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### Viewing cable 04QUITO2642, ECUADOR LABOR UPDATE

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
04QUITO2642 | 2004-09-30 20:38 | 2011-05-02 00:00 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy Quito

`

    This record is a partial extract of the original cable. The full text of the original cable is not available.

` `

    UNCLAS SECTION 01 OF 03 QUITO 002642

    SIPDIS

    SENSITIVE

    SECSTATE FOR USTR
    USTR FOR BUD CLATANOFF, USDOL FOR JORGE PEREZ-LOPEZ, DRL/IL
    FOR GREG MAGGIO, EB FOR AMY HOLMAN, GENEVA FOR JOHN
    CHAMBERLIN

    E.O. 12958: N/A
    TAGS: ELAB PGOV EC
    SUBJECT: ECUADOR LABOR UPDATE

    REF: A. GUAYAQUIL 1064

         ¶B. QUITO 2614

    ¶1.  (U) Summary.  Following are labor-related developments of
    interest:

    --MOL to Consult Unions on Subcontracting Decree (para. 2)
    --Rules Proposed for National Labor Council (3)
    --MOL Computers for Child Labor Inspectors (5)
    --National Campaign to Eliminate Child Labor in Trash Sector
    (8)
    --Public Sector Protests Salary Standardization (9)
    --Strike Affects 120 Hospitals (11)
    --Galapagos Park Strike Ends (12)
    --Illegal Peruvian Migrant Workers Deported (13)
    --Profit Sharing Benefits Selected Workers in 2003 (14)
    --Unemployment and Informal Sector Stats (15)

    MOL to Consult Unions on Subcontracting Decree
    -------------------------------------------

    ¶2.  (SBU) The Minister of Labor told LabOff on September 29
    the decree will be signed no later than October 1 by the
    President and published officially the following week.
    Patricio Contreras of the Solidarity Center (AFL-CIO) told
    LabOff that Minister of Labor Izurieta will meet with unions
    again regarding the draft subcontracting decree on September
    ¶30.

    Operating Rules Proposed for National Labor Council
    --------------------------------------------- ------

    ¶3.  (U) According to the Sandra Jacomi, assistant to Minister
    of Labor Raul Izurieta, the National Labor Council has met
    three times since its creation in July.  Council members have
    been named.  On September 9, the ILO and the Chambers of
    Commerce and Industry separately proposed operating rules for
    the National Labor Council but these are still being studied
    and have not been approved yet.  The MOL has yet to name the
    Technical Secretariat who will staff the National Labor
    Council.  The ILO has proposed a profile for members of the
    Technical Secretariat.

    ¶4.  (U) The Minister proposed on September 27 that Labor Code
    reform be one of the themes to be discussed in the Council.
    This includes the issues of company retirement and hourly
    work.  There are no proposals pending from the union or
    business sectors on Labor Code reform.

    MOL to Provide Computers to Child Labor Inspectors
    --------------------------------------------- -----

    ¶5.  (U) Jenny Cepeda, Technical Secretary of the Division of
    Child Labor in the MOL, told LabOff on September 27 the MOL
    is acquiring computers for the child labor inspectors which
    should be in place by mid-November.  She said the MOL has set
    aside $2000 a month for transportation funds for the
    inspectors.  Currently, two child labor inspectors use the
    Institute of the Child and Family (INNFA) offices in Los Rios
    and El Oro.  Four inspectors use INNFA vehicles in Guayas, El
    Oro, Los Rios and Pichincha.  Bladimir Chicaiza of the ILO
    told PolOff there is a critical lack of resources for the
    rehabilitation of child workers.  In Guayas, Los Rios and El
    Oro provinces, he said, transportation is provided by the
    Association of Banana Exporters.

    ¶6.  (U) Ruth Mosquera, Director of the Division of Child
    Labor in the MOL, told PolOff on September 28 that two child
    labor inspectors had recently resigned.  She said they will
    work until the end of the month when they will be replaced.
    Chicaiza said two training sessions have provided child labor
    inspectors with adequate knowledge of the legal framework
    related to child labor.  He said there is willingness on the
    part of the MOL to offer further training to the inspectors.

