All Comments

With regard to the promotion of collective bargaining (Articles 4 and 6 of the Convention) and concerning the economic trends before the cancellation of the Basic Collective Agreement (BCA) (2012), the global financial and economic crisis has had a belated effect on the Croatian economy, which was reflected in a considerable decrease in economic activity, a steady decline in the gross domestic product (hereinafter: GDP) and a constant increase in the rate of unemployment, with a subsequent decrease in the citizens’ standard of living. Also, at the end of 2011, the share of the public debt in GDP amounted to 46.7 per cent with a further growth tendency, so that in 2012 it accounted for 55.5 per cent. Given that the deterioration of macroeconomic trends continued during the first half of 2012, it was necessary to further reduce government spending to maintain fiscal consolidation and respect the fiscal rule (whose share increased in the GDP and continued to grow). Consequently, the Government of the Republic of Croatia, under economic circumstances that were continuing to deteriorate, proposed amendments to the BCA during public services negotiations with the trade unions. Eight meetings were held from 4 June 2012 to 16 July 2012. Proposed amendments were aimed at reducing or temporarily suspending the following rights: the right to a Christmas bonus in 2012; the right to a holiday bonus in 2013; and the right to jubilee awards in 2013, except for employees who had been employed for more than 35 years and were retiring in the year to which they were entitled to the bonus; travelling allowances would be reduced from 170 Croatian kuna (HRK) to HRK150; and the method of reimbursement of transport costs to and from work would be regulated differently for the purpose of rationalization. During the negotiations on those amendments to the BCA, which were aimed at avoiding wage adjustments, four of the eight trade unions who had signed the BCA confirmed that they would accept the proposed amendments; the other four had refused to accept them, requesting that the Government commit itself to paying the funds to the public servants in the future. Considering that the BCA envisages the possibility of bringing the dispute before arbitration (article 9), the Government, at the proposal of the four trade unions who had signed the proposed BCA amendments, had, on 17 July 2012, suggested arbitration to the trade unions who had refused to sign the amendments. On 19 July 2012 it appointed its representatives to the arbitration council, while constantly inviting the trade unions to reach an agreement. Those trade unions that had refused to sign the amendments sent a written rejection of the arbitration settlement of the dispute, stating that arbitration was not mandatory. The conciliation procedure was unsuccessful. Article 23 of the BCA provided that the Agreement can be cancelled in writing by both parties in the event of economic circumstances that have significantly changed, after the party cancelling the Agreement had proposed amendments to the other party beforehand, with a notice period of three months. Having exhausted all possibilities of coming to an agreement, based on article 23 of the BCA, the Government, on 17 September 2013, took the decision to revoke the BCA for public service employees with a notice period of three months. The procedures for cancellation were therefore conducted legally. At the same time that the Government was expressing its intention to repeal the existing BCA, it was initiating negotiations on the conclusion of a new BCA, whose text would not change with respect to the text of the revoked BCA. Negotiations would only refer to the issue of the reimbursement of transport costs, whereas the issues of the Christmas bonus, holiday bonus and jubilee award would be settled in an annex to the BCA. The new BCA, with an Annex I, was signed on 12 December 2012, before the cancellation of the previous agreement had entered into force. Collective bargaining was conducted with the bargaining committee of the trade unions established in accordance with the Act on the criteria for participation in tripartite bodies and the representativeness for collective bargaining, which entered into force in the meantime (28 July 2012). It was signed by a total of six out of 11 representative trade unions.

