With certain limitations, labor laws and regulations provide for freedom of association, protect the right to strike and bargain collectively, and prohibit antiunion discrimination and other forms of employer intimidation. Regulations allow workers to form unions on the basis of their occupation, employer affiliation, or geographic territory, without seeking prior authorization. However, the minimum membership required by law to form a union, 20 employees for a workplace-level union and 50 employees for a sector-wide union, is prohibitively high in some instances, particularly for small and medium-sized enterprises. The law also specifies that public- and private sector workers have the right to organize, bargain collectively, and strike, but it stipulates that the right to strike must be “in harmony with broader social objectives.”
Judges, prosecutors, and members of the police and military are not permitted to form or join unions. With the passage of Supreme Decree 065-2011 in July, there were advances to the rights to form unions and strike of more than 125,000 other public sector employees hired under administrative service contracts. The decree provides stronger guarantees of the right to unionize but does not address the concern that workers may not exercise their rights for fear of nonrenewal of their contract. The decree does not fundamentally change the nature of an administrative service contract, which is fixed term and renewable at the government agency’s discretion.
The law allows unions to declare a strike in accordance with their statutes. Private- and public sector union workers must give advance notice of a strike--at least five working days for private sector workers and 10 for the public sector--to employers and the Ministry of Labor. The law also allows nonunion workers to declare a strike with a majority vote as long as the written voting record is notarized and announced at least five working days prior to a strike.
Unions in essential public services, as determined by the government, are permitted to call a strike but must provide 10 working days’ notice, receive the approval of the Ministry of Labor, be approved by a majority (50 percent) of workers, and provide a sufficient number of workers during a strike to maintain operations, as jointly determined by the union and labor authorities on an annual basis. Workers who strike legally cannot be fired for striking, but illegal strikers in the private sector can be fired on the fourth day of absenteeism and public sector strikers after an administrative procedure.
Unless there is a preexisting labor contract covering an occupation or industry as a whole, unions must negotiate with companies individually. The law establishes processes for direct negotiations and conciliation. If those fail the workers can declare a strike or request arbitration. On September 17, the ministry issued Supreme Decree No. 014-2011-TR, which more specifically outlines the process that authorizes the use of arbitration to end collective labor disputes. The decree gives a party the ability to compel the other party to submit to arbitration (whether worker- or employer-initiated) binding on employers whenever either the parties cannot reach an agreement in their first collective bargaining negotiation, or a party acts in bad faith during collective bargaining by delaying, hindering, or avoiding an agreement. If the parties disagree over whether or not a prerequisite for binding arbitration has been met, the law also allows a party to submit the matter to independent, nongovernmental arbitrators for an initial decision. A provision from Law 29497 requires labor conflicts to be resolved in less than six months.
The law prohibits employers from refusing to hire an individual because of union membership and also prohibits other forms of antiunion discrimination. Workers fired for union activity have the right to reinstatement. However, the law allows companies to fire employees without justification if they offer severance pay as fixed by law. The law forbids businesses from hiring temporary workers to perform core company functions, requires businesses to monitor their contractors with respect to labor rights, and imposes liability on businesses for the actions of their contractors.
The government did not effectively enforce the law in all cases, and employers engaged in antiunion practices. The practice of subcontracting allowed employers to avoid direct employment relationships and the associated legal requirements. This also limited the size of the company workforce, thus making it more difficult to form a union. Law 29245 and its progeny tighten the legal requirements for subcontracting companies and, if those requirements are not met, impose upon the principal company a direct employment relationship with subcontracted workers. Nevertheless, anecdotal evidence suggested that the practical effect of the law was limited by its implementing regulations and the difficulties of labor inspections to detect outsourcing in the regions outside of Lima.
Employers continued to dismiss workers for exercising the right to strike. Dismissal of striking workers and delays in reinstatement of these workers, in both legal and illegal strikes, were the main repercussions that employers utilized to dissuade workers from going on strike. Workers faced prolonged judicial processes and lack of enforcement following strike-related dismissals. A local NGO reported that administrative issues at the Labor Ministry effectively negated a decree providing stronger protections for individuals hired under administrative services contracts who planned to unionize.
Labor conflicts were not always resolved within six months as required by law. Significant delays in the collective bargaining process due to employers’ lack of interest in concluding agreements proved to be a common obstacle to compliance with worker rights to bargain collectively. The national tax agency union (SINAUT) alleged that the government failed to uphold unions’ right to collective bargaining and denied workers’ requests to enter into arbitration after the government-employer and workers failed to agree on wages and other issues during earlier negotiations. The government noted that the public sector budget law forbids it from negotiating economic matters. Discussions on the collective bargaining and arbitration process continued at year’s end.
Unions were generally independent of government and political parties. According to labor leaders, permission to strike in both the private and public sectors was in some cases difficult to obtain. During the year the government declared 19 of 84 strikes legal. The Ministry of Labor justified its decisions to deem strikes illegal by citing union failure to fulfill the legal requirements. The International Trade Union Confederation noted that the law effectively legalizes unfair dismissals by allowing employers to fire workers without cause in return for severance pay.
Many businesses hired temporary or contract workers who were effectively barred from participating in those firms’ unions due to fear that their contracts might not be renewed. Employers also circumvented restrictions regarding hiring temporary workers to perform core company functions in a number of ways. For example, the Peruvian Mineworkers Federation (FNTMMSP) attributed the nonrenewal of the contracts of seven drivers employed by the subcontractor MAMUT Peru to their union membership. There were two favorable court decisions, but at year’s end the workers were awaiting their reinstatement. Subcontracting was used to limit workers’ right to organize and prevent the formation of formal employment relationships. The widespread use of subcontracting also made it more difficult to reach the 20-employee threshold necessary to form a union.
During the year the Textile Workers Union Federation (FTTP) reported violations of the Non-Traditional Export Regimen (Decree Law No. 22342-1978) in apparel manufacturing. In one example, on July 27, a judge from the Lima Constitutional Court No. 4 found that Texpop, S.A. failed to renew the contracts of 129 unionized workers, including two union leaders, in an action of antiunion discrimination. The judge found that many of these employees had been working for Texpop for up to a decade on short-term contracts. Notably, the judge also stated that the decree and its “exceptional” short-term contracting scheme were no longer necessary to support the growth of the country’s textile and apparel sector. Texpop had not complied with the court’s decision to reinstate the workers by year’s end.
Regulations had the effect of limiting the associational rights of workers in “nontraditional” export sectors (fishing, wood and paper, nonmetallic minerals, jewelry, textile, and agro industry). For example, Legislative Decree No. 728-1997 sets out nine different categories of employment contracts under which workers can be hired. Another decree allows employers to hire workers on a series of short-term contracts without requiring that the workers be made permanent. Workers thus reportedly feared loss of their jobs if they unionized.