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A Government representative thanked the Committee for the possibility to present up-dated information on the application of the Minimum Wage Fixing Convention, 1970 (No. 131). She considered that a literal reading of Article 3 of the Convention would lead to the conclusion that it was being adequately applied by the Government in view of the national conditions. Even if one assumes that the conditional character of the phrase used in the instrument ("shall, so far as possible") allows ratifying states to exempt themselves from these provisions, it was not the intention of the Government to deviate from the guidelines set forth in the international standard. The Government of Uruguay also complied with Article 4 of the Convention, as the minimum national wage was fixed and adjusted periodically every four months. Uruguay was experiencing the most serious economic and financial crisis in its history due to the same causes that have led to the destabilization of the economic policy in the whole region. Nevertheless, as the Government had indicated in its previous reports, it remained true that the national minimum wage was being fixed by the Executive not as a reference amount for the payment of wages, but as a criteria for the calculation of all the benefits provided by the social security system, such as old-age and other pensions, family allowances and insurance payments for sickness, accidents and unemployment. In this sense, the real wages received by the workers were in their large majority higher than the national minimum wage. She strongly repudiated the view that all those whose salary was not negotiated collectively were receiving minimum wages, and referred to the official statistics in this respect.

According to the continuous monitoring of households in 2002, the average salary in Uruguay amounted to 8,500 pesos, which was 8 times higher than the national minimum wage fixed at the level of 1,170 pesos per month. The data collected by the Social Providence Bank in 2002 showed that the average salary of contributors amounted to 5,896 pesos (5 times higher than the minimum wage) in the private sector and to 8,329 pesos (8 times higher) in the public sector. The beneficiaries of the state funds for the military and police personnel, as well as members of the parastatal social security institutions, such as university professors, banking employees and notaries had incomes much higher than the national minimum wage. The statistical information showed that the figures advanced by the Uruguayan trade unions and noted by the Committee of Experts were not exact. Out of the total of approximately 3 million residents and 780,000 wage earners, it was incorrect to state that 875,000 employees and their dependants received the equivalent of the national minimum wage. Furthermore, in addition to their salaries, Uruguayan workers received family allowances equivalent to 16 per cent of the national minimum wage, as well as food allowances which constituted a high percentage of public expenses. Together with these measures, the Government had implemented a plan for contracts for transitory occupation in cases of critical social situations and employment in various services with the payment of the average monthly salary at the minimum level for 17 workdays of 6 work-hours per day.

With regard to consultations with the social partners, the Government representative indicated that, notwithstanding the fact that the national minimum wage was fixed by the administrative decision, the informal contacts and permanent relations with the social partners could surely not escape the attention of the Committee when assessing the reality in the country. Tripartism had a long history in Uruguay. Already in 1943 the country had established the mechanism for wage fixing by sector of activity on a tripartite basis. Now, there were numerous institutions providing for the tripartite participation including the National Employment Council, the Social and Labour Commission of MERCOSUR, the National Council in Occupational Safety and Health, the Tripartite Commission on Equality of Opportunities, the tripartite Commission for the application of Convention No. 144, and the Social Providence Bank.

Consultations and relations between the Government and the social partners were continuous, cordial and respectful of the differences of opinion which naturally emerged on the various aspects of the national policies. In 1995, when the Government was experiencing the effects of the opening up of the economy on labour relations, it created a tripartite framework to seek consensus in regulating collective bargaining. Regretfully, nearly four years of meetings had not brought much result. Had they been more effective, it would have been possible to set up a new tripartite committee for the purpose of fixing the wages of workers who were not covered by collective agreements. The difficult economic and financial situation which the country was passing through required enormous efforts of all social partners. In recent years, new collective agreements had been concluded at the level of the sector of activity, trade unions became more representative and were able to conclude long-term agreements, adjusting themselves to economic realities. As regards legislative initiatives, the Ministry of Labour and Social Security had put forward proposals for draft laws and various initiatives for the protection of wages, reform of the unemployment insurance and modification of the hours of work. The draft concerning the protection of wages had been submitted in consultation with the PIT-CNT, which had, inter alia, asked for inclusion in the text of an article providing for the direct discount of trade union contributions. The draft concerning the modification of the hours of work will be submitted shortly for consideration in consultation with the social sectors.

The Worker members, following the comments made by the Committee of Experts, recalled that wage fixing had passed from the level of tripartite consultation by sector of economic activity to wage fixing at the enterprise level, which contributed to the weakening of collective bargaining in this country. It should also be noted that the minimum wage was set in a unilateral manner by decrees and did not correspond to the social realities in the country. This practice was, in fact, one of the factors explaining the increased poverty in Uruguay. The practices were disturbing, and measures aimed at guaranteeing a macroeconomic balance should not be incompatible with minimum wage fixing through social dialogue and collective bargaining. The absence of consultations with trade union organizations, the weakening of collective bargaining and unilateral minimum wage fixing were elements that undermined the application of Convention No. 131. This was why technical assistance by the ILO would be of extreme importance. With respect to pressure of the regional integration of MERCOSUR at the legal level in Uruguay, also mentioned by the Government, the Worker members favoured the strengthening of social dialogue and consultations with the workers. In particular, it was suggested that the states concerned should strengthen the consultative economic and social forum of MERCOSUR.

The Employer members stated that the discussions on this case centred around two issues: the criteria and the procedure for establishing a minimum wage. As regards the criteria, they noted that the Government of Uruguay had indicated the need for greater competitiveness and for the aligning of prices with those of its main partners in MERCOSUR. There were, of course, other criteria to be taken into consideration but the problem remained the specific minimum wage itself. Such criteria were not so much legal terms requiring further interpretation; they were rather factors which had to be reconciled. They understood the dissatisfaction of the Worker members with the minimum wage set in reality. However, it was not up to the Committee of Experts nor this Committee to consider or judge a specific minimum wage or to set or even to fix it. As regards the procedure for fixing a minimum wage, they noted the that they were set unilaterally as indicated in the observation of the Committee. The question was the relationship between the setting of a minimum wage by law and by collective agreement, especially at the enterprise level. It seemed that differentiated solutions were needed. In any case, representative organizations of employers and workers needed to be consulted. They noted the statement of the Government representative of Uruguay indicating that these organizations did not exist for all sectors and branches of economic activity. Moreover, there seemed to be differences of opinion as to which organizations were representative and thus should be consulted. With reference to the comment of the Committee of Experts regarding existing organizations which could be consulted, they reminded this Committee that it was certainly a question of the constitution of these organizations as to whether they also had the authority to engage in consultations. They supported the request of the Committee of Experts regarding the need for information on collective agreements that fixed wages for specific sectors and branches of economic activity, as indicated in paragraph 9 of the observation. They finally noted that a specific minimum wage could not be fixed or recommended by the Committee of Experts or this Committee, but technical problems in the procedure for fixing a minimum wage could be solved through technical assistance provided by the Office.

The Worker member of Uruguay stated that the information provided by the Government representative did not contribute at all to the debate on minimum wages. The average wages referred to by the Government did not permit them to see what the actual value of the lowest wage used to carry out the calculations was. Moreover, none of the tripartite bodies mentioned in the Government's statement had discussed the fixing of minimum wages. In relation to Articles 3 and 4 of Convention No. 131, reference was made to the observation of the Committee of Experts regarding "the elements to be considered in fixing and adjusting the minimum wage rates". The situation, already deplored by the PIT-CNT, continued to worsen. It continued without taking into account the criteria set in Article 3 of the Minimum Wage Fixing Convention, 1970 (No. 131). Historically, according to Act No. 10449 of 12 November 1943, minimum wages were set through negotiation in tripartite committees, by category of work and branch of economic activity. These wage councils had not been convened by the Executive since 1990, except in the health, transportation, construction and banking sectors - sectors which the Government considered to be key from a macroeconomic point of view. By failing to call upon the wage councils to fix the minimum wage, the Government had left wage fixing in the hands of the market.

The group of workers, whose working conditions - including the minimum wage - were being regulated through collective bargaining, had been dramatically reduced from 95 per cent in 1986 to 16 per cent in 2002. Overall, this had led to a situation where real national minimum wages in the private sector were set administratively by the Executive. The absurd result of this minimum wage-fixing policy was that the minimum wage fixed ended up being a very small amount which was equivalent to US$ 36 per month, while the basket of basic products for a family of three cost the equivalent of US$ 824. Real wages in the private sector decreased by 5.7 per cent between July 2001 and July 2002. The level of today's real wages was similar to that of December 1984. This was the result of the implementation of a minimum wage-fixing machinery in the absence of consultation as part of an economic policy that was using wages as a variable for adjustment. What the Government had stated in its reply to the Committee of Experts was incorrect. It had stated that "there was no one ready to work for such a low minimum wage". Yet, the PIT-CNT observed that with almost 20 per cent of the economically active population found itself in a situation of open unemployment and with more than 50 per cent of the economically active population experiencing employment problems (precariousness, underemployment, informal work), it was doubtful that there were no people looking for whatever type of work to avoid the most absolute misery. In respect of direct employment in emergency situations, he indicated that the remuneration offered was the minimum wage plus 25 per cent, which was the equivalent of US$ 45. However, only 0.5 per cent of the unemployed benefited from these plans.

The Worker member further stated that the Government had violated its obligation to consult with the representatives of workers' and employers' organizations concerned in the fixing of minimum wages. The situation had even worsened when, in March 2003, Act No. 17626, which provided that all wage adjustments of all civil servants, without exception, including statutory wages or those determined in collective agreements, would be determined at the same time and according to the percentage of the general adjustments arranged by the executive powers of the central administration, was adopted.

In conclusion, he mentioned that the statement by the Government representative did not help to clarify the case and the Government should explain the formal and substantial aspects of the Convention. It should also be requested to provide a detailed report on the situation next year. He supported the suggestion of technical assistance by the Office in order to promote the application of the Convention, in consultation with the social partners.

The Government member of Chile stated that he valued the very detailed presentation of the Government representative of Uruguay. He said that Uruguay distinguished itself by its devotion to tripartism, which should be taken as an example for the rest of the Latin American region. He indicated that in the framework of MERCOSUR, Uruguay had boosted social dialogue and coordination. In his opinion, the problems of collective bargaining referred to by the worker member of Uruguay, even if they related to the subjects debated, did not fall within the scope the Convention No. 131 on minimum wage fixing. He added that the framework of social dialogue should be able to offer solutions to this case.

The Worker member of Venezuela declared that the interventions of the worker member of Uruguay and of the Worker members had been very illustrative of the situation in Uruguay. He indicated that attention should be paid to the fact that for 11 years now, this case had been discussed in the Committee. The Committee should request the Government to implement the provisions of the Convention as soon as possible.

The Government member of Argentina expressed her appreciation of the very detailed presentation made by the Government of Uruguay, which in her opinion, satisfactorily answered the request of the Committee of Experts. She emphasized their commitment to dialogue and tripartism and referred to efforts by the Government of Uruguay to overcome the profound social and economic crisis that had hit the region. She also highlighted the promotion of the fundamental rights embodied in the Social and Labour Declaration of MERCOSUR.