Concerning the act on the suspension of payment of certain benefits to public service employees, despite the conclusion of the new BCA and Annex I (agreement to reduce or temporarily suspend some material benefits), pursuant to the principle in the Labour Code to apply the more favourable law, those rights continued to be applied according to the branch collective agreements, because they had been agreed in branch/sectoral collective agreements for each public service (health care, social welfare, primary and secondary education, science, higher education and culture). Civil servants had negotiated their collective agreement with the Government on 2 August 2012. In Annex I of the collective agreement, inter alia, they agreed that for civil servants, the Christmas bonus would not apply in 2012 and 2013; the holiday bonus and jubilee award would not apply in 2013; and travelling allowances would be reduced from HRK170 to HRK150 (the same was offered to the public service employees). Civil servants in this case were, in practice, discriminated against, since the material rights for both categories were ensured in the state budget. For that reason, the Government decided to regulate the rights contained in Annex I of the BCA equally for all, both civil servants and public service employees, under the Act on the suspension of payment of certain benefits to public service employees of 20 December 2012. On the basis of that Act, the right to a Christmas bonus in 2012 and 2013, and a holiday bonus in 2013, no longer applied. This decision was taken in order to urgently maintain the fiscal stability of the public service system under the deteriorating economic conditions and to achieve a balance in the rights of both categories of officials. In order to bring the branch collective agreements in line with the BCA, the Government entered into negotiations in 2013 with representative trade unions of each public service. In 2013, the collective agreement was concluded for the health-care sector. Collective agreements for the social welfare, culture and primary and secondary education sectors were all concluded in 2014. As yet, no branch collective agreement for science and higher education had been concluded.

With reference to the economic trends in 2013–14, the Government indicated that Croatia was facing a deep and prolonged recession for the sixth consecutive year. The share of the public debt in GDP had increased from 55.5 per cent in 2012 to 64 per cent at the end of 2013. Due to violations of both deficit and debt criteria, the excessive debt procedure within the framework of the European Union (EU) Stability and Growth Pact was initiated in 2014. It was another year of rising unemployment, especially youth unemployment. In the third quarter of 2013, the activity rate for the 15–64 year age group stood at 60.5 per cent, the lowest in the EU, while the employment rate was 50.2 per cent – the second lowest in the EU. The Act on the realization of the state budget of 1993 was no longer in force. With regard to the Act on the criteria for the participation in tripartite bodies and representativeness for collective bargaining, the Government indicated that it had initiated the drafting of the text of the new Act on representativeness in close cooperation with the social partners. After numerous consultations which took place with all representative social partners (representative trade union confederations and the Croatian Employers’ Association), the Ministry of Labour and Pension System initiated the drafting of the new Act of 28 July 2012, which contained improvements. The drafting of this Act was in its final phase. The goal was to promote cooperation among trade unions and strengthen their bargaining positions.

Regarding the protection of workers against acts of anti-union discrimination (Article 1 of the Convention), a comprehensive process of judicial reform had been taking place in Croatia during the past few years, with a view to enhancing the efficiency of the judicial procedure in general and to reducing the backlog of cases. Many laws had been amended; the courts had been restructured and their territorial distribution modified; and information technology had been advancing. Various projects (so-called e-documents) had been implemented to provide the legal protection of the rights of the parties in general, as well as workers. According to statistical data, the number of unresolved cases had dropped considerably in the period from December 2011 to September 2013 – from 872,124 to 773,349 – which demonstrated progress in this field. As regards the strengthening of the capacity of labour inspection, the Labour Inspectorate Act had been adopted and entered into force on 20 February 2014. This Act provided a legal framework for the functioning of inspection bodies in the field of labour. Moreover, the Inspectorate Unit had been established as a separate unit within the Ministry of Labour and Pension System since 1 January 2014. The Labour Inspectorate Act provided a legal basis for the efficient and improved functions of labour inspection bodies. Comments were made by the Trade Union of State and Local Government Employees to the effect that the Local and Regional Self-Government Wage Act of 19 February 2010 restricted the right to organize and bargain collectively over wage fixing, especially in the case of employees of the local and regional self-government units (especially where aid from the state budget for their functioning exceeded 10 per cent of a particular unit’s income). The basis for wage fixing for the calculation of pay of concerned employees was, pursuant to section 9 of the aforementioned Act, determined by collective agreement. Only in cases where the basis was not determined by collective agreement, it was established pursuant to a decision of the local authority official. Section 9 was thus also applicable to the wage-fixing basis in units where aid from the state budget for their functioning exceeded 10 per cent of that unit’s income. However, there was a restriction in section 16 of the Act, which prescribed that in such units the basis for the wage fixing must not be higher than the one for the calculation of pay of civil servants. The solution, at the same time, ensured that local units which did not have sufficient income for their expenses and relied on aid from the state budget for the salaries of the employees, could not increase salaries unproportionally to their income. At the same time, employees were guaranteed protection equal to civil servants. The basis for wage fixing for the salaries of civil servants had been HRK5,108.84 gross, since 1 April 2009. Regarding that issue, the Constitutional Court stated the following: “Section 16 by no means affects social rights and the right/freedom to organize and collective bargaining, nor does it prevent collective bargaining on the wage-fixing basis. The intention of the legislator was that the wage-fixing basis is primarily determined by collective bargaining, and subsequently by the decisions of competent authorities, which is in accordance with the Constitution.”

