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### Viewing cable 04QUITO3132, INFORMATION FOR MEANINGFUL LABOR RIGHTS REPORT

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
04QUITO3132 | 2004-12-01 14:57 | 2011-05-02 00:00 | UNCLASSIFIED | 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 04 QUITO 003132

    SIPDIS

    DOL/ILAB FOR TANYA RASA, SECSTATE PLEASE PASS TO USTR
    REPRESENTATIVE

    E.O. 12958: N/A
    TAGS: ELAB PGOV EC
    SUBJECT: INFORMATION FOR MEANINGFUL LABOR RIGHTS REPORT

    REF: SECSTATE 241222

    ¶1.  Summary:  This cable provides information on labor
    conditions in Ecuador as requested for the Meaningful Labor
    Rights Report, and is keyed to questions included in RefTel.
    End Summary.

    Administration of Labor Law
    ---------------------------

    ¶2.  The Ministry of Labor and Human Resources (MOL) is made
    up of various administrative divisions, including the Office
    of the Vice Minister, the Undersecretary for the Sierra and
    Amazon, the Undersecretary for the Coast and Galapagos, the
    Labor Inspectorate, International Relations, Planning,
    Communication, Internal Auditing and Legal Advising.  The MOL
    received a proposal from the International Labor Organization
    (ILO) for a restructuring of the MOL which they plan to
    implement in December.

    ¶3.  There are 45 labor inspectors nationwide, 11 of whom work
    in Quito.  Article 553 of the labor code defines their
    jurisdiction.  From January through October 2004, the MOL
    conducted 304 inspections.  In accordance with the labor
    inspection law, individual claims can result in fines from
    $5-50.  The Ministry of Labor's inspectorate issues
    approximately 30-40 fines a day.

    ¶4.  Labor complaints not resolved by MOL administrative
    action are heard in trials before the labor judges within the
    Superior Court.  (It is not necessary to first make a labor
    complaint to the MOL.  However, approximately 95% of cases
    are first heard in the MOL.)  There are about 4,000 labor
    court cases a year.  Since June 2004, a new oral procedure
    was adopted for labor cases.  Now, trials that previously
    took 3-5 years can be resolved in 30-60 days.  From July
    2004, when oral procedures began, to November 2004, the five
    labor judges heard 1348 cases.  Labor court judges told
    LabOff they had reached sentences on approximately 450 of
    these cases.  Labor court judges also told LabOff they did
    not have statistics on the reasons the court cases were
    filed.  The decisions of the court can be appealed to the
    Supreme Court within 10 days after the last hearing.  Most
    cases are filed by workers for violation of contracts or of
    the law and unjustified firings.  Employers and workers
    generally obey the decisions of the labor courts.  In Quito
    and Guayaquil, there are approximately 30,000 pending cases
    that date from before the law was passed and need to be tried
    under the written system.

    Freedom of Association
    ----------------------

    ¶5.  The Constitution and labor code provide most workers with
    the right to form trade unions.  According to the AFL-CIO
    Solidarity Center, about 390,000 workers in Ecuador are
    unionized (approximately 8.5% of the Ecuadorian economically
    active population).  Of these, approximately 120,000 are
    members of one of the five union "centrals" or labor
    confederations, while 270,000 are independent.  Those outside
    of the union confederations include drivers, public servants,
    health workers, teachers and oil workers.  The MOL has
    approved 878 unions since 1985.  No unions are registered in
    the Export Processing Zones (EPZs).

    ¶6.  Under the law, unions may freely join federations or
    confederations.  The two largest single labor unions, the
    National Union of Educators and the Union of Social Security
    Workers, are allied with the Democratic Political Movement, a
    far-left party.  There are five large labor confederations;
    no confederation was allied with a political party.  There
    are approximately 70 labor federations established in
    Ecuador.  Important federations include health, electrical
    workers, public servants, oil workers and municipal workers.

    ¶7.  The labor code explicitly prohibits employers from
    interfering in the establishment or functioning of worker
    organizations.  The code also explicitly prohibits employers
    from dismissing workers while they are forming a union or
    negotiating a collective contract; however, the penalties for
    violations are relatively minor and not always enforced in
    practice.  Members of the police, the military, and most
    public sector employees are not free to form trade unions.
    Some public sector employees, however, are covered by the
    labor code and able to form unions and bargain collectively.
    While public sector employees not covered by the labor code
    cannot form unions, they are free to form associations

    ¶8.  The 1991 labor code reforms set the number of workers
    required for an establishment to be unionized at 30.  In
    2002, the ILO criticized the 30-worker minimum as too high
    and called for the government to take the necessary measures
    to amend the code.  In its 2002 Annual Survey of Violations
    of Trade Union Rights, the International Confederation of
    Free Trade Unions reported that 60 percent of the enterprises
    in the country employed fewer than 30 workers, effectively
    excluding 1 million workers from organizing a union.