The Worker member of Brazil, as a citizen of a member country of MERCOSUR stated that he was particularly concerned about this case. There was currently a lack of social dialogue in the countries participating in the regional economic integration process. It was extremely serious that the Government, in order to justify the non-observance of its international obligations, used the argument of the need to align prices to those of MERCOSUR partners. Such an extreme argument would lead to a downward spiral of salaries, with every country seeking to lower the wages of its workers in order to render its products more competitive, instead of investing in productivity and technological development. The economic integration process would no longer be a process of development but would ruin the population. Likewise, the argument that maintaining the purchasing power of workers would cause inflation was unacceptable. In this context, the question was raised as to how the United Nations system, while using all possible efforts to ensure the application of Conventions, could prevent other organizations such as the International Monetary Fund from requiring their member States to take measures aimed at limiting the total wage bill; measures that in addition to transferring income from labour into capital, violated manifestly international labour standards. This question was worthwhile reflecting upon.

The Government representative was grateful for the constructive interventions made by the Workers, the Employers and the Governments. She declared that the Government would try to give impetus to these topics within MERCOSUR and indicated that her Government, as always, welcomed the offer of technical assistance. She suggested that September 2003 would be an appropriate time since the forthcoming World Congress on Labour Rights would be held then in Montevideo.

The Employer members noted the extensive information provided by the Government representative of Uruguay and stated that this information should be supplied in a report to the Office so as to have a clearer picture of the situation. They said that the Committee should thank the Government for its willingness to accept technical assistance from the ILO.

The Worker members reiterated the two points in relation to which the Convention had not been applied: (1) the abandonment of minimum wage negotiations by sector of activity in favour of wage negotiation at the enterprise level which resulted in the weakening of collective bargaining; and (2) unilateral minimum wage fixing. They noted with interest that the Government had accepted the technical assistance from the Office and requested the Government to provide the Committee of Experts with information on developments regarding the situation in order to enable it to examine at its next year's session, the progress achieved.

The Committee noted the oral explanations and detailed statistical information given by the Government representative and took note of the ensuing discussion. It recalled that the case had been discussed in this Committee on two different occasions, most recently in 1998, when the Committee had noted that problems remained in regard to the application, in practice, of the Convention both concerning the criteria of determination of the minimum wage and the prior consultation of employers' and workers' organizations for that purpose. The Committee noted the information regarding the average national wage which was significantly higher than the minimum wage and the tripartite consultations which had taken place with respect to other ratified Conventions. The Committee observed, however, that it had not as yet been possible to set up the tripartite committee for the determination of minimum wages. The Committee noted that the requirement for meaningful consultations with the social partners in determining minimum wage levels, due regard being taken of the basic needs of workers and their families, was the quintessence of Convention No. 131 and that no government could be relieved of its obligations for reasons of economic policy or expediency. The Committee expressed concern about the absence of concrete progress in determining minimum wage levels which kept in line with the economic and social realities of the country and also in consulting the social partners for this purpose in an institutionalized form and on a regular basis. The Committee expected that the Government would give proper consideration to its persistent requests and urged the Government to communicate detailed information to the Committee of Experts for examination at its next session on the measures taken to address these issues. The Committee took note of the Government's interest to draw on the technical assistance of the Office in addressing the questions which hindered the application of the Convention and in promoting social dialogue in this field.

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A Government representative of Uruguay stated that after having read all of the Committee of Experts' report, he had not considered it possible that his country would be included in the list of individual cases. However, his country had come before the Committee on the Application of Standards to provide information on the application of the Convention in a manner designed to provide firm support for the standard-setting activities of the ILO, its supervisory system and the officials of the Office. He affirmed that the adherence of his country to the ILO system of standards was not empty words or a simple promise for the future. He recalled the dates which illustrated the commitment of his country to the ILO.

He explained that it was essential to take into account the political, institutional and social conditions in his country and described its main characteristics. In particular, the literacy rate, life expectancy and child mortality were comparable with the most developed countries in the world. In Uruguay, there were no ethnic, racial or religious problems, and the annual report of the World Bank in 1997 had recognized that the country had the highest rate of social investments in Latin America and the best income distribution, as stated in the CEPAL report.

This did not mean that there were no problems in his country, but that since its independence, solutions had been sought in a democratic manner to economic and social problems, as illustrated by the following figures: in 1991, inflation had been over 130 per cent per year, while in 1997 it was less than 20 per cent and in 1998 it was expected to fall below 12 per cent; GDP had amounted to $13,800,000 in 1993 and by 1997 had reached $20,000,000, which signified a rise of more than 40 per cent in five years; the unemployment rate had reached 12 per cent in 1996 as a consequence of the adjustment necessary in any regional integration process, such as MERCOSUR, of which Uruguay was a member. However, in March 1998 it had fallen under 10 per cent, giving a further impetus to pursue the measures which had been adopted and the tripartite policy pursued in this area; purchasing power had risen by 3.64 per cent between 1993 to 1997.

He referred to articles 54 and 57 of the Constitution of the Republic which dealt with the right to fair remuneration and the promotion of freedom of association and trade union rights, and accorded privileges, legal personality and the right to strike.

In relation to the comments of the Committee of Experts, the central question was that, according to the workers' organization PIT-CNT, the national minimum wage of the rural workers and domestic workers continued to be determined exclusively by the Executive.

With regard to the national minimum wage, which was determined and adjusted every four months by the Executive, he said that it was necessary to realize that this was not applied in practice, and that its function was not to determine the minimum payment for work, but that it was in reality simply a reference value for the calculation of certain social security benefits. This was confirmed by the statements of the workers' organization concerned, to the effect that the wage is only a political concept, devoid of substance, which served basically to regulate a number of social security measures (including the amount of family allowances and retirement pensions). This feature of the national minimum wage meant that it should not be analysed from the viewpoint of the Convention. Unfortunately, the Committee of Experts had not reproduced in full the comments of the PIT-CNT.

With respect to the minimum wages of rural and domestic workers, he specified that these workers amounted to no more than 15 per cent of the economically active population. The practice, which had been in force for more than 50 years and which had been confirmed by the ratification of Convention No. 98, recognized collective negotiations without any restrictions at the level of an enterprise or a sector of activity, as well as the right of trade unions to the status to conduct these negotiations, without having to have legal personality. Those which had this status could also obtain privileges, such as the exemption from certain taxes. He emphasized that, not only were there no limitations to collective bargaining, but that the procedure was extremely broad and the only formal requirement was that the final agreements should be in writing and registered with the Ministry of Labour and Social Security. This policy and broad legal framework were traditionally used for the determination of wages in his country and corresponded to the provisions of Article 2 of the Convention, which provided that "Subject to the provisions of paragraph 1 of this Article, the freedom of collective bargaining shall be fully respected."

The Government representative considered that it was in this context that one had to consider the fact that it was the Government which fixed and adjusted the minimum wages of rural and domestic workers every four months. This was due to the almost non-existence of representative organizations of employers and workers in these sectors which could conduct negotiations. The Government had played a subsidiary role, establishing a minimum wage which had to be recognized by each employer individually and which extended to social security benefits, including medical care and employment injury insurance, as well as other benefits that were very frequently provided to these categories of workers, such as accommodation and food. All of this corresponded to the content of Article 3 of the Convention.

Notwithstanding the above, it was also evident that when trade unions were developed in these sectors, collective negotiations came to play a more important and concrete role. He referred in this respect to five collective agreements, copies of which were transmitted to the secretariat, which had been concluded by rural workers in 1996-97 and which proved that there existed an effective possibility of negotiating wages and other conditions of work.

The Committee of Experts had requested the Government to indicate the measures taken to determine the wages of these categories of workers in consultation with their representatives, in accordance with Article 4, paragraph 2, of the Convention. In this respect, he reiterated that the normal system of determining wages consisted of collective bargaining and that the Government played a subsidiary role in the event of the absence of representative organizations of employers and workers. It could therefore be said that, in the absence of representative organizations, the Convention required consultations to be held with the representatives of the employers and workers concerned. He inquired whether the Committee of Experts could provide examples of the legal provisions and practices of other countries in this respect, so that suggestions could be made as to how to define the representativeness of employers and workers in the rural and domestic sectors.

The Employers' members recalled that the questions raised in this case concerned the determination of the minimum wage at an appropriate level and the adoption of proper procedures for its determination. The national trade unions complained that the level of the minimum wage was too low. The Employers' members noted with respect that the Government had changed its policy for the fixing of minimum wages since the Committee of Experts had made its previous comments, following changes to the country's economic policy, which was focused on controlling inflation. The Government also stated that the system of determining wages had had a direct impact on inflation, since wages were indexed to the inflation rate every four months on a mobile scale. The Government had also stated that its economic policy had to take into account national undertakings with regard to MERCOSUR. However, the national trade unions maintained that this latter argument was only used as an excuse. In its observation, the Committee of Experts had referred to the requirement set out in the Convention for the needs of workers and their families to be taken into account when determining the level of the minimum wage. The Committee of Experts had therefore requested the Government to indicate to what extent, and by what methods, these criteria were taken into consideration, or whether only macroeconomic criteria were considered in the fixing of minimum wages. The Employers' members emphasized, in this context, that inflation and other macroeconomic factors had a considerable influence on the purchasing power of wages and on employment levels. The Convention included, among the elements to be taken into consideration in determining the level of minimum wages, the desirability of attaining and maintaining a high level of employment, as well as economic factors and levels of productivity. The second issue raised concerned the procedure for the determination of minimum wages. This varied in the country according to the economic sector. In such sectors as transport, health and construction, minimum wages were determined by negotiation. However, for domestic and agricultural workers, their levels were determined by the Executive. In this respect, the Government representative had stated that it was possible to negotiate wage levels in all sectors. Nevertheless, the Government seemed to exercise influence in all sectors, particularly through the indexation of the minimum wage to inflation. The national trade unions claimed that, in violation of the Convention, all minimum wages were in practice determined by the Government, or unilaterally by employers. From the statement of the Government representative, the Employers' members concluded that there remained areas in which the consultation required by the Convention was not fully implemented. On the two issues raised, the Government should therefore be requested to indicate in a written report how the criteria set out in the Convention, and particularly the needs of workers and their families, were taken into account in the fixing of minimum wages. The Government should also be asked to comply with the provisions of the Convention relating to the consultation that was required with the representatives of employers and workers.