In addition, before the Committee, a Government representative recalled the impact of the global economic and financial crisis and its negative impact on the economy of Croatia, which was reflected in a steady decline of the Gross Domestic Product (GDP), increased unemployment, reduced salaries and an increased public debt. Under these conditions, negotiations had been held with trade unions in the public service from 4 to 16 July 2012 with a view to amend the Basic Collective Agreement (BCA). Four trade unions had refused to sign the amendments, and had rejected the invitation by the Government to settle disputes through an arbitration procedure provided by the BCA, or through other means. The Government had subsequently cancelled the BCA for public service employees in September 2012, having taken into account all necessary procedures to ensure that the cancellation was legal. At the same time, the Government had, however, expressed its intention to open negotiations for a new BCA. While removing certain rights and bonuses, the new BCA had settled most outstanding issues. The new BCA had been signed in December 2012 by six out of 11 representative trade unions. The abovementioned procedure had been motivated by the necessity to preserve fiscal stability of the public service system while respecting the equality of treatment between public servants on the one hand, and public sector employees on the other. In 2013 the Government had concluded collective agreements in all but one branch. Regarding the issue of representativeness, the Government had submitted a detailed report to the ILO affirming that the Act defined the criteria for establishing representativeness of trade unions for the purposes of collective bargaining. The Government had started drafting the text of a new Act on representativeness, in close collaboration with the social partners, to counter the perceived shortcomings of the current Act, and to promote cooperation among trade unions and strengthen their bargaining positions.

The Worker members recalled that this was the second discussion on Croatia’s application of the Convention and that a complaint was also being examined by the Committee on Freedom of Association. The Committee of Experts was not satisfied with the Government’s responses to the four points it had raised in its observation. The first point concerned the protection of workers against acts of anti-union discrimination. There was an excessive delay in the courts dealing with these complaints and the labour inspectorate did not have the capacity to intervene effectively. Furthermore, the pilot mediation project that had been established had given good results but was not widely used. The second point referred to the process of wage fixing in a number of regional and local communities. When these communities received financial assistance corresponding to a percentage of their income, they had to align themselves with the agreements existing at national level. This legislation appeared contrary to the principle of the right to bargain freely on working conditions. The third critical point concerned the Government’s possibility to amend the substance of a collective agreement in the public service for financial reasons. This contravened the principle that an agreement may not be amended unilaterally. In addition, there was a large body of jurisprudence or the issue of whether an economic crisis or the need to balance public finances justified the amendment of collective agreements by the authorities. The Committee of Experts had already made an observation on this point in 2010, on the basis of this jurisprudence. The fourth and last point related to the application in the public sector of the Act on the criteria for participation in tripartite bodies and the representativeness for collective bargaining (Representativeness Act of 2012). This Act raised concern among the trade union organizations because the procedure to determine this representativeness was complex and confusing and it did not provide the necessary guarantees of impartiality and objectivity required under the Convention. The trade union organizations felt that the bill at present under discussion was even more complex. The Government should confirm its commitment to embark upon an authentic social dialogue, which would involve re-establishing an independent Office for Social Partnership, guaranteeing the effective running of the Social and Economic Council, and creating an independent labour inspectorate. Moreover, it should cease state intervention and the unilateral resiliation of collective agreements and bring the legislation into conformity with the Convention.

