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Protection of Wages Convention, 1949 (No. 95) - Albania (RATIFICATION: 2001)

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In order to provide a comprehensive view of the issues relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 95 and 173 (protection of wages) together.

Protection of Wages Convention, 1949 (No. 95)

Article 4 of the Convention. Payment of wages in kind Further to its previous comments, the Committee notes with interest that following the entry into force of Act No. 136/2015, a new paragraph was added to section 118(2) of the Labour Code pursuant to which the value of the wages in kind should be fair and reasonable and shall not exceed 20 per cent of the monthly wage.
Article 8(1). Deductions from wages. The Committee notes that section 122(2) of the Labour Code provides for certain deductions that the employer may make from the employee’s wages, including obligations stemming from a deliberately caused damage which would be compensated without restrictions. It recalls that deductions from wages shall be limited in accordance with Article 8(1). It also recalls that the Protection of Wages Recommendation, 1949 (No. 85), provides that: (i) deductions from wages for the reimbursement of damage to the products, goods or installations of the employer should be authorised only when loss or damage has been caused for which the worker concerned can be clearly shown to be responsible; (ii) the amount of such deductions should be fair and should not exceed the actual amount of the loss or damage; and (iii) before a decision to make such a deduction is taken, the worker concerned should be given a reasonable opportunity to show cause why the deduction should not be made. The Committee requests the Government to provide information on the application of section 122(2) of the Labour Code in practice and in particular on how it may be determined that a damage has been deliberately caused in this context.

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

Applicable legislation. Further to its previous comments on the conflicting provisions addressing workers’ claims in case of the employer’s insolvency in various pieces of legislation, the Committee notes the amendment of section 605 of the Civil Code, following the adoption of Act No. 113/2016, which clarifies that section 605 does not apply to bankruptcy proceedings. The Committee further notes that: (i) section 124 of the Labour Code, which provides that, in case of insolvency, the employer’s obligations to the worker have priority over all other debts, also provides that such priority is not suspended by the procedure of bankruptcy; (ii) the new Bankruptcy Act (No. 110/2016) which repealed the previous legislation on bankruptcy (No. 8901/2002) contains provisions on workers’ claims which appear to be inconsistent with section 124 of the Labour Code; and (iii) the new Bankruptcy Act appears to give workers’ claims the same rank as claims for unpaid taxes (sections 38 and 144 of the Bankruptcy Act read together), which would not be in conformity with Article 8(1). In this context, the Committee notes that in its report submitted in 2011, the Government had indicated that under the Constitutional Court case law, laws which are adopted by three-fifths of the Members of the Parliament of Albania (such as the Labour Code) are ranked higher in the hierarchy of norms that the laws which are adopted by simple majority (such as the Bankruptcy Act No. 8901/2002 that was then in force). The Committee therefore understands that the relevant provisions of the Labour Code would prevail over those of the Bankruptcy Act. The Committee requests the Government to confirm whether section 124 of the Labour Code prevails over the abovementioned provisions of the Bankruptcy Act, and if so, to take the necessary measures to review the Bankruptcy Act in order to remove any conflicting provisions.
Article 6 of the Convention. Claims included in the privilege. In its previous comments, the Committee requested the Government to specify the claims covered under the wage claims privilege provided for under section 124(2) of the Labour Code. The Committee notes with interest that section 124(2) of the Labour Code has been amended by Act No. 136/2015, to specify that the first rank privilege granted to wage claims under that section covers the following claims: (a) workers’ claims for wages, for a period of not less than three months before the termination of employment; (b) workers’ claims for payment of unpaid leave, for the corresponding part of the year of the termination of employment, as well as during the previous year; and (c) severance payment upon termination of employment.

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Article 2 of the Convention. Scope of application. Further to its previous comment on categories of workers that are excluded from the scope of application of the Labour Code under section 4, the Committee notes the Government’s reference to civil servants whose employment and working conditions are regulated by Law No. 8549 of 11 November 1999. The Committee understands, however, that the provisions of the Labour Code regarding the protection of wages continue to apply to civil servants to the extent that Law No. 8549 does not address such issues, except for the salary structure.
Article 4. Partial payment of wages in kind. Further to its previous comment, the Committee notes the Government’s reference to the Council of Ministers Decision No. 139 of 14 March 2007, on the limits of determining the wages in kind, which basically establishes a meal allowance for the workers employed at workplaces with no canteen available. As the text of the Council of Ministers Decision No. 139 has not been made available, the Committee would appreciate receiving a copy. Moreover, the Committee notes the Government's indication that, according to paragraph 2 of Decision No. 139, allowances in kind are defined in the collective or individual labour agreement. In this regard, the Committee recalls that the Convention permits the partial payment of wages in kind only to the extent that is authorized by laws or regulations, collective agreements or arbitral awards but not individual agreements. The Committee therefore requests the Government to take the necessary measures to modify section 118(2) of the Labour Code and paragraph 2 of the Council of Ministers Decision No. 139 in order to bring them into conformity with this Article of the Convention.
Article 13. Date and place of payment of wages. Further to its previous comment, the Committee notes the Government’s reference to the Council of Ministers Decision No. 230 of 7 April 2010 on the assignment of responsibilities of the central government institutions concerning the procedures of making payments. The Committee observes, however, that this text relates only to public sector employees. The Committee recalls that the Convention requires measures to ensure that wages are paid only on working days and at or near the workplace and also that payment of wages in taverns, places of amusement or commercial shops is prohibited. The Committee again requests the Government to take appropriate action in order to give full effect to this provision of the Convention.
Part V of the report form. Application in practice. The Committee would be grateful if the Government would provide in its next report up-to-date information on the application of this Convention in practice, including, for instance, extracts from reports of the labour inspection services, statistics on the number of inspection visits carried out and the results obtained in matters covered by this Convention, any difficulties encountered in the regular payment of wages either in the public or the private sector as well as any other particulars which would facilitate the Committee’s task to supervise the observance of the standards set out in this Convention.