The Workers' members thanked the Government representative for the additional information provided in his statement. The Committee of Experts, in its earlier comments, had noted certain progress in the application of the Convention, particularly as regards the fixing of minimum wages for domestic workers. The problems which remained included the obligation to consult with the social partners over the level of minimum wages, which the Committee of Experts had qualified as "essential". According to the Inter-Union Assembly of Workers -- National Convention of Workers (PIT-CNT), the minimum wage was 840 pesos, the equivalent of about US$85. This amount was entirely insufficient to meet the needs of workers and their families. A previous Conference Committee discussion in 1991 dealt with similar issues. In its response to the previous comments made by the Committee of Experts, the Government had insisted on economic factors. The Government representative had confirmed that priority was given to controlling inflation and meeting commitments made within MERCOSUR. Purely economic arguments, which were extremely vague, had already been raised by the Government in the discussion in 1991. The principal preoccupation was still to reduce the budget deficit and control inflation. The references made to agreements within MERCOSUR suggested that the common objective of that common market was to reduce wages and the standard of living of workers. Article 3(a) of the Convention required that consideration be given to the needs of workers and their families in determining the level of minimum wages. Admittedly, it also provided in Article 3(b) that account had to be taken of economic factors. As the Committee of Experts had observed, the Government had taken into consideration only macroeconomic criteria in setting the minimum wage. It also had to take fully into consideration the needs of workers and their families. It should provide explanation on the criteria used, as well as the statistics or studies used as a basis for fixing the minimum wage, since only vague indications of the general orientation of economic policy had been provided in this respect. The other problem raised by the Committee of Experts concerned the absence of consultations. In the first place, the minimum wages of rural and domestic workers were fixed by the Government and not by collective agreements. Furthermore, the Government did not seem to consult organizations of workers or employers. As a consequence of the absence of collective bargaining or consultation, wages in these sectors, which accounted for some 15 per cent of the active population, had declined. The Government also intervened in the setting of minimum wages in the transport and service sectors by invoking the need to limit the impact of wages on the price of these services. The Committee of Experts had emphasized the persistence of the problem of the unilateral fixing of the national minimum wage and of minimum wages for rural and domestic workers. The Government had also failed to fulfil its obligations under Article 4, paragraphs 2 and 3, of the Convention concerning the need for effective consultation in the fixing of minimum wages, involving the participation of representatives of employers' and workers' organizations on an equal footing. The Government therefore needed to take the necessary measures to give effect to this obligation and ensure full consultation of workers' organizations, particularly for the fixing of the national minimum wages and minimum wage for rural and domestic workers.

The Worker member of Uruguay stated that the workers' organizations of his country did not want to be left out of all forms of collective bargaining, including the process of negotiating the national minimum wage. From the statement of the Government representative and the observation of the Committee of Experts, it was evident that the Government did not comply with its obligations deriving from the ratification of the Convention. The scope of the violation of the Convention had to be examined in the light of the non-compliance with Article 3 of the Right to Organise and Collective Bargaining Convention, 1949 (No. 98), which required the Government to establish appropriate instruments to protect the right to organize, as well as in the light of the violations noted by the Committee on Freedom of Association concerning the dismissal of workers for the exercise of trade union rights. In these conditions, to state that minimum wages were fixed through collective bargaining was incorrect. Only those workers' organizations which were sufficiently strong and capable of exercising the right to strike were able to conduct collective bargaining. Public servants, teachers, rural workers and domestic workers, as well as those working in small and medium-sized enterprises, were not able to negotiate collectively. All other workers were subject to individual contracts and the inter-occupational minimum wage, which was determined unilaterally by the Executive by decree, which was an evident violation of the Convention. There were two types of violation of the Convention: formal and substantive. In the first case, no consultations were held with employers' and workers' organizations in fixing the minimum wage. In the second case, the criteria established by Article 3 for determining the minimum wage level were not taken into consideration.

He recalled the legal provisions for fixing occupational minimum wages which were established under Act No. 10449 of 1943. This Act had not been applied from 1968 to 1985. With the return to democracy and up to 1993, wage councils had worked once again. However, since 1994, the minimum wage had been fixed by executive decree, in the same way as under the dictatorship.

The minimum wage currently amounted to $95 per month. The statistical services of the Government recognized that the cost of the consumption basket for a family amounted to $1,789 per month, while the Latin American Economic Commission (CEPAL) had indicated that $280 per month were needed to stay above the poverty line.

In conclusion, he reiterated his belief in tripartism and the ILO and urged the Government of Uruguay without any further delay to fix minimum wages by means of tripartite consultations, taking into account the needs of workers and their families, as required by the Convention, so as to ensure that social justice continued to be observed in Uruguay.

The Worker member of Argentina supported the statement made by the Worker member of Uruguay and repudiated macroeconomic policies which violated minimum wages. He recalled the example of the United States, where the minimum wage had been increased without any adverse effect on the level of inflation or on employment. The Convention, which had been adopted 30 years ago, contained provisions which any democratic political regime had to observe. The authoritarian determination of wages for workers in the rural sector and in domestic service amounted to a denial of tripartite consultations and the participation of the workers' organizations. Nor should the process of economic integration in Latin America in the framework of MERCOSUR be invoked in this respect. No process of integration could be sustainable if it was based on social injustice, the exclusion of workers or the violation of the ILO Conventions. The experience of the European Union was a vivid example of this, and the Conference Committee also had experience in this area.

The Worker member of Brazil said that Uruguay did not comply with the requirements of Article 3 of the Convention. What was worse was that the tripartite consultation required by Article 4, paragraph 2, did not exist.

He indicated that this matter was of particular interest to Brazilian workers, who were currently engaged with other workers of MERCOSUR in negotiating the so-called "social dimension" of MERCOSUR. By decision of the executive body of MERCOSUR, Brazil, Argentina, Uruguay and Paraguay were negotiating in a tripartite manner with a view to formulating a socio-occupational protocol. These negotiations had been directly inspired by ILO Conventions and this was why workers were concerned by the fact that the Government of Uruguay had not complied with the requirement for tripartite consultation in accordance with the Convention.

In concluding, he indicated that the most dangerous indication given by the Government was that the wage negotiations in the past had been responsible for inflation, which was tantamount to saying that tripartism was inflationary. The Committee should urge the Government to engage once again in tripartite negotiations, which had always been part of the democratic history of Uruguay.

The Worker member of Colombia said that for workers and the trade union movement it was incomprehensible that, at the beginning of the twenty-first century, a government refused to establish its wage policy through dialogue, not only for the legal minimum wage, but also for the general wage policy. The workers could not accept the erroneous policy of attempting to control inflation through the reduction of the already low incomes of workers or by the argument that commitments had been made in the context of MERCOSUR. He indicated that Latin American and other developing countries displayed the similarity of the absurd neo-liberal model which was leading to ever greater social inequality because of wage policies which did not take into consideration the basic needs of the workers.

It could not be denied that the Government refused to set minimum wages through negotiations, particularly in sectors which concerned a significant number of workers including small and medium-sized enterprises, rural workers, the commercial and domestic sectors, where workers did not have access to collective bargaining and suffered the impact of the unfair wage policy.

Finally, he called upon the Government to comply with the provisions of the Convention since, if it did not do so, society would lose its faith in international instruments which were so important for the promotion of social justice, such as the Conventions of the ILO.

The Government representative expressed his appreciation of the interventions of all those who had taken part in the discussion, and particularly the Worker member of Uruguay. Leaving aside questions of protocol, he assured the Conference Committee that, in accordance with the usual democratic practice of his country, and in full respect for freedom of expression and tripartite consultation, he would endeavour to give adequate and detailed responses to all the questions that might remain concerning the application of the Convention in his country.

The Committee noted the information given by the Government representative as well as the subsequent detailed discussion. It recalled that this case had been examined in 1991 and on that occasion the Committee had expressed its hope that the Government would take the necessary measures to ensure the full application of the Convention in practice. However, it noted that, despite the time elapsed, there remained problems with regard to the full application in practice of the Convention for fixing the minimum wage, both concerning the criteria of determination and concerning the consultation of employers' and workers' organizations for that purpose. The Committee once again expressed the firm hope that the Government would communicate, in its next report, full information regarding how the Government took into account, among other criteria, the needs of workers and their families in the setting of the minimum wage, in conformity with Article 3 of the Convention and, regarding the measures taken to ensure full consultation -- and on an equal footing -- with representatives of employers and workers concerned with the fixing of the minimum wage, including the minimum wage for rural workers and domestic employees.

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A Government representative stated that in his country there was absolute freedom to conclude collective agreements and to set minimum wages. There were also some cases of administrative decisions taken by the Ministry of Labour with respect to wages in the absence of collective agreements. The speaker indicated that it was an exception, and about 100 per cent of private sector workers had collective agreements which were either medium- or long-term agreements of a two-year duration, which included a mechanism for adjusting wages in order to follow inflation. It was true that the executive power continued to establish a general minimum wage on a unilateral basis, but it was applied only to some residual categories, because the vast majority of private-sector workers had a specific minimum wage that applied to their branch of activity. With reference to rural workers, there was no impediment to fixing the minimum wage by collective agreement, but the dispersion of agricultural workers and their residence in each farm makes organising and negotiating difficult. The speaker further stated that in different sectors where workers are organised (rice, soybeans, lemons and tobacco) the unions negotiated wages. The industrial relations system in Uruguay had a great deal of autonomy, little legislative intervention and allows exclusive consultation producing few conflicts and many agreements.

The Government representative referred to paragraph 98 of the Committee of Experts' report, in which the application of Convention No. 131 by Uruguay was included on the list of cases of progress.

The Workers' members referred to two principal problems. First, in regard to the mechanisms for adjusting minimum wages, they referred to the fact that, as the Government recognised, at least during the first three months of 1990 the minimum wages were fixed unilaterally, without negotiation. Second, there was a disparity between the minimum wages and the consumer price index, and, furthermore, the minimum wage did not appear to increase at the same rate as that of other wages. It seemed to be important for certain categories of workers who received social benefits. The Workers' members emphasised that the Government should adopt the necessary measures, and apply them in such a way that the interested workers' organisations were consulted as to the minimum wage fixing, taking into consideration the elements contained in Article 3 of the Convention.

The Employers' members pointed out that the Committee of Experts took note with satisfaction of the adoption of a Decree establishing a minimum wage for domestic workers. Concerning the extension of collective agreements, they noted that, if there was no such extension, the workers themselves could ask for a collective agreement and for negotiations. With reference to the Workers' members' comments concerning the fact that the minimum wage was lower than the actual inflation rate, the Employers' members considered that other factors should also be taken into account in establishing the minimum wage, so as to draw some kind of balance between social and economic aspects. With regard to the procedure for establishing the minimum wage, they observed that both employers and workers had to be involved to a considerable degree, and noted the Government's declaration to the effect that in the future the correct procedure would be adhered to. The Employers' members considered it appropriate that the Government would provide more detailed information concerning minimum wage fixing in agriculture, where some disputes still existed. They pointed out that the Government needed to establish minimum wages for all these areas, using the procedures laid down in the Convention.

The Workers' member of Uruguay regretted the fact that the problems of application of Conventions Nos. 9, 132 and 98 were not under discussion together with Convention No. 131, and indicated that in his country there was an important regress in wages in general. He expressed his agreement with the Committee of Experts and with the spokesman for the Workers' members in regard to the application of Articles 3 and 4 of the Convention. The speaker considered that in the minimum wage fixing, certain essential aspects of the Convention had been ignored, such as the cost of living and the consultation of workers' organisations. As regards the national minimum wages, he pointed out that the problem was far from being resolved, and that the Government had not put into practice adequate mechanisms of consultation of wage fixing as required by Convention No. 131. He added that the Government transferred the national minimum wage in a wage policy which would be regulated by social security benefits. He believed that the agricultural workers should be accorded the right to have their minimum wage fixed by collective agreement and not by unilateral decision of the Government. The speaker indicated that Decree No. 14.791, which allowed the Government to fix minimum wages unilaterally and not to extend certain collective agreements, was adopted during the period of the dictatorship.

The Employers' member of Uruguay explained that if the national minimum wage was fixed unilaterally by the Government it had importance in its effect in the calculation of benefits. He also added that each sector of activity had its own minimum wage fixed by collective agreements which provided for the adjustment of wages while the agreements are in force, as for example a collective agreement concluded in the textile industry for a period of six years.