The Employer members recalled that the Government would have taken a number of measures when preparing for its recent membership of the European Union. A comprehensive anti-discrimination Act, which included anti-union discrimination had been adopted in 2008. The comments of the Committee of Experts indicated that a comprehensive process of reform had been initiated by the Government to enhance the efficiency of the judicial procedure and reduce the backlog of cases. Moreover, a pilot project on mediation in courts had shown positive results. With regard to local and regional self-government units, Article 6 of the Convention made it clear that the Convention was not intended to apply to, or prejudice, the right of public servants engaged in the administration of the State, distinguishing such public servants from other types of public servants to whom the provisions of the Convention did apply. The Committee of Experts had clarified this distinction in paragraphs 171 and 172 of its 2012 General Survey. In this regard, the Committee of Experts had drawn a distinction between public servants who by their functions were directly employed in the administration of the State, and all other persons employed by the Government, by public enterprises or by autonomous public institutions, who should benefit from the guarantees provided for in the Convention. In this regard, it was important to note that the central Government had the power to limit collective bargaining for local and regional self-government units, which indicated that these units were not autonomous institutions outside of the state administration, but were instead an integral part of the administration of the State. Therefore, employees in these self-government units were indeed civil servants engaged in the authority of the State, and the Government was not required under Article 6 of the Convention to engage in collective bargaining in these units. While noting the non-binding character of the comments made by the Committee of Experts, they invited the Government to consider the above elements in its reply to the Committee of Experts. Regarding the Representativeness Act of 2012, the process of tripartite national discussion was under way.

The Worker member of Croatia underlined the violation of the Convention by the Act on representativeness of 2012, which was adopted without the agreement of the social partners, and which restricted collective agreements to trade unions denominated as “representative” by section 26 of the Act, and possibly restricted the right to strike of other unions. The Act also established derogations in a number of sections of the Labour Code thus restricting the utilization of machinery for voluntary negotiation by unions. The Act established special, different and unjustifiable distinctions between different unions which constituted discrimination. It increased fragmentation of unions and undermined the industrial relations system. Other provisions of the Act undermined union independence and put into question the objectivity of labour authorities, allowing interference into trade union matters which disrupted collective bargaining. These legislative changes had a profound and negative impact on the social dialogue system in the country. Moreover, the BCA had been cancelled, the independent Office for Social Partnership abolished, the tripartite Economic and Social Committee was not functioning, and the once independent labour inspectorate had broken down. Technical assistance by the ILO was required to strengthen tripartism and to implement a genuine system of collective bargaining.

The Worker member of Germany, speaking also on behalf of the Worker member of Poland, underlined that the present laws and policies in Croatia, a Member State of the European Union, substantially violated Convention No. 98, one of the fundamental ILO Conventions that laid the foundation for the Committee’s work: the right to organize. This principle had been under attack in recent years and continued to be under attack at the present Conference, a situation that was unacceptable. In Croatia, the protection of the right to organize was insufficient. Judicial proceedings on cases of anti-union discrimination were being protracted for years before ordinary courts as well as before the Constitutional Court, a situation that amounted to a violation of the right to organize through omission. He called for the acceleration of judicial proceedings and supported the appeal made by the Worker member of Croatia to establish more labour courts, since they were better equipped to consider cases of anti-union discrimination. On the other hand, the right to organize was also actively violated through the adoption of laws such as the Representativeness Act, which established arbitrary criteria for determining which organizations would be considered trade unions. Organizations failing to meet those criteria lost their core functions, namely the right to collective bargaining and the right to strike. The situation illustrated the inherent link between the right to organize and the right to strike and revealed why questioning the right to strike was unacceptable. With reference to the ongoing reform of this Act, the Worker member urged the Government to involve the trade unions in the preparation of the new draft. He also called for the amendment of the draft law on financial obligations for non-profit organizations, which required unions to publicly declare their finances, including their strike fund.