    ¶7.  (U) To confirm information in Ref A regarding inspections
    of Dole banana plantations, PolOff spoke on September 27 with
    Juanita LaRosa, the child labor inspector for Guayas
    province.  LaRosa said that 18 out of the 55 banana farms she
    has inspected in Guayas since August 2004 have belonged to
    Dole (around 33%).  She said this is because they are located
    close together and the MOL conducts inspections by geographic
    zone.  LaRosa said that there are 50 Dole farms in this zone.
     Patricia Paez, Undersecretary in the MOL for the Coastal
    Region told PolOff on September 27 that all companies are
    getting equal treatment.  Patricia Hoyos of UNICEF told
    PolOff on September 29 she believes the inspection sites are
    being selected impartially.  Hoyos said there is no way for
    the inspector to know who the owner is of the haciendas
    marked on inspection maps.

    National Campaign Focuses on Children
    -------------------------------------

    ¶8.  (U) Press reported that on September 23, the second phase
    of a national campaign "Child Hope" began which aims to gain
    public support for eliminating child abuse.  The first phase
    of the campaign, developed by UNICEF, focused on eliminating
    child labor in the trash sector by creating 25
    micro-enterprises generating family income, educational
    scholarships and health services.

    Public Sector Protests Standardization of Salaries
    --------------------------------------------- ------

    ¶9.  (U) Patricio Contreras of the Solidarity Center (AFL-CIO)
    told LabOff on September 27 that various public sector
    workers were considering protesting the January 2004 Civil
    Service Law on standardizing public sector salaries.  The law
    was proposed by the GoE as part of the last agreement with
    the IMF.  The National Confederation of Public Workers
    (CONASEP) along with electrical, petroleum,
    telecommunication, health and municipal workers is
    participating and Ministry of Government workers announced
    they would strike if the law is not overturned by the
    Constitutional Court.  On September 29, the Court ruled the
    law was constitutional.

    ¶10.  (U) Unions are against the law because it sets maximum
    salaries that limit collective bargaining.  The law also caps
    severance for fired workers at a maximum of $1000 per year of
    service.  The law also adds new requirements for collective
    bargaining by stating that parties must have the approval of
    the Ministries of Finance and Labor as well as the Prosecutor
    General to begin collective bargaining.

    Health Workers Strike - 120 Hospitals Affected
    ---------------------------------------------

    ¶11.  (U) Press reported that health workers held a 48-hour
    work stoppage September 27-28 to demand respect of the 2005
    budget and the signing of a ninth collective bargaining
    agreement.  The strike affected 120 hospitals and 14,059
    health workers participated.  The agreement would provide
    higher wages, better work stability and overtime pay.  If no
    solution is reached by October 4, health workers have
    threatened an indefinite strike.

    Galapagos Park Workers Strike Ends
    ----------------------------------

    ¶12.  (U) On September 28, the 19-day strike of 250
    non-unionized workers in Galapagos National Park ended after
    Minister of Environment Fabian Valdivieso replaced Fausto
    Cepado with Victor Carrion as Park Director (Ref B).  The
    Ministry of Environment agreed to issue individual work
    agreements with the park employees, a demand of the
    association of park workers.  Park worker Carlos Macias
    stated to the press that the Government had also promised
    $700,000 for wage increases.

    Illegal Peruvian Workers Detained
    ---------------------------------

    ¶13.  (U) On September 13, Immigration officials detained 118
    Peruvians for violating conditions of the Andean Migration
    Card to work on the sugar plantation Hacienda Sausalito in
    Guayas province, according to press reports.  The Peruvian
    workers claimed they had worked twelve hour days, seven days
    a week for $130 a month.  The workers were deported to Peru
    on September 16.

    Profit Sharing For Some Workers in 2003
    ---------------------------------------
    ¶14.  (U) Press reported that, according to the Ministry of
    Labor, in 2003, 3,518 companies distributed $102.2 million to
    160,193 employees as mandatory 15% profit-sharing as required
    under the Labor Code.  This represented a six percent
    decrease in payments compared with 2002.  According to
    Ecuadorian law, 10% of a company's profits must be
    distributed to employees and 5% goes to employees' families.
    The largest sum paid to a single worker was $66,616 and eight
    companies paid out over one million dollars to their workers.
     The portion going to women increased by 129 percent from
    1997 to 2003.  In 2003, 51,861 women received $25.1 million
    in profit sharing.

    Unemployment and Informal Sector Statistics
    -------------------------------------------

    ¶15.  (U) The press reported that, according to the Central
    Bank of Ecuador, unemployment in Ecuador has risen from 9.3%
    in December 2003 to 11.53 percent in May 2004.  According to
    the National Institute of Statistics and Census (INEC), 1.5
    million Ecuadorians are currently employed in the informal
    sector.
    KENNEY

`