The Government made a distinction between the minimum wage in general which was not applied to anyone and the contents of the collective agreements. In the latter case they contain the criteria of the Convention. He highlighted a dialogue which was taking place between the Government and the employers' and workers' organisations. He pointed out that if certain minimum wages were fixed unilaterally, it did not mean that there was no formal and informal procedure at all the levels. He added that in his country there was a tripartite committee in the field of international labour standards. He further added that the minimum wage applied in rural areas greatly increased in the last year.

The Committee took note of the information provided by the Government representative, as well as of the report of the Committee of Experts. The Committee noted that, although some legislative measures had been taken by the Government, it still did not ensure the full application of the Convention in practice by fixing minimum wages in certain cases unilaterally. The Committee trusted that the Government would take the measures necessary in the nearest future, in particular by developing the tripartite dialogue, in order to give full effect both in law and in practice to the provisions of the Convention, and would be able to report about it in its next report.

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The Committee notes the detailed information provided in the Government’s report and the attached documents. It also notes the comments of the Inter-Union Assembly of Workers – National Convention of Workers (PIT–CNT) annexed to the Government’s report.

Articles 1 and 2 of the Convention. System of minimum wages. Further to its previous request for additional information on the minimum wage fixing system, the Committee notes the Government’s indication that there are currently in operation wages boards for 20 occupational categories and 180 subcategories. The Government adds that the near totality of the workers in the private sector are covered by wage boards’ decisions with the exception of domestic workers for whom it has still not been made possible to set up a wage board due to the obvious difficulty of identifying a representative employers’ organization. The Government further adds that, apart from minimum pay rates fixed by wage boards for specific sectors or occupational categories and collectively agreed rates at the enterprise level, a national wage floor is also set and adjusted biannually principally on the basis of the evolution of the inflation rate. In this connection, the Committee notes that the national minimum wage was last revised by Decree No. 28/007 of 26 January 2007 and is currently set at 3,075 Uruguay pesos (approximately US$140) per month, only domestic and agricultural workers being excluded from its scope of application. It also notes that by Decree No. 16/007 of 15 January 2007, a national minimum wage of 3,150 pesos per month, or 16 pesos per hour, was fixed for domestic workers even though no wage board has yet been established for that sector. The Committee requests the Government to keep it informed of any further developments in the field of minimum wage fixing, in particular as regards the establishment of a higher tripartite council and a rural tripartite council to which reference was made in the Government’s last report, and the ongoing discussions for the introduction of collectively negotiated wages for the public administration sector.

Article 5 and Part V of the report form. The Committee notes the information contained in the annual report of the General Labour and Social Security Inspectorate (IGTSS) concerning the number of inspection visits and infringements observed in the period 2005–06. The Committee would be grateful if the Government would continue to supply up to date information on the practical application of the Convention, including for instance statistics on the evolution of the minimum wage rates as compared to the evolution of economic indicators such as the inflation rate, the approximate number of workers or proportion of the country’s workforce remunerated at the minimum wage rate, copies of surveys or official studies serving for tripartite discussions on wage policy and minimum wage fixing, and inspection results referring specifically to minimum wage-related offences.

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The Committee notes with interest the detailed information provided in the Government’s report, in particular the adoption of Decrees Nos. 104/2005 and 105/2005 of 7 March 2005 and Decrees Nos. 138/2005 and 139/2005 of 19 April 2005, all of which relate to the reactivation of wage boards.

1. Minimum wage fixing system. The Committee notes the Government’s indication that wage boards – tripartite bodies envisaged under Act No. 10449 of 1943 – had meetings concerning the public, private and rural sectors, following the adoption of Decrees Nos. 104/2005 and 105/2005 of 7 March 2005, and have been active once again since 2 May 2005. These wage boards have different responsibilities, primarily the fixing of minimum wages by sector of activity, and the determination of occupational categories, but also the formation of sub-boards, inspections of enterprise accounts, participation in the application of laws, conciliation and the establishment of regulations concerning apprenticeship. It also notes that by virtue of Decree No. 170/006 of 8 June 2006, the national minimum wage currently stands at 3,000 pesos (approximately US$132) per month and that annual collective agreements have been concluded in the sectors of health (concerning approximately 35,000 workers), urban transport (approximately 15,000 workers), fisheries (approximately 1,000 workers), and meat packing (approximately 12,000 workers), in order to set minimum wages that are higher than the national minimum wage.

2. Consultation of the social partners. The Committee notes that Decree No. 104/2005 calls upon representative organizations of public servants to engage in bipartite negotiation to discuss a regulatory framework that will make collective bargaining possible in the state sphere and to negotiate wages and conditions for service in the field of public administration. It also notes that Decree No. 105/2005 invites the most representative organizations of employers and workers from the private sector to establish a higher tripartite council which will be, amongst other things, a forum for dialogue on all issues relating to minimum wage fixing. Lastly, the Committee notes that the representative organizations of employers and workers from the rural sector have also been invited to form a rural tripartite council – the functions and mandate of which were redefined in Decree No. 139/2005 of 19 April 2005 – so as to determine the basic criteria that will allow for the implementation and immediate functioning of wage boards in this sector.

The Committee asks the Government to keep it informed of any developments in this area and to provide, in its next report, general information on the application of the Convention in practice, including, for example, statistical data on the number and categories of workers covered by the legislation on the minimum wage; the minimum wage rates in force by sector of the economy and occupational category; copies of studies or inquiries on fluctuations in the economic and social indicators (such as the rate of inflation or the consumer price index) used as the basis for the adjustment of the minimum wage rate; extracts from the annual activity reports of the private sector higher tripartite council and of the rural tripartite council; inspection service reports containing information on the violations reported and the penalties imposed; and any other relevant information that would enable the Committee to assess the manner in which the Convention is applied in the country.

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Further to its previous observations, the Committee notes with satisfaction that the Government has taken significant steps with a view to rationalizing the national minimum wage system and implementing the Convention in a more meaningful manner. It notes, in particular, the adoption of Act No. 17.856 of 20 December 2004 which dissociates the minimum wage from the calculation of social security benefits. According to the terms of the new legislation, a new reference wage (Base de Prestaciones y Contribuciones - BPC) will be used for the determination of social security benefits and contributions and will replace all previous references to the national minimum wage. In this manner, the Government intends to avoid the technical and legal difficulties experienced so far basically due to the fiscal implications of minimum wage increases. The new reference wage will be readjusted depending on the economic situation of the country and will follow the evolution of the consumer price index. The Committee also notes with interest the adoption of the Presidential Decrees of 2 January 2005 by which the national minimum wage rate was increased by almost 50 per cent from 1,310 to 2,050 pesos per month; the minimum wage rate for domestic workers was set at 2,150 pesos per month or 10,75 pesos per hour; and monthly and daily minimum wage rates were fixed for various categories of agricultural workers.

The Committee is satisfied that these positive developments have been made possible with the technical assistance of the Office. In November 2004, for instance, a tripartite workshop was organized at the initiative of the ILO Subregional Office for the South Cone of Latin America to evaluate the functioning of the national minimum wage system in the light of the Committee’s persistent comments and to identify policy options which would allow the national minimum wage to effectively serve as a tool of social protection and poverty reduction.

While noting the recent signs of progress concerning the application of the Convention, the Committee requests once again the Government to indicate whether and how the representative organizations of employers and workers concerned were consulted in relation to the latest increases of minimum wage rates. The Committee would appreciate receiving, in this connection, detailed information on the institutional framework within which such consultations may have taken place and the specific employers’ and workers’ organizations which may have participated in the consultation process. Moreover, the Committee would be grateful if the Government would supply up-to-date information on the evolution of indicators such as the average wage, the inflation rate, or the consumer price index, in recent years in order to enable the Committee to better appreciate whether current minimum wage levels are sufficient to ensure a decent living standard for workers and their families. The Committee expresses the firm hope that the Government will continue its efforts for the establishment of a minimum wage fixing machinery guaranteeing full and regular consultations with the social partners and affording true protection to wage earners with regard to minimum permissible levels of wages.

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The Committee notes the Government’s report and the explanations provided in reply to its previous comments.

The Committee notes the adoption of Decree No. 255 dated 22 July 2004, which increased as from 1 July 2004 the minimum wage at 1,310 pesos per month for all workers except for rural workers, domestic workers and sheep-shearers. It also notes the adoption of the Decree dated 3 August 2004, which readjusted as from 1 July 2004 the monthly and daily minimum wage rates for agricultural workers by occupational category and also set the monthly and daily rates of the board and lodging allowance. Following on its previous observation concerning the real value of such minimum wage rates in terms of purchasing power and their capacity to satisfy the basic needs of workers and their families, the Committee feels obliged to reiterate its request for statistical information on the evolution of the national minimum wage in recent years as compared to the evolution of other economic indicators such as the inflation rate or the consumer price index. The Committee stresses once again that when minimum rates of pay are systematically left to lose most of their value so that they ultimately bear no relationship with the real needs of the workers, minimum wage fixing is in fact reduced to a mere formality devoid of any substance. Moreover, the Committee requests the Government to indicate whether the latest increases in the national minimum wage rates have been the subject of prior consultations with the social partners, and, if so, to specify the employers’ and workers’ organizations consulted and the institutional framework within which such consultations have taken place.

In addition, the Committee notes the Government’s indication that the national minimum wage is not used as a threshold of a decent wage level but rather as a reference for the calculation of numerous benefits payable under the social security regime, such as pensions, family allowances and unemployment benefits. In this connection, the Committee reminds the Government that the primary function of the minimum wage system envisaged in the Convention is to serve as a measure of social protection and to overcome poverty by ensuring a minimum living wage especially for the low-paid, unskilled workers. Therefore, minimum rates of pay that represent only a fraction of the real needs of workers and their families, whatever their subsidiary importance in calculating certain benefits may be, can hardly fit the concept and the rationale of a minimum wage as this arises from the Convention. The Committee accordingly requests the Government to indicate the measures it intends to take to ensure that the national minimum wage fulfils a meaningful role in social policy, which implies that it should not be allowed to fall below a socially acceptable "subsistence level" and that it should maintain its purchasing power in relation to a basic basket of essential consumer goods.

The Committee is encouraged that the Government, with the technical assistance of the Office, currently considers the possibility of dissociating the determination of the minimum wage level from the calculation of the various social security entitlements. It hopes that the Government will take full advantage of the expert advice of the ILO specialists in this regard and that a time-bound programme of action for the establishment of an institutionalized minimum wage-fixing mechanism based on genuine, direct and broad consultations with the social partners will be announced in the very near future.

[The Government is asked to reply in detail to the present comments in 2005.]

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The Committee notes the Government’s report and the observations made by the Inter-Union Assembly of Workers - National Convention of Workers (PIT-CNT) in communications dated 28 May and 5 September 2003. The Committee also notes the discussion in the Conference Committee on the Application of Standards during the 91st Session of the International Labour Conference in June 2003. The Conference Committee indicated in its conclusions that the requirement of meaningful consultations with the social partners in determining minimum wage levels, due regard being taken of the basic needs of workers and their families, is the quintessence of the Convention and that no Government could be relieved of its obligations for reasons of economic policy or expediency. It also expressed concern at the absence of concrete progress in determining minimum wage levels in line with the economic and social realities of the country and also in consulting the social partners for this purpose in an institutionalized form and on a regular basis.