The Worker member of France stated that the Representativeness Act, ostensibly designed to update and reinforce the principle of collective bargaining, actually did the opposite. The Croatian trade unions saw the Act as undermining the credibility of their practices. As the Committee of Experts had recalled in 2010, a legal provision that allowed a party to modify a signed collective agreement unilaterally was contrary to the principles of collective bargaining. If, as it claimed, the Government wanted to “harmonize” the agreements it had signed and make them better reflect the country’s economic situation, then it could not simply “not bother” to consult the social partners and use the economic crisis as an excuse for reducing them to their lowest common denominator and engaged in social dumping. Obliging the parties to renegotiate was contrary to the very principle of collective bargaining and, by extending the period for determining representativeness, the Act had the effect of interrupting or blocking the whole process. The number of complaints about the Act being used to violate collective agreements was steadily increasing, from 6,000 cases in 2011 to more than twice as many in 2012. The Government could not, for any reason whatsoever, simply substitute the Act for the agreements, and the State’s unilateral interference in matters that were governed by collective agreements was tantamount to a breach of the provisions of Convention No. 98. It was important that an end be put to such violations of the Convention.

The Worker member of Hungary stated that there had been no real, meaningful dialogue on the Representativeness Act: it had been adopted despite the clear opposition of the social partners. Neither had the social partners been consulted with regard to the drafting of other important laws, including the Labour Act, the Occupational Safety and Health Act and the Act on financial obligations of non-profit organizations. In 2012, the Government had abolished the Office for Social Partnership without consulting the social partners, and reinvented it as the Autonomous Service for Social Partnership, under the Ministry of Labour and Pension System, thereby depriving it of its independence. The Office for Social Partnership had been formed to provide professional and logistical support to the Economic and Social Council, Croatia’s principle institution for tripartite social dialogue. The Council had not been functioning for nearly a year. Since that change, trade unions and social dialogue had become marginalized; trade unions could only find out about laws and policies relating to employment via the media. The situation in Croatia with regard to social dialogue was not in conformity with the ILO’s basic principle of tripartism. Effective social dialogue was a means to promote better wages and working conditions, peace and social justice. It fostered cooperation and strengthened economic performance. The ILO Global Jobs Pact stated that social dialogue was an invaluable mechanism for the design of policies that fit national priorities. It contributed to sustainable development, good quality jobs and the democratization of social and economic policies. Workers’ voices had to be heard.

An observer representing Public Services International (PSI) expressed serious concern with regard to the actions of the Government in relation to collective bargaining in the public sector. Since the beginning of the financial crisis, the Government had refused to engage in collective bargaining and unilaterally changed conditions of pay and employment. The Government’s austerity measures included outsourcing to companies that were not covered by collective bargaining agreements, privatization of public services and welfare cuts across the board. There was an alternative to such measures: quality public services and social protection floors were conducive to democracy. Countries including Belgium, Iceland, Uruguay and Argentina had demonstrated that collective bargaining and income distribution policies led to both economic recovery and social inclusion. She agreed with the Committee of Experts that a legal provision allowing unilateral modification of the content of signed collective agreements was contrary to the principles of collective bargaining. The Government’s unilateral decision to withhold service bonuses from civil servants was a failure to comply with a relevant collective agreement, and with the agreed procedure for amending the agreement, as well as a contravention of Article 28 of the European Union’s Charter of Fundamental Rights and Article 6 of the Council of Europe’s European Social Charter. In addition, the 2013 General Survey, Collective bargaining in the public service: A way forward underlined the importance of collective bargaining for maintaining effective, professional public services, and the need to respect existing collective agreements in times of crisis. PSI was also concerned by the difficult working conditions in the national health-care system (excessive overtime, staff shortage, reductions in wages). Health-care unions had tried to negotiate a new collective agreement without any result to date. The Government had also intervened in the social dialogue of an electricity company; this had not only made it difficult for unions and management to establish a collective agreement, but was a violation of ILO principles, the European Social Charter and the European Union’s Charter of Fundamental Rights. She called on the Government to change direction and to build trust and dialogue, rather than exclusion and inequality.