    ¶9.  Labor laws intended to protect workers' rights to freedom
    of association sometimes failed to deter employers from
    retaliating against workers for organizing.  Reinstatement is
    not a legal right of workers fired for union activity.

    ¶10.  While employees of state-owned organizations enjoyed
    rights similar to those in the private sector, the law
    prevents the majority of public sector employees from
    exercising collective bargaining rights.  However, most
    public employees maintained membership in some labor
    organization.

    Right to Organize and Bargain Collectively
    ------------------------------------------

    ¶11.  According to the MOL, there are currently 651 active
    collective contracts, which cover 134,762 workers (88,694 in
    the public sector and 45,053 in the private sector.)
    However, according to the AFL-CIO Solidarity Center,
    currently 28,260 workers in Ecuador are covered by collective
    bargaining agreements.  None of these are in the EPZs.  As of
    November 2004, there have been 49 collective bargaining
    agreements signed in 2004 (previous years:  2003: 114, 2002:
    124, 2001: 134).  According to the AFL-CIO Solidarity Center,
    there are three primary reasons why the number is so low for
    ¶2004.  These are the closing of many businesses due to the
    poor economy, no new formation of unions due to the 30 person
    minimum, and the public sector not bargaining collectively
    due to the new law on standardizing salaries.  In accordance
    with the labor code, unionized as well as non-unionized
    workers are protected by collective contracts.

    ¶12.  The labor code provides for resolution of labor
    conflicts through an arbitration and conciliation board that
    consists of one representative of the Ministry of Labor, two
    from the union, and two from management.

    ¶13.  The labor code requires workers to be represented by
    only one labor union.  It prohibits discrimination against
    union members and requires that employers provide space for
    union activities upon the union's request.  If the Ministry
    of Labor rules that a dismissal of an employee is
    unjustified, it can require the employer to pay severance to
    the worker of 125 percent of a month's salary for each year
    worked, although the reforms set a cap on such payments.

    ¶14.  During the past year, there have been five strikes, two
    in the public sector and three in the private sector.
    According to the MOL, this is due to increased dialogue and
    intervention on the part of the MOL.  There are few
    restrictions on the right of workers to strike, although a
    10-day cooling-off period is required before a strike can be
    declared.  The labor code limits solidarity strikes or
    boycotts to 3 days, provided that the MOL approves them.  In
    some industries, during a legal strike, workers may take
    possession of the factory or workplace (thus ending
    production at the site) and receive police protection during
    the takeover.  However, in other industries, such as
    agriculture, the law requires a 20-day waiting period from
    the day the strike is called.  During this time, workers and
    employers must agree on how many workers are needed to ensure
    a minimum level of service, and at least 20 percent of the
    work force must continue to work in order to provide
    essential services.

    ¶15.  The labor code provides that "the employer may contract
    substitute personnel" only when striking workers refuse to
    send the number of workers to provide the minimum necessary
    services in service industries.  The employer must pay all
    salaries and benefits during a legal strike; the labor code
    protects strikers and their leaders from retaliation.

    ¶16.  The law does not provide public workers with the right
    to strike and includes a provision that striking public
    sector workers are liable to between 2 and 5 years in prison;
    however, there were frequent unauthorized work stoppages by
    public sector workers.  In September, Congress passed a civil
    service reform law that creates a unified salary structure
    for some public workers (it excludes the police, military,
    teachers, and health care workers).  The law reiterates the
    prohibition against strikes by most civil service employees.

    ¶17.  There is no special prosecutor assigned to handle
    extreme cases of anti-union discrimination or acts of
    interference, such as murders and beatings, however these are
    not common crimes in Ecuador.  The Ministry of Labor is the
    organization within the Ecuadorian government responsible for
    ensuring the respect of workers' rights.

    Prohibition of Forced or Compulsory Labor
    -----------------------------------------

    ¶18.  The Government has proposed legislation to reform the
    penal code to criminalize prostitution of minors under 18 and
    trafficking in persons (TIP).  On August 18, the president
    signed a decree establishing a national commission to fight
    TIP and provide social services to victims.  The Executive
    branch submitted its package of legislative reforms in
    September, which remains under Congressional review.  The
    reforms are designed to bring the penal code into compliance
    with international conventions against trafficking in persons
    and alien smuggling.