I.  Adjustment of minimum wage rates as a function
of criteria related to the needs of workers and
their families (Article 3 of the Convention)

The Committee refers to its previous comments in which it expressed concern that the minimum wage currently in force does not reflect the needs of workers and their families. The Committee notes the Government’s report in which it states that, while the literal wording of Article 3 of the Convention would make it possible for ratifying States to deviate from the application of the parameters set out therein, it is not the Government’s intention to stray from those criteria. The Committee also notes the comments of the PIT-CNT, according to which the minimum wage is currently equivalent to US$36 a month, while the basket of basic products for a family of three members is equivalent to US$824, which would indicate a total failure to take into consideration the needs of workers and their families in determining the minimum wage.

The Committee has emphasized repeatedly that social criteria cannot be considered in isolation, but have to be assessed in relation to the country’s level of economic and social development, which involves a delicate evaluation process. Nevertheless, without overlooking the economic situation and the specific political conditions of the country, it is essential not to overlook the real objective of the minimum wage system, which is to contribute to the eradication of poverty and ensure a decent living standard for workers and their families. The Committee requests the Government to indicate the manner in which it is ensured that the increases in the minimum wage reflect the basic needs of workers and their families, for example by guaranteeing the maintenance of their purchasing power in relation to a series of specific basic products. The Committee also requests the Government to provide statistical information on the evolution of minimum wage rates in relation to fluctuations in the inflation rate and the consumer price index over recent years.

II.  Obligation of full consultation with the social partners
for the determination of the minimum wage
(Article 4, paragraph 2)

The Committee, while once again reiterating its previous observations that the minimum wage should not be determined without prior consultations with the representative organizations of employers and workers, notes the Government’s explanations that the country is experiencing one of the worst crises in its history, which has caused the closure of enterprises, an increase in poverty and a rise in unemployment and has obliged the Government to implement food assistance plans.

The Committee also notes the Government’s additional comments that the country has a long tradition of consulting employers and workers and that it currently has at least eight tripartite consultative bodies. In this respect, the Committee notes the observations of PIT-CNT that none of the tripartite commissions referred to by the Government have the function of analyzing the determination of minimum wages.

The Committee once again recalls that the obligation to consult the social partners is intended to ensure their real and effective participation in the establishment and modification of minimum wage-fixing machinery and should not be considered a mere formality. The Committee notes that, even in countries in which the organization of employers and workers is in embryonic form or non-existent, Governments should act in such a way that the consultation and participation of the representatives of employers and workers takes place on an equal footing. The Committee requests the Government to indicate the measures that it intends to adopt to give effect to the fundamental principle of the consultation of the social partners in relation to the determination of the minimum wage and to keep it informed of any developments in this respect.

The Committee notes the copy of the Decree provided by the Government dated 27 May 2003, fixing the national minimum wage at 1,170 pesos a month as from 1 May 2003, except for domestic workers, rural workers and sheep-shearers. The Committee regrets that it is bound to note that the Government provided no information in its last report on the determination of the minimum wage applicable to agricultural workers and domestic workers, despite the lengthy comments contained in its last observation. The Committee hopes that the Government will provide precise replies on this point in its next report.

Finally, the Committee notes with interest the Government’s willingness to receive ILO technical assistance and hopes that in this manner the Government will be able to provide indications of progress in the near future in bringing its national law and practice into conformity with the provisions of the Convention.

[The Government is asked to report in detail in 2004.]

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The Committee notes the Government’s report and the extensive and repeated comments submitted by the Inter-Trade Union Assembly - Workers’ National Convention (PIT-CNT).

I.  Elements to be considered in fixing and adjusting minimum wage rates   (Articles 3 and 4, paragraph 1, of the Convention)

1. The Committee notes with regret that, despite its repeated observations, the Government has still not taken the necessary steps to fulfil its obligations under the Convention. In its report, the Government indicates that, in the interests of greater competitiveness and aligning of prices with those of its main partners in MERCOSUR, its policy has been to simplify markets and the factors of production and make them more flexible. Wage fixing by sector of economic activity by the tripartite bodies established in the Wage Councils Act has been abandoned in favour of wage negotiation at enterprise level. The Executive nevertheless retains responsibility for setting the national minimum wage by administrative decision and the minimum wages of rural workers and domestic workers. The Government indicates that the national minimum wage was fixed without reference either to cost-of-living studies or to economic factors, and that its value has declined in recent years in terms of purchasing power. On the basis of the prices of goods and services in the country and studies on household income and expenditure, the Government estimates that the level of the national minimum wage is somewhere between the indigence threshold and the poverty threshold and is sufficient to meet the most basic needs of workers but not those of their families. With regard to families, the Government indicates that workers on the minimum wage in the public sector and the private sector are entitled to family allowances amounting to 16 per cent of the national minimum wage for each dependent child.

2. Noting that there has been no significant change regarding the application of the Convention, the PIT-CNT reiterates its previous comments. It observes that most workers are of the view that there is no minimum wage that meets the criteria of this provision of the Convention, since where there are no collective agreements, the applicable minimum wage is the national one, fixed unilaterally by decree. According to the above organization, the Government’s assertion that the minimum wage is fixed "in reference largely to minimum rates which are applied only for the purpose of calculating social security, professional rates, etc.", shows that the minimum wage takes little account of social reality and is so inadequate as to be non-existent. The above organization also asserts that it can be inferred from the Government’s statements that macroeconomic measures to reduce inflation rates are incompatible with minimum wage fixing by free collective bargaining.

3. The Committee is most concerned by the failure to comply with the provisions of the Convention and its implications for some 875,000 workers and their families whose wages are fixed by administrative decision. It recalls that the ratification of a Convention entails adopting legislative and regulatory measures which must be strictly applied in practice. In the present case, conformity with the Convention means that the minimum wage established in the country must, pursuant to Article 3, as far as is possible and appropriate, take into consideration the needs of workers and their families, taking into account the general level of wages in the country, the cost of living, social security benefits and the relative living standards of other social groups, as well as economic factors. Furthermore, the minimum wage must be adjusted from time to time, in accordance with Article 4, paragraph 1. While sympathetic to the Government’s goals of a more competitive economy and price levels in line with those of its main partners in MERCOSUR, the Committee is nonetheless of the view that the pursuit of competitiveness must not be to the detriment of the Government’s obligations under an international Convention which has been ratified and is in force, and even less to the detriment of minimum wages, which set the minimum standards of living for workers. The Committee notes that, according to the Government, the national minimum wage is by no means representative of the amount earned by someone entering the labour market since no workers are willing to work full time for such a low wage. It observes that such a situation could not arise if, as the Convention requires, account was taken of the real needs of workers and their families in terms of basic commodities and minimum expenditure on education, health and food. The Committee therefore urges the Government to adopt without delay all the measures required to bring national law and practice into line with the spirit and letter of the Convention and to fix the minimum wage taking into consideration, inter alia, the elements set out in Article 3 of the Convention so as to determine a level of minimum wages that is fair, as the Uruguayan constitution itself prescribes.

II.  Failure to consult fully with representative organizations of employers
  and workers concerned on the establishment, operation and
  modification of minimum wages (Article 4, paragraph 2)

4. The Committee recalls that it has been pointing out for years that the national minimum wage and the minimum wages of rural workers and domestic workers are set unilaterally by the Government and that it has accordingly reminded the Government repeatedly that, in connection with the establishment, operation and modification of the wage-fixing machinery, it has an obligation to consult representative organizations of employers and workers concerned or, where no such organizations exist, representatives of employers and workers concerned, as prescribed by Article 4, paragraph 2.

5. The Government indicates in its report that the tripartite system for establishing minimum wages at branch level established by the Wages Council Act has been abandoned in favour of collective or individual wage bargaining preferably at the enterprise level, in which the minimum wages set by the Executive in the various economic sectors must nevertheless be observed. In its last report, the Government states that the national minimum wage was fixed by the Executive without consulting employers’ or workers’ organizations. Regarding the fixing of the minimum wage for domestic work the Government indicates that it was impossible to organize consultations, there being no employers’ or workers’ organizations in this sector. Lastly, with regard to agriculture, the Government indicates that there are only representative organizations of employers in the agricultural and livestock sectors and a few organizations of workers in certain subsectors such as citrus fruits, sugar and tobacco, but none in the stock-raising sector. The Government adds that effective consultations with a view to fixing a minimum wage applying to all rural workers being difficult to organize in such circumstances, the only option was to notify the minimum wage to the one third-level central union, i.e. the PIT-CNT, and the three second-level employers’ organizations.

6. In its latest observations the PIT-CNT reiterates that in all instances where there is no collective agreement, the applicable minimum wage is the national one fixed by decree without consultation of organizations of employers and workers. It further asserts that such organizations do exist even if they do not have state protection for the exercise of their rights. It further states that not only has the Government not sought to encourage collective bargaining, it has also left the labour-related variables of economic adjustment to market forces in an attempt to do away with bargaining and protection of fundamental rights. It adds that the State has introduced a series of restrictions based on macroeconomic considerations without having consulted the occupational organizations concerned.

7. The Committee can but refer to its previous observations in which it recalled that the problem of the unilateral fixation by the Executive of the minimum wage for these categories has persisted for years, and in which it noted the Government’s argument, repeated time and again, that there are no organizations sufficiently representative of such workers. The Committee also notes in this connection the PIT-CNT’s assertion that such organizations do exist, although they have no state protection for the exercise of their rights. The Committee wishes once again to recall and emphasize that, under Article 4, paragraph 2, of the Convention, full consultation with organizations of employers and workers concerned is an obligation which applies both when determining the scope of the minimum wage system and in operating and modifying the wage-fixing machinery. The fact that there are no workers’ or employers’ organizations in a subsector of the economy affords no grounds for non-compliance with the obligation to consult; in such circumstances the obligation could be met by consultation of higher-level organizations of employers and workers concerned, such as federations. The Committee therefore expresses the firm hope that the Government will be in a position to indicate without further delay the measures taken to ensure full consultation with representative organizations of employers and workers concerned for the purpose of fixing the national minimum wage and the minimum wages of rural workers and domestic workers and any other workers in the private sector to whom the provisions on minimum wages apply.

8. According to the PIT-CNT, as well as ignoring national and international rules concerning collective bargaining, the Government also fails to encourage bargaining, invoking macroeconomic reasons and stabilization plans or policies which involve placing restrictions on minimum wage fixing by means of bargaining. The Committee notes in this connection that, according to the Government, in sectors with a widespread culture of collective bargaining such as the construction sector, the Executive can extend the collective agreement to the entire branch by means of regulations.

9. In view of the fact that minimum wages are fixed unilaterally and are very low, and that the system of tripartite councils convened by the Executive has been abandoned in favour of collective or individual bargaining, preferably at enterprise level, the Committee requests the Government to provide with its next report detailed information on the number and categories of workers whose wages are fixed by collective bargaining, together with information on the number of collective agreements concluded by enterprise and by branch, including in the public sector, indicating the sectors and the numbers of workers covered.

10. Lastly, the Committee asks the Government to provide information on the measures adopted to ensure consultation with organizations of workers and employers or, where no such organizations exist, the workers and employers concerned, in fixing the national minimum wage and the minimum wages of rural workers and domestic workers.

[The Government is asked to supply full particulars to the Conference at its 91st Session and to reply in detail to the present comments in 2003.]

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The Committee notes the Government’s report as well as the extensive comments submitted by the Inter-Trade Union Assembly - Workers’ National Convention (PIT-CNT).