The Government representative wished to draw the Committee’s attention to three points. Firstly, regarding the Representativeness Act, the preparation of draft legislation establishing criteria for participation in tripartite bodies and criteria for determining representativeness for collective bargaining purposes, had already begun in 2008. The Government’s attempts to create enabling conditions and encourage social partners to agree on the text of the Representativeness Act had been unsuccessful, for the following reasons. In June 2008, the trade union confederations had assumed the obligation to submit a proposed Act to the Government. In July 2009, in the absence of agreement on the content of the Act, the trade union confederations had proposed that the Government should itself prepare the draft Act, with any disagreements in connection with it to be settled by an arbitration body. However, after the Ministry had prepared two working documents, arbitration had been refused. In 2011, when the draft Act was to be prepared in consultation with the social partners by a group of experts proposed by employers and workers, most trade union confederations had failed to submit their proposals to the experts. The outcome produced by the experts had not been considered acceptable. Following several meetings and consultations with the social partners, the Representativeness Act had been adopted on 28 July 2012. Secondly, she reminded the Committee that the Office for Social Partnership had in fact been a government office, and that, although the Government had indeed abolished it, it had for the first time established a new Ministry of Labour and Pension System – previously labour issues had been dealt with by the Ministry of Economy, Labour and Entrepreneurship. Thirdly, concerning the comments that the Local and Regional Self-Government Wage Act restricted the right to bargain collectively over wage fixation (especially in units where aid from the state budget exceeded 10 per cent of a unit’s income), she indicated that, according to the Act, the wage-fixing basis for the calculation of pay for the employees of all units was determined by collective agreement; only when this was not the case, was it established by the local authority official. However, there was a restriction prescribing that in units where aid from state budget exceeded 10 per cent of the income, the wage-fixing basis did not have to be higher than that for the calculation of pay of civil servants. The purpose was to prevent salaries from increasing disproportionally in units with insufficient income that relied on state aid. In conclusion, the Government representative highlighted that Croatia was in its sixth consecutive year of recession. Unemployment, particularly youth unemployment, lack of investment and fiscal consolidation remained major challenges, and the Government had had to undertake a range of structural reforms. However, it was aware of its responsibility to implement reforms in a socially responsible manner. All measures taken had been aimed at reducing government spending, and rights had been suspended minimally and temporarily. The Government recognized the importance of social dialogue and prioritized collective bargaining as a means of determining the employment conditions of civil servants and other public service employees. Collective agreement coverage in the public sector remained high, and since 2012 the Government had been engaged in ongoing negotiations with civil and public service trade unions, to try and find a balance between necessary measures to address the crisis and protection of workers’ rights. To date, various collective agreements had been concluded: a collective agreement for civil servants, a BCA for public service employees and five agreements for the health care, primary and secondary education, social welfare and culture sectors. The Government would be open to negotiations on the extent of workers’ rights as soon as the fiscal and economic situation improved.

The Worker members were surprised by the Employer members’ renewed questioning of the established interpretations of Conventions in force and emphasized that the Committee of Experts had correctly applied the text of the Convention in the light of the General Survey to which the Employer members had been referring. It seemed that some distrust had developed between the Government and the representative organizations of public service employees and that there were major differences in their respective views. The question was therefore whether the economic and financial difficulties facing the country really justified the revision of granted benefits and, in particular, whether they justified an exemption from the principles laid down by international standards. The Worker members stated that they could only agree with the Government’s objectives. However, there were serious doubts as to whether the latter could be achieved through the existing legislation or the proposed legislation. In order to settle the matter, a thorough examination of the issue should be carried out in order to establish the following: the circumstances which had led to the Government’s withdrawal from the agreement; among other things, the real content and scope of the legislation on representativeness; and, in particular, the way to restore appropriate and substantial dialogue. Accordingly, the Worker members encouraged the Government to avail itself of the ILO’s technical assistance.