    ¶19.  The government and NGOs are designing programs to assist
    trafficking victims.  The ILO with GoE cooperation plans to
    open a shelter for minors who are victims of commercial
    sexual exploitation in Machala by January 2005.  USAID and
    Geneva Global will provide $600,000 to fund 12 to 15 projects
    to address TIP issues in Ecuador.  Geneva Global held a
    conference on November 15 with 38 NGOs to solicit proposals
    for projects.

    Child Labor
    -----------

    ¶20.  Child labor remains a major problem in Ecuador.
    However, the GoE, NGOs and other institutions are taking
    steps to combat worst forms of child labor in Ecuador.  More
    clearly needs to be done, particularly in the enforcement of
    child labor laws and the rehabilitation of child laborers.
    In July 2004, the Ministry of Labor created a Division for
    Child Labor comprised of three officers, augmenting the
    previous single position for Child Labor, which was also
    responsible for international affairs.  The Division meets at
    least monthly with the MOL and inter-agency National
    Committee for the Progressive Eradication of Child Labor.

    ¶21.  In May 2004, the MOL hired eighteen new child labor
    inspectors, bringing the total nationwide to 19.  Currently
    there are 16 inspectors due to resignations; the MOL is in
    the process of hiring six more.  According to the ILO, the
    inspectors have found 500 child laborers in the field.
    Nation-wide the budget to prevent and combat child labor is
    $465,000.  Of this $300,000 went to the Ministry of Social
    Welfare and still has not been spent, $25,000 to the MOL, and
    $140,000 for inspectors' salaries.

    ¶22.  The Institute for the Child and Family (INNFA) has a
    $3.5 million budget to work on child labor issues.  (INNFA's
    funds do not come from the national budget; most funds come
    from import taxes.)  Most of this money goes towards
    scholarships for poor children, while a smaller program is
    aimed towards moving children out of dangerous work.  INNFA
    provides support for child labor inspectors and helped create
    an inspection manual.  INNFA has worked to address the
    problem of child labor in the flower sector by providing
    information on child labor to all the major flower producers.

    ¶23.  The ILO-IPEC began a child labor Time-Bound Program in
    October 2003 with action plans in the banana, flower,
    construction, trash and commercial sex exploitation of minors
    aiming to get children out of work and back in school.  USDOL
    awarded $3 million to Catholic Relief Services to target
    child laborers and children at risk of entering the flower
    and banana sectors.

    ¶24.  The Child Worker Program funded by the Central Bank of
    Ecuador, has developed a workshop program called "Panita"
    which meets three times a week to promote civic values and to
    work with families and schools on the issue of child labor.
    The Child Worker Program is also planning a community
    ombudsman program to hire a community group to receive and
    act on reports of child labor.  The Central Bank provided
    $200,000 annually for the Child Worker Program.
    ¶25.  The labor code needs to be harmonized with the Code for
    Children and Adolescents (passed in Congress in December
    2002), which sets higher standards.  The Child and
    Adolescents Code raised the fine for child labor violations
    to $200-1000; the labor code fine remains at 50 sucres
    (Ecuador's obsolete currency).  In the labor code, the
    minimum work age is 12 for work as domestics or artisans and
    14 for all others, while in the Child Code it is 15 for all.

    Minimum Wage
    ------------

    ¶26.  The minimum wage is defined in Article 94 of the labor
    code and is annually updated by the Ministry of Labor.  (The
    MOL's National Technical Secretariat of Human Resources and
    Remuneration Development sets the minimum wage for public
    sector workers and the National Salary Council sets those for
    the private sector.)  The current minimum wage as of November
    2004 is $135.62 per month and $0.95 per hour.  This is the
    general minimum wage and the MOL also sets minimum wages by
    sectors.  There are reports of non-compliance with the
    minimum wage, particularly for foreign workers.

    Occupational Safety and Health
    ------------------------------

    ¶27.  The MOL reported that it received 71 work accidents
    complaints, 9 of which were deaths, during 2003.  Workers can
    file complaints with the MOL's labor inspectorate or with the
    Social Security Institute.  Occupational safety and health
    regulations are better enforced for those workers covered by
    collective bargaining agreements.  The construction, flower
    and agro-industrial sectors reportedly suffer higher than
    average safety and health problems.
    KENNEY

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