Consideration of the needs of workers and their families in
determining minimum wages (Article 3 of the Convention).

The Committee recalls that in its previous comments it referred to the provisions of Act No. 10449 on wages boards mentioned by the Government, considering that although they attempted to meet the workers’ physical, intellectual and moral needs, no reference is made to the needs of workers and their families as provided in Article 3 of the Convention. The Committee therefore requested the Government to indicate the measures taken to ensure that the needs of workers and their families are taken into consideration for the purpose of minimum wage fixing and, more specifically, to indicate whether the minimum wage is calculated on the basis of a basket of staple goods and whether minimum education, health and housing costs are taken into consideration.

In reply to this request, the Government states that the system of wage fixing has ceased to apply integrally for macroeconomic reasons and that the general system provided for all workers, and included in Act No. 10499, is supplemented by decree to fix minimum wages for rural and domestic workers and the so-called minimum national wage. It adds also that these macroeconomic reasons are determined on the basis of the fundamental target of reducing inflationary figures. The Government also states that 80 per cent of national education is provided without charge and that all workers in the private sector have health insurance (D.I.S.S.E) which, by means of contributions from both contracting parties, permits access to health services, without prejudice to amenities under the public health.

In its observations, the PIT-CNT indicates that the great majority of workers consider that no minimum wage exists in terms of the criteria laid down in this provision of the Convention and that when there is no collective agreement the minimum wage applicable is a minimum national wage fixed unilaterally by decree. It also indicates that it can be deduced from the Government’s statements that there is incompatibility between the macroeconomic measures taken to reduce inflation figures and the fixing of minimum wages by free and voluntary collective negotiation. With reference to the failure, for macroeconomic reasons, to apply the wage-fixing system integrally to all workers, it indicates that this government approach must be considered in the light of the responsibility of the State to encourage collective negotiation. The PIT-CNT considers that the Government not only fails to meet the objectives of the collective bargaining system established and in force at national and international level, but that it has ceased to encourage it, arguing that macroeconomic reasons and plans or stabilization policies have involved restrictions on fixing minimum wages by negotiation.

The Committee notes this information and indicates its concern at the Government’s statement to the effect that the fixing of wages by collective bargaining has ceased to apply integrally for macroeconomic reasons and more specifically for the particular objective of reducing inflation levels. The Committee also observes that the Government’s reply refers solely to general aspects of education and national health and notes once again that it does not reply to the specific question of how the basic needs of workers and their families are considered in relation to the national wage level, the price of staple goods, social security benefits and the relative living standard of other social groups, nor does it mention the measures taken in practice. The Committee recalls that minimum wage fixing entails providing wage earners and their families with the necessary social protection as regards minimum permissible wage levels as set down in Paragraph 2 of Recommendation No. 135, and in Article 3 of the Convention. The Committee therefore urges the Government to adopt the necessary measures so that minimum wage-fixing machinery takes into account, in addition to other economic factors, the needs of workers and their families.

Consultation with the representatives of employers
and workers concerned in the fixing of minimum wages
(Article 4(2))

For a number of years, the Committee has noted that the Government follows a practice of unilateral determination of the inter-occupational minimum wage and the minimum wages of rural and domestic workers and has reminded the Government on many occasions that provision must be made by the ratifying State, in connection with the establishment, operation and modification of wage-fixing machinery, for full consultation with the representative organizations of employers and workers concerned, or, where no such organizations exist, representatives of the employers and workers concerned.

In its comments, the Government declares that: (a) minimum wages refer basically to minima applicable only for the calculation of contributions to social security, professional salaries ("aranceles profesionales") etc.; (b) domestic and rural workers are excluded from the wage-fixing system due to the lack of sufficiently representative trade union organizations with which this type of wage can be negotiated; and (c), it has substantially encouraged bargaining by branch of activity and by enterprise without State intervention in order to improve the competitiveness of sectors and undertakings. The Government also refers to its intention initially to prepare draft legislation on collective bargaining which would include the establishment of a tripartite commission for collective bargaining to fix wages of sectors where such bargaining is lacking, and for the minimum national inter-occupational wage, thus complying with the provisions of the Articles. The Government states, however, that this initiative was later abandoned due to disagreement from the employment sectors involved.

The PIT-CNT indicates in its comments that, first, in all cases where there is no collective agreement, the minimum wage applicable is the minimum national wage fixed by decree and without consultation with the workers’ and employers’ organizations, and which the Government claims refers basically to minima which apply only for contributions to social security, professional salaries ("aranceles profesionales"), etc. This affirmation by the Government reveals that the minimum wage is so little based on reality that its inadequacy renders it meaningless. Secondly, the PIT-CNT indicates that the Government justifies the non-applicability of the wage-fixing system by collective bargaining for rural and domestic workers, invoking not only the argument of macroeconomic reasons but also the "absence or virtual absence" of trade union organizations of these workers, which prevents collective bargaining. In regard to the third point relating to the Government’s intention to prepare the draft legislation, the PIT-CNT adds that the lack of consensus between the workers’ and employers’ trade union organizations originates in the attempt of the employers’ organizations to lower the limits imposed by international labour agreements on basic questions in relation to terms and conditions of employment. On these comments, the PIT-CNT reiterates that not only has the Government failed to encourage collective bargaining but that it has attempted to extrapolate the variables of economic adjustment to the employment world with the result that there is neither bargaining nor protection of basic rights. It also adds that the State has formulated a series of restrictions on macroeconomic grounds without these having been the subject of consultation with the representative organizations concerned.

With regard to the consultation of representative organizations of employers and workers in minimum wage-fixing machinery, the Committee recalls that under the provisions of Article 4(2), of the Convention, not only is consultation compulsory but it should also be effected at the time of establishing the scope of the minimum wage system to be established as well as in applying the machinery for fixing minimum wages.

In regard to rural and domestic workers, the Committee notes that for several years the problem has persisted generally of unilateral fixing by the Government of the minimum wage of these workers, on the assumption that there are no trade union organizations sufficiently representative of them. According to the PIT‑CNT, however, such organizations do exist even though they lack State protection in the exercise of their rights. In this respect, the Committee notes that, according to the PIT-CNT comments, in 1990 the percentage of workers covered by collective bargaining amounted to 88 per cent of the total number of workers whereas in 1997 this percentage had dropped to 23 per cent. Citing a study on the new labour relations model, the PIT-CNT indicates that "the withdrawal of the Ministry of Labour from bargaining and the lack of approval of agreements is a disincentive to bargaining at the level of the branches". The Committee expresses the hope that the Government will shortly be in a position to indicate the measures adopted to guarantee full consultation with the representatives of employers and workers concerned in fixing the national minimum wage and the minimum wages of rural and domestic workers. Such measures should include protection of the trade union organizations and the encouragement of collective bargaining.

The Committee hopes that the Government will indicate in detail: (a) what are the components considered in fixing minimum wages for workers, and (b) how consultations have been carried out with the workers’ and employers’ organizations, including those in the agricultural sector and of domestic workers.

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The Committee notes that the Government's report has not been received. It must therefore repeat its previous observation on the following matters:

1. The Committee takes note of the Government's report, as well as the statement made by a Government representative to the Conference Committee on the Application of Standards in 1998 and the discussions which took place on that occasion. Consideration of the needs of workers and their families in determining minimum wages 2. In its previous comments, the Committee requested the Government to indicate to what extent and in what manner the needs of workers and their families are taken into consideration in determining the level of minimum wages, in accordance with Article 3 of the Convention. 3. The Committee observes that, with regard to minimum wage fixing, the Government's report cites a number of provisions of Act No. 10449 which only ensures "a standard of living for the worker sufficient to meet his physical, intellectual and moral needs". The Committee wishes to point out that this provision makes no reference to the needs of workers and their families, as required by Article 3 of the Convention. Furthermore, the Government does not explain the specific manner in which the needs of workers and their families are taken into consideration in practice for the purpose of fixing minimum wages; for example, is the minimum wage calculated on the basis of a basket of essential goods? Is the minimum cost of education, health care and housing taken into account? The Committee strongly hopes that the Government will be able to indicate in its next report the measures taken to ensure that the needs of workers and their families are taken into consideration for the purpose of minimum wage fixing, as well as indicating how in practice those needs are estimated. Lack of consultation of the employers' and workers' representatives concerned in the determination of minimum wages 4. In its previous comments, the Committee - having noted the overall persistence, over many years, of the practice of unilateral determination by the Government of the inter-occupational minimum wage and the minimum wages of rural and domestic workers - expressed the hope that the Government would soon be able to indicate the measures taken to ensure full consultation with the representative organizations of employers and workers concerned in fixing the national minimum wage and the minimum wages of rural and domestic workers, in accordance with the provisions of Article 4, paragraph 2, of the Convention. 5. In reply to these comments, the Government indicates that the national minimum wage is not applied in practice to determine the minimum payment for work, since it is in reality simply a reference value for the calculation of certain social security benefits. According to the Government, this was confirmed by the statement in 1997 of the Inter-Union Assembly of Workers - National Convention of Workers (PIT-CNT), that "... the minimum wage is only a political concept, devoid of substance, which serves basically to regulate a number of social security measures (including the amount of family allowances and retirement pensions)". This feature of the national minimum wage in Uruguay means, according to the Government, that "the wage should not be analysed from the viewpoint of the Convention". 6. The Committee, noting the Government's detailed reply, recalls that, under Article 4, paragraph 2, of the Convention, provision must be made by the ratifying State, in connection with the establishment, operation and modification of wage-fixing machinery, for full consultation with the representative organizations of employers and workers concerned, or, where no such organizations exist, representatives of employers and workers concerned. These provisions do not impose an obligation to negotiate, but do impose an obligation to consult. In the absence of representative organizations of employers and workers, the Government has an obligation to consult representatives of employers and workers concerned. The Committee expresses the firm hope that the Government will adopt the necessary measures in the near future to consult representatives of employers and workers concerned for the purpose of establishing, applying and adjusting minimum wages.

The Committee hopes that the Government will make every effort to take the necessary action in the very near future to give effect to the provisions of the Convention.

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1. The Committee takes note of the Government's report, as well as the statement made by a Government representative to the Conference Committee on the Application of Standards in 1998 and the discussions which took place on that occasion.

Consideration of the needs of workers and their families in determining minimum wages

2. In its previous comments, the Committee requested the Government to indicate to what extent and in what manner the needs of workers and their families are taken into consideration in determining the level of minimum wages, in accordance with Article 3 of the Convention.

3. According to the Government, Article 3 of the Convention is given effect by the provisions of section 1 of Act No. 10449 according to which "the minimum wage is the wage regarded as necessary, in the light of prevailing economic conditions, to ensure a standard of living for the worker sufficient to meet his physical, intellectual and moral needs". The process of fixing minimum wages, whether those established through collective bargaining or those fixed administratively, takes account of this legal provision.

4. The Committee observes that, with regard to minimum wage fixing, the Government's report cites a number of provisions of Act No. 10449 which only ensures "a standard of living for the worker sufficient to meet his physical, intellectual and moral needs". The Committee wishes to point out that this provision makes no reference to the needs of workers and their families, as required by Article 3 of the Convention. Furthermore, the Government does not explain the specific manner in which the needs of workers and their families are taken into consideration in practice for the purpose of fixing minimum wages; for example, is the minimum wage calculated on the basis of a basket of essential goods? Is the minimum cost of education, health care and housing taken into account? The Committee strongly hopes that the Government will be able to indicate in its next report the measures taken to ensure that the needs of workers and their families are taken into consideration for the purpose of minimum wage fixing, as well as indicating how in practice those needs are estimated.