The Employer members appreciated the detailed information provided by the Government. They considered it important to highlight that the Committee was examining compliance with the provisions of Convention No. 98 only, and that the European Social Charter was not being discussed by the present Committee. As regards the promotion of collective bargaining in the public sector, they indicated that they had already expressed their concerns about Article 6 and the views of the Committee of Experts. The Employer members believed that, in view of the exemption contained in Article 6 of the Convention, neither the Government of Croatia nor any government was under the obligation to promote collective bargaining in local and regional self-government units. Any restriction applying to those groups of public servants was not within the remit of the Convention. They requested that their views be reflected in the conclusions, so that it was clear why they questioned the observations of the Committee of Experts. Nonetheless, they expected the Government to fully comply with the requirements of the Convention, albeit it was a matter for the Government to decide whether to utilize the exemption in Article 6 of the Convention.

CMNT_TITLE_CAS

Section 95 of the Labour Relations Act of 1992 provides that where two or more trade unions have been formed, the right to represent workers in collective negotiations is laid down by a joint agreement of all the trade unions concerned, and that if no such agreement is reached, representation shall be settled by discussion between the workers of the union which refuses to negotiate and the other unions concerned. Since there are no provisions providing for a mandatory procedure in this respect, Section 95 grants full freedom to trade unions to initiate discussions independently and for trade union members with whom no agreement has been reached to give statements. In their statutes, trade unions shall independently determine means of reaching mutual agreement and of taking statements from their members in the event that no agreement has been reached. If the competent authority were to impose an obligation on trade unions to carry out these proceedings in a manner prescribed by law, this would constitute direct interference by the Government with the relations between trade unions and with their internal structure, as well as limit the freedom to bargain collectively. It is in the interests of trade unions to reach a mutual agreement through collective bargaining as provided for under this Act.

The new draft Labour Act is under consideration for enactment by Parliament. This law will cover collective labour relations comprehensively, ensure the representative role of trade unions in collective bargaining, and will be entirely in accordance with the principles contained in this Convention.

Article 1 of the Convention (Protection against acts of anti-union discrimination). Under Section 87 of the Labour Relations Act, 1992, workers are free to become members of trade unions in order to realize, promote and protect their rights and interests. Workers must not be in a less favourable position because they are members of a trade union or participate in the activities of a trade union. This general provision relates to the prohibition of discrimination and to the protection of all workers, regardless of whether they are or are not members of a trade union, in relation to all work-related rights, such as protection from transfers or dismissal. In view of this general protective provision, such protection need not be particularly emphasized in all cases. The Government referred to its report on the application of the Workers' Representatives Convention (No. 135), 1971, which stated that in addition to the above general provision, additional protection is given to trade union officers. Penal provisions in existing legislation as well as the Labour Relations Act, 1992, that prescribe the amount of fines have been periodically amended because of inflation and the change in the official currency. The Government considered the suggestion of the Committee of Experts to be appropriate, and would take it into consideration when drafting the new legislation.

Article 2 of the Convention (Protection against acts of interference). Under the draft Labour Act, Chapter XIX on trade unions and employers' associations proclaims the right to freedom of association of both workers and employers, and section 176 prohibits supervision by employers and their associations of the establishment and activities of trade unions and of their higher level associations. In the above manner, the future Labour Act will comply with Article 2 of the Convention. Under section 227, item 68 of the draft Labour Act, an employer who attempts to supervise or actually supervises a trade union or a confederation of trade unions shall be punished with a fine of from 5,000 to 20,000 kunas. Trade unions or their confederations are prohibited from attempting to supervise or actually supervising the activities of employers and their associations, but there is no penalty equivalent to that which is assessed against employers and their associations for the corresponding activity.

Article 4 of the Convention (Promotion of collective bargaining). The statement of the Committee with regard to the application of Article 4 of this Convention was not accurate, either because of an incorrect interpretation or an incorrect translation of the Government's report. The Croatian Chamber of Commerce Act, which provides that the Chamber of Commerce has the power to negotiate collectively on behalf of employers, is in force. As the Labour Act has not yet been enacted, present legislation does not regulate the establishment of employers' associations. However, the prerequisites for the creation of an employers' association based on the principle of freedom of association exist by direct implementation of this Convention and in particular of the Constitution. On this basis employers are free to become members of the Croatian Association of Employers, which has entirely replaced the Chamber of Commerce in the area of collective bargaining. The new Basic National Collective Agreement for the Business Sector and