom of association, the Committee requests Government to transmit all eventual decisions taken by the authorities concerning violations of freedom of association.