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The Committee notes the Government’s report and wishes to draw attention to the following points.

Article 2 of the Convention. Scope of application. The Committee recalls its previous comment in which it requested the Government to specify the categories of workers who are currently excluded from the scope of application of the Labour Code under the terms of section 4. In the absence of a reply on this point, the Committee again asks the Government to indicate any categories of workers who may be exempted from the protective coverage of the Labour Code and to explain how it is ensured that the earnings of those workers are adequately protected in accordance with the requirements of this Convention.

Article 4. Partial payment of wages in kind. The Committee notes that section 118(2) of the Labour Code authorizes the payment of wages in kind only within the limits set by decision of the Council of Ministers. Recalling that the Convention requires specific provisions to ensure that the goods and services which may be offered in lieu of cash wages are appropriate for the personal use and benefit of the worker and his/her family and that they are valued fairly, the Committee would appreciate receiving a copy of any relevant decision which may have so far been adopted by the Council of Ministers. In this connection, the Committee draws the Government’s attention to paragraphs 104–160 of its 2003 General Survey on the protection of wages, which offer guidance concerning possible ways in which legislative conformity with this Article of the Convention may be ensured.

In addition, the Committee recalls that the Convention specifically requires the partial payment of wages in kind to be regulated only by national law or regulation, collective agreement or arbitration awards, and not individual agreement. It therefore considers that section 118(2) of the Labour Code is not fully consistent with the Convention to the extent that it permits allowances in kind to be negotiated and agreed upon by the employer and the worker. The Committee requests the Government to take the appropriate action in order to bring the national legislation into line with the requirements of the Convention in this respect.

Article 7. Works stores. The Committee notes the Government’s indication that the national legislation does not permit enterprises to sell their products to their employees. The Committee observes, however, that by “works stores” the Convention refers to company stores owned or operated by the employer for the sale of any commodities to the workers and not only of the enterprise’s own manufactured products (for instance shops selling clothing, food, household articles, etc.). Recalling that the intention behind this Article of the Convention is to protect the workers’ freedom to make use of such stores or services at their sole discretion and also to ensure that goods or services are provided at fair and reasonable prices for the benefit of the workers concerned, the Committee would be grateful if the Government would specify whether any such arrangements exist and, if so, how their operation is regulated in law and practice.

Article 10. Assignment of wages. The Committee has been requesting the Government to clarify whether the national legislation regulates the notion of assignment of wages, that is to say, the possibility for an indebted worker to agree with the competent judicial or administrative authorities upon a voluntary arrangement whereby part of his/her wages are paid directly to the creditor in settlement of his/her debts. Even though the attachment of wages, i.e. the withholding of part of the worker’s wages by the employer in application of a court order, is permitted within the limits set out in section 123 of the Labour Code, it is not clear whether similar provisions exist for the assignment of wages. The Committee requests the Government to supply additional explanations in this regard.

Article 13. Time and place of payment of wages. Further to its previous comment on this point, the Committee recalls that the Labour Code, as it currently stands, does not give effect to this Article of the Convention since it does not provide for the payment of wages on working days only and at or near the workplace nor does it contain any provision expressly prohibiting the payment of wages in taverns, similar places of amusement, or commercial shops. Even though the provisions of this Article of the Convention may appear less relevant today in view of the increasing use of non-cash methods of payment of wages, such as direct bank transfers, the Committee considers that they still offer protection to large numbers of workers, especially rural workers, to whom electronic means of payment are yet unknown. It therefore requests the Government to take appropriate action in order to align its legislation with the requirements of the Convention in this regard.

Part V of the report form.The Committee would be grateful if the Government would provide in its next report up to date information on the application of the Convention in practice, including, for instance, extracts from reports of the labour inspection services, statistics on the number of inspection visits carried out and the results obtained in matters covered by the Convention, any difficulties encountered in the regular payment of wages either in the public or the private sector as well as any other particulars which would facilitate the Committee’s task to supervise the observance of the standards set out in the Convention.