Lack of consultation of the employers' and workers' representatives concerned in the determination of minimum wages

5. In its previous comments, the Committee -- having noted the overall persistence, over many years, of the practice of unilateral determination by the Government of the inter-occupational minimum wage and the minimum wages of rural and domestic workers -- expressed the hope that the Government would soon be able to indicate the measures taken to ensure full consultation with the representative organizations of employers and workers concerned in fixing the national minimum wage and the minimum wages of rural and domestic workers, in accordance with the provisions of Article 4, paragraph 2, of the Convention.

6. In reply to these comments, the Government indicates that the national minimum wage is not applied in practice to determine the minimum payment for work, since it is in reality simply a reference value for the calculation of certain social security benefits. According to the Government, this was confirmed by the statement in 1997 of the Inter-Union Assembly of Workers -- National Convention of Workers (PIT-CNT), that "... the minimum wage is only a political concept, devoid of substance, which serves basically to regulate a number of social security measures (including the amount of family allowances and retirement pensions)". This feature of the national minimum wage in Uruguay means, according to the Government, that "the wage should not be analysed from the viewpoint of the Convention".

7. As regards the minimum wages of rural and domestic workers, the Government points out, firstly, that the country has a complex minimum wage fixing system. On the one hand, it has a general scheme of wage councils established under Act No. 10449 and applicable to all private sector workers. On the other hand, the Executive is limiting the application of the Act in question to particular sectors (public transport, health, construction) and is promoting collective bargaining without state involvement in the other sectors. Lastly, the Executive fixes the minimum wages of rural and domestic workers by decree. The competent administrative authorities for determining the different occupational groups are the Ministry of Labour and Social Security, which has issued a Decree describing the occupations covered by each group, and the National Labour Directorate which, through the Committee for the Classification of Occupations, reclassifies and examines particular cases of new or complex occupations. Relevant Decrees have been issued after obtaining the prior agreement of the representative organizations involved. According to the Government, current national practice, which has been established for over 50 years and has been confirmed in legal terms by the ratification of the Right to Organise and Collective Bargaining Convention, 1949 (No. 98), encourages collective negotiation, without restriction, by company or branch of activity. Procedures are simplified as far as possible, and administrative requirements are set aside if they obstruct collective bargaining, which is the normal procedure for fixing wages in the country from which no sector and no category of workers is excluded. The fact that it is the Government that fixes and adjusts the minimum wages of rural and domestic workers every four months is due to the almost non-existence of representative organizations of employers and workers in these sectors which would conduct negotiations. The Government therefore considers that its role is a subsidiary one of establishing minimum wages that have to be recognized by each employer individually and which extend to social security benefits, including medical care, employment injury insurance, retirement benefits, and other benefits frequently provided for these categories of workers, such as accommodation and food. All of this corresponds to the content of Article 3 of the Convention. The Government recalls its statement to the Conference Committee in 1998 to the effect that there is no obstacle to the development of collective bargaining as representative organizations of employers and workers are established in these sectors, a fact that was confirmed by the presentation of collective agreements concluded by rural workers in 1996-97. In conclusion, the Government states that: (i) the system for fixing and adjusting the wages of rural and domestic workers gives effect to Article 1, paragraph 1, of the Convention in establishing a system of minimum wages applied to diffferent categories of workers, depending on their conditions of employment; where the system is not applicable, those workers are free to negotiate with employers; (ii) at no time has the Government justified the system of fixing and adjusting the wages of rural and domestic workers by referring to agreements made in the context of the Southern Cone Common Market (MERCOSUR); (iii) current wages policy, combined with other measures, has brought about: (a) a fall in inflation from 130 per cent annually in 1991 to less than 20 per cent in 1997; (b) a fall in unemployment from 12 per cent in 1996 to 10 per cent in March 1997; and (c) a 3.64 per cent increase in real wages between 1993 and 1997.

8. The Committee, noting the Government's detailed reply, recalls that, under Article 4, paragraph 2, of the Convention, provision must be made by the ratifying State, in connection with the establishment, operation and modification of wage-fixing machinery, for full consultation with the representative organizations of employers and workers concerned, or, where no such organizations exist, representatives of employers and workers concerned. These provisions do not impose an obligation to negotiate, but do impose an obligation to consult. In the absence of representative organizations of employers and workers, the Government has an obligation to consult representatives of employers and workers concerned. The Committee expresses the firm hope that the Government will adopt the necessary measures in the near future to consult representatives of employers and workers concerned for the purpose of establishing, applying and adjusting minimum wages.

[The Government is asked to report in detail in 1999.

]

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Article 4, paragraph 2, read in conjunction with point V of the report form. The Committee requests the Government to provide information on the operation, in practice, of the wage councils set up pursuant to Act No. 10449.

Furthermore, the Committee notes the information on the minimum wage rates fixed by sector of activity and category of worker, as well as the statistics concerning the activities of the inspection services. It requests the Government to continue to provide general information on the manner in which the Convention is applied in the country, in accordance with point V of the report form.

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The Committee notes the information supplied by the Government in its report as well as the observations submitted by the Inter-Union Assembly of Workers -- National Convention of Workers (PIT-CNT).

Consideration of the needs of workers and their families in determining minimum wages

In its previous comments, the Committee requested the Government to provide information on the working, in practice, of the wage councils established under Act No. 10449 and on the minimum wages fixed by sector of activity and category of workers. The Committee also requested the Government to indicate the measures taken so that elements such as the needs of workers and their families (Article 3 of the Convention) are taken into consideration in determining the level of minimum wages.

The Government states that the policy of determining wages has changed since the Committee made its previous comments, following changes to the country's economic policy which is focused on controlling inflation. It has been noted that the system of determining wages by the wage councils, with participation of the State, had a direct impact on inflation, since inflation was already indexed in the four-month period preceding the determining of minimum wages. The economic policy must also take into account the undertakings made vis-à-vis the Southern Cone Common Market (MERCOSUR)

In its observations, the PIT-CNT considers that the national minimum wage is very inadequate and recalls that it is currently 840 Uruguayan pesos, the equivalent of US$86.35 per month. Furthermore, the minimum wage is used in calculating a series of social benefits (including family allowances and retirement pensions), and for that reason the Government maintains it at extremely low levels. Moreover, according to the PIT-CNT, there are no technical grounds for asserting that the working of the wage councils is really the main source of inflation. The organization stresses that there are no agreements within MERCOSUR for determining joint wage policies or harmonizing such policies; this is simply a pretext put forward by the Government for the purpose of implementing a wage policy geared to reducing wages.

The Committee notes these statements and observations. It refers to paragraph 281 of the 1992 General Survey on minimum wages in which it recalls that the minimum wage must be sufficient for the subsistence needs of workers and their families and that such needs are both a criterion of minimum wage fixing and an objective of the Convention. It notes that, in its statements on the fixing of minimum wages, the Government refers only to macroeconomic criteria. It asks the Government to indicate to what extent and by what methods the needs of workers and their families are taken into consideration in determining minimum wage levels, in accordance with Article 3 of the Convention.

Lack of consultation of the employers' and workers' representatives concerned in the determination of minimum wages

In its previous comments, the Committee asked the Government to indicate the measures taken for consulting the representatives of the employers and workers concerned in determining the national minimum wage and the minimum wage of rural workers, in accordance with Article 4, paragraph 2, of the Convention.

In response to these comments, the Government indicates that, following the change in economic policy for the reasons given earlier (inflation control, commitments under MERCOSUR), minimum wages for the rural sector and domestic service are still fixed by the Executive. For sectors such as public transport, health and construction, minimum wages are fixed through tripartite negotiations; however, in the first two sectors where charging rates exist, the State intervenes to prevent the phenomenon of the indexation of inflation to wages and its repercussion on the cost of these services. As for the other sectors of activity, minimum wages are determined through branch or enterprise collective agreements, negotiated directly between the employers' and workers' organizations concerned.

In its observations, the PIT-CNT considers that the national minimum wage continues to be fixed exclusively by the Executive, and that the social partners (employers and workers) have no opportunity of participating in the minimum wage fixing. This is in flagrant breach of the Convention which lays down the obligation to consult the representative organizations of employers and workers in connection with the establishment, operation and modification of machinery for minimum wage-fixing. The minimum wages of rural workers and domestic workers also continue to be fixed exclusively by the Executive. Lastly, with the increase in the number of workers who have no real opportunity to negotiate, collective bargaining is losing ground and a large proportion of wages are still fixed unilaterally by the employer. As a result, the remuneration of these workers is being reduced and is approaching the national minimum wage.

The Committee notes the above information. It notes the overall persistence, over many years, of the problem of unilateral determination by the Government of the interoccupational minimum wage and the minimum wages of rural and domestic workers without any consultation with the representatives of the employers and workers concerned. It recalls that, in paragraph 186 of its 1992 General Survey on minimum wages, it stressed that one of the essential obligations of the minimum wage instruments is that the minimum wage fixing machinery must be set up and operated in consultation with organizations of employers and workers who must participate on an equal footing.

The Committee hopes that the Government will be able to indicate the measures taken to ensure full consultation with the representative organizations of employers and workers concerned in fixing the national minimum wage and the minimum wages of rural and domestic workers, in accordance with the provisions of Article 4, paragraph 2, of the Convention.

[The Government is asked to report in detail in 1998.]

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Further to its previous comments, the Committee notes the Government's report as well as the discussion that took place at the Conference Committee in June 1991.

In its previous comments the Committee requested the Government to supply information on the measures taken or envisaged: (a) to take into consideration the elements referred to in Article 3(a) of the Convention; (b) to ensure the consultations, in the fixing or reviewing of minimum wages, through wage councils or otherwise; (c) to ensure consultations with workers concerned in establishing the minimum wages of rural workers; and (d) as regards the fixing of the national minimum wage, to ensure consultations and to take into account the elements referred to in Article 3.

A Government representative at the Conference Committee in June 1991 stated that nearly 100 per cent of private sector workers had collective agreements, including a mechanism for adjusting wages, that administrative decisions respecting wages constitute an exception in the absence of collective agreements, and that, although there was no impediment to fixing the minimum wage of rural workers by collective agreement, the dispersion of agricultural workers makes organizing and negotiating difficult.

In its report, the Government indicates that wages are fixed in the system of wages councils under Act No. 10449 which establishes a structure of tripartite negotiations, and that the Executive Power transforms their findings into decrees under Legislative Decree No. 14791. It also indicates that the national minimum wage fixed by the Executive Power applies to practically no workers, because minimum wages fixed for each sector or category of workers are much higher than that. Several Decrees dated between 1991 and 1992 fixing the amount of the national minimum wage are attached to the Government's report.

The Committee notes the above information. It requests the Government to provide further information on the functioning in practice of wages councils under Act No. 10449 and on minimum wages fixed by branches of activity and categories of workers, including, for example, number of workers covered and texts of wages councils decisions respecting minimum wages, whether published in the form of Decree or not. The Committee also requests the Government to indicate measures taken in order that such elements as the needs of workers and their families (Article 3(a)) are taken into consideration in determining the level of minimum wages.