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The Committee notes the Government’s communication dated 5 May 2005 in reply to the observations made by the Trade Unions Confederation of Albania (CTUA) regarding the application of the Convention. The Committee considers, however, that the Government’s comments are not relevant to the provisions of the Convention nor do they respond to the specific points raised in the communications of the CTUA, especially as regards the cases of unjustified wage deductions for the payment of municipal taxes without such deductions being provided for in the law. The Committee therefore asks the Government to supply in its next report clearer explanations on these points as well as detailed and documented information on all the issues addressed in the Committee’s last direct request.

Moreover, the Committee notes with interest the Government’s recent ratification of the Protection of Workers’ Claims (Employer’s Insolvency) Convention, 1992 (No. 173), and the acceptance of the obligations of Part II of this Convention providing for the protection of workers’ claims by means of a privilege, which involves ipso jure the termination of its obligations under Article 11 of Convention No. 95.

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The Committee takes due note of the information provided by the Government in its reports. It also notes the comments supplied by the Confederation of Trade Unions of Albania (CTUA) dated 21 October 2003 and 30 September 2004. The Committee wishes to draw the Government’s attention to the following points.

Article 2, paragraph 1, of the Convention. The Committee notes that under section 4 of the Labour Code, persons whose employment is regulated by a special law are excluded from its scope of application. While recalling that the Convention applies to all persons to whom wages are paid or payable, the Committee asks the Government to specify the categories of workers excluded under this provision and to indicate the laws or regulations giving effect to the requirements of the Convention with respect to these categories.

Article 4, paragraph 2. The Committee notes that under section 118(2) of the Labour Code, the partial payment of wages in kind is authorized provided that the parties so agree in writing and respect the limits set by the Decision of the Council of Ministers. According to the same provision, payment in kind is only meant to cover accommodation and food that is consumed by the employee during the breaks at the workplace. However, the Labour Code does not contain an explicit prohibition against the payment in the form of alcoholic drinks or noxious drugs, nor does it specify the manner in which it is ensured that the value attributed to allowances in kind is fair and reasonable. The Committee requests therefore the Government to provide supplementary information in this respect and to transmit a copy of any relevant Decision of the Council of Ministers.

Article 7. The Committee would be grateful if the Government could specify whether any works stores for the sale of commodities to the workers are in operation, and if so, indicate the provisions ensuring that such stores or services are not operated for the purpose of securing profit but for the benefit of the workers concerned.

Article 8. The Committee notes the comments made by the Confederation of Trade Unions of Albania (CTUA) according to which there have been numerous cases of municipal taxes being deducted from wages contrary to section 117(1) of the Labour Code which only allows for the deduction of income tax and social security contributions. In its reply, the Government admits that such irregularities are observed, especially in the municipalities of Tirana and Kavaja. The Committee trusts that the Government will take all necessary measures to put an end to such practices and to ensure strict compliance with the provisions of the Labour Code in respect of wage deductions.

Article 10. While noting the provisions of the Labour Code concerning the attachment of wages, the Committee would appreciate if the Government could indicate the provisions regulating the conditions under which and the limits within which wages may be assigned.

Article 13, paragraph 1. The Committee notes that the general labour legislation does not expressly provide for the payment of wages on working days only and at or near the workplace, nor does it contain any provision specifically prohibiting the payment of wages in taverns or similar establishments. The Committee wishes to refer, in this connection, to paragraphs 400 and 413 of its 2003 General Survey on the protection of wages in which it considered that any formal arrangements regulating the payment of wages by postal or bank transfer would appear to fall well within the exceptions permitted by Article 13, paragraph 1 (that is exceptions "provided by national laws or regulations") and would therefore pose no problem in regard to this Article, but also stated that the provision of this Article of the Convention is undoubtedly still relevant in a large number of countries, notably with regard to labour remuneration practices concerning agricultural workers. The Committee therefore hopes that on an appropriate occasion measures will be taken to ensure the application of the requirements of the Convention regarding the place and time of wage payment, especially in those occupations or branches of activity where the payment by bank transfer, or other non-cash methods of payment, is not practicable or generalized.

Part V of the report form. The Committee would be grateful if the Government would communicate in its next report concrete information on the effect given to the Convention in practice, including for instance reports of labour inspection services, statistics on the number of inspection visits carried out and the results obtained in matters covered by the Convention, as well as any other particulars which would facilitate the Committee’s task to supervise the observance of the standards set out in the Convention.

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The Committee notes with interest the Government’s first report, received in September 2003. It also notes the comments supplied by the Confederation of Trade Unions. The Committee will examine the Government’s report and the comments of the organization in detail at its next session and welcomes any additional information that the Government may wish to provide.

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