As regards the national minimum wage, the Committee has already noted that it applies to marginal sectors and that it is fixed unilaterally by the Government. The Committee considers that a system of minimum wages, which covers any group of wage earners whose terms of employment are such that coverage would be appropriate, falls within the scope of the Convention, even if the number of persons covered by such a system is small. It therefore hopes that the Government will take measures to consult representatives of employers and workers concerned when fixing the national minimum wage, and to ensure that the elements set out in Article 3 are taken into account.

The Committee notes the Government's repeated indication that the minimum wage of rural workers is unilaterally fixed by the Government because such workers are not sufficiently organized. It recalls that Article 4, paragraph 2, requires consultation with representatives of employers and workers concerned, even if no organizations exist. The Committee therefore again asks the Government, as it already did in earlier comments, to consider adopting measures to ensure that the workers' and employers' representatives are consulted when the minimum wage of rural workers is fixed.

The Committee also requests the Government to communicate copies of any decrees fixing the minimum wages for domestic workers and for rural workers adopted since the Decrees of 1990 noted in the previous comments.

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The Committee notes the information transmitted by the Government in relation to its 1990 observation, as well as the information concerning the practical application of the Convention. It also noted the comments made by the Inter-Union Workers' Assembly - National Workers' Convention (PIT-CNT) concerning the application of Articles 3 and 4 of the Convention, and the Government's observations on these comments. According to these allegations, which were received respectively on 28 February 1990 and 7 March 1990, when fixing minimum wages by branches of activity and categories of employment, Act No. 10449 (respecting minimum wages fixed by collective bargaining in tripartite councils) is applied in form but not in practice; this is because the Government does not follow the procedure established by the Act, but instead fixes minimum wages unilaterally as provided for in Legislative Decree No. 14791. The PIT-CNT states that on various occasions the Government has omitted to convene wage councils and has established the minimum wage by unilateral decision. It also states that the Government has not confirmed any collective agreement that does not comply with its economic guide-lines. The PIT-CNT adds that, even though sufficienctly representative organisations of rural workers exist, the system of wage councils is not applied to these workers, for whom the minimum wage is fixed unilaterally. Finally, it states that the national general minimum wage has fallen behind wages in general. The PIT-CNT also points out that the increases in minimum wages fixed as a result of periodical reviews based on the inflation rates projected by the Government are frequently lower than the actual inflation rate, which is calculated erroneously by the Government.

The Committee also notes from the Government's report that the workers' delegation to the tripartite advisory group on international relations has stated that the national minimum wage, and the wages of rural workers, continue to be fixed unilaterally by the Government, without the participation of the trade unions.

Article 1, paragraph 3, of the Convention. With reference to its previous comment, the Committee notes with satisfaction the adoption of Decree No. 433/990, of 19 September 1990, establishing a minimum wage for domestic workers, both in Montevideo and the interior of the country. It also notes the Decree of 19 September 1990 fixing the minimum wage for rural workers.

Article 2, paragraph 2. The Committee notes that, according to the PIT-CNT, the Government has not confirmed any collective agreement that does not comply with its economic guide-lines. In this connection, the Committee refers to the conclusions of the Committee on Freedom of Association on this question at its November 1989 Session (see 268th Report, Case No. 1460, paragraph 571). The Committee on Freedom of Association pointed out that "in the Uruguayan system, what is referred to as 'confirmation' of a collective agreement is, strictly speaking, an 'extension' of its application to all workers employed in the branch of activity concerned if they do not belong to the signatory trade union organisations or the enterprises to which the collective agreement applies. However, in the event of refusal to extend a collective agreement, nothing appears to prevent the workers who are not covered by the agreement to conclude other collective agreements through their trade union organisations." The Committee on Freedom of Association therefore considered that these allegations did not call for further examination.

Article 3(a). The Committee notes that minimum wages are fixed within the context of the economic plan to reduce inflation and combat the state's fiscal deficit, and that the periodical reviews of wages take into account the fluctuations in the Consumer Price Index (CPI), which is established on the basis of the current values of a basket of goods and services adjusted to the needs of a model family. Finally, it notes the statement that agreements on guide-lines for fixing minimum wages have been concluded recently in "social dialogue bodies" at the highest level of the Government and occupational organisations, which has made it possible to conclude medium- and long-term agreements on wages, with an effective recuperation of real wages.

The Committee notes the Government's comments relating to the Committee's previous observation and the comments of the PIT-CNT, and wishes to point out that, according to the detailed data supplied by the PIT-CNT in its comments, there continues to be a gap between the minimum wages that are fixed and the CPI, which is used as a basis for establishing them. The Committee requests the Government to continue supplying information on the measures that have been adopted to give effect to this Article and, in particular, to take into consideration the needs of workers and their families, taking into account the general level of wages in the country, the cost of living, social security benefits and the relative living standards of other social groups.

Article 4, paragraphs 2 and 3. The Committee notes the Government's explanations concerning the current procedures for establishing minimum wages in the country. The Committee notes that the Government recognises in its comments that, at least for the first quarter of 1990, the minimum wage was fixed unilaterally for some workers, but, after this period, minimum wages were fixed in wage councils by branches of activity and occupational categories. The Committee also notes that, according to the PIT-CNT, within the context of the so-called medium-term agreements, the Ministry of Labour decided that, in the event of employers and workers not reaching agreement, wage reviews would be determined by the percentages that the Government would fix in each case, and that as a result of this, the employers on various occasions made proposals that were unacceptable to the workers or simply did not come to the negotiations, with the consequence that the Government could unilaterally fix the corresponding reviews of minimum wages. The Committee would therefore be grateful if the Government would continue supplying information on the measures that have been adopted to ensure that the organisations of workers concerned are adequately consulted in the fixing or reviewing of minimum wages, either through wage councils or any other procedure that the Government considers to be more appropriate.

The Committee notes that the Government has also stated that the minimum wage of rural workers is established unilaterally since there are no trade union organisations representing all rural workers and these workers are very widely dispersed geographically in their enterprises. The Committee also notes that, according to the PIT-CNT, there are representative organisations of rural workers. The Committee points out that paragraph 2 of this Article contains provisions on this subject. The Committee therefore requests the Government, taking into account the suggestions that it made in its 1990 observation, to supply information on the measures that have been adopted or are contemplated to ensure that the minimum wage of rural workers is established in consultation with the organisations of the workers concerned or with representatives of these workers, as laid down in this Article of this Convention.

The Committee notes that the national minimum wage applies to marginal sectors and also notes that the PIT-CNT agrees with this assertion. However, the Committee notes the Government's acceptance that the minimum wage is fixed unilaterally, that the minimum wage does not appear to increase at the same rate as other minimum wages, that the national minimum wage fixed by virtue of the Decree of 27 September 1990 is lower than the minimum wage that has been fixed for domestic workers in Montevideo (Decree No. 433/990). It also notes that the workers' delegation to the tripartite advisory group on international relations repeats its statement, as contained in the Government's report, that the minimum wage is fixed unilaterally by the Government. The Committee therefore requests the Government to supply information on the measures that have been adopted to ensure, when fixing the national minimum wage, that the workers' organisations concerned are consulted and that the minimum wage takes into account the elements set out in Article 3 of the Convention and, in particular, the needs of workers.

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The Committee takes note of the information provided by the Government in reply to its observation of 1989 which concerned, among other matters, the allegations made by the Inter-Union Workers' Assembly - National Workers' Convention (PIT-CNT) with regard to the application of Articles 3 and 4 of the Convention. The PIT-CNT alleges that the elements referred to in Article 3(a) in connection with the needs of workers and their families, are not taken into consideration in the fixing of the national minimum wage established by decree. It also alleges that the minimum wage of rural workers continues to be fixed by government decree without consultations being held, as required by Article 4 of the Convention, with the employers' and workers' organisations in this sector. The above organisation also indicates that the Government has not created wage councils in the farming, wine-producing, bee-keeping, etc. sectors, as provided for in the legislation, and in particular in Act. No. 13246. The above-mentioned organisation also referred to domestic staff, who continue to be left outside any minimum wage-fixing system.

The Committee takes note of the Government's reply to the above allegations and to the Committee's own previous comments. The Committee takes note of the Government's reply to the above allegations and to the Committee's own previous comments. The Committee also examined the legislation and statistical data appended to the report, concerning wage rates, and wishes to make the following observations:

Article 1, paragraph 3 of the Convention. The Government again refers to the reasons it evoked in its previous report for the exclusion of domestic workers from the coverage of minimum wage legislation. The Committee asked the Government to indicate whether measures were envisaged to ensure that these workers are provided with a system for fixing minimum wages, in accordance with the Convention. In view of this request and the comments made by the PIT-CNT, the Committee hopes that the Government will be able to provide information on the measures planned or envisaged to this effect.

Article 3(a). The Committee notes the Government's indications that the elements taken into consideration in fixing minimum wages through administrative measures include consumer price index movements and forecasts. The Committee gathers that the elements referred to in Article 3(a), i.e. the needs of workers and their families, given the general level of wages in the country, the cost of living, social security benefits, and the relative living standards of other social groups, are apparently not fully taken into account in determining minimum wages. The Committee's impression is reinforced by the comments of the PIT-CNT to the effect that the basic basket, at the time when the comments were made, was 125,000 new pesos and the minimum wage fixed by the Government was 25,000 new pesos. The Committee takes note of the planned increase in the minimum wage of the agricultural sector, mentioned by the Government, and would be grateful if the Government would provide information on the manner in which all the elements mentioned in Article 3(a) are taken into account when the national minimum wage and the minimum wage of rural workers are fixed by administrative measures.

Article 4, paragraphs 2 and 3. The Committee takes note of the information supplied by the Government concerning the manner in which the workers' and employers' organisations participate in fixing minimum wages through tripartite councils. However, the Committee gathers that in determining and adjusting the minimum wages established by decree (national minimum wage and minimum wage in the rural sector) the organisations of workers and employers concerned are not consulted in advance. In view of this information and the comments of the PIT-CNT, to which the Committee has already referred, it asks the Government to consider adopting measures to ensure that the workers' and employers' organisations concerned, or their representatives, are consulted when the national minimum wage and the minimum wage of rural workers are fixed. Another approach might be to amend the provisions of Decree No. 647/978 of 21 November 1978, concerning the rules governing the employment of rural workers, in order to ensure that when the minimum wages of this category of workers are fixed the workers' and employers' organisations concerned are consulted, or the amend Decree No. 178/1985 to include farming among the activities mentioned therein. The Committee requests the Government to indicate the measures taken with regard to either of these possibilities.

The Committee also takes note of the further allegations of the Inter-Union Workers' Assembly - National Workers' Convention (PIT-CNT), dated 9 February 1990, which were transmitted to the Government in a letter dated 2 March 1990. The allegations recall some of the comments made previously by the above organisation, with regard to the application of the Convention and they add that, in determining minimum wages by branch of activity and occupational category, the Government applies Act No. 10449 (minimum wages fixed by collective bargaining in tripartite councils) only formally, but not in substance. It fixes the minimum wages unilaterally, thus applying Legislative Decree No. 14791. The Committee hopes to examine these new allegations once the Government has transmitted comments which it considers pertinent on the above allegations. [The Government is asked to report in detail for the period ending 30 June 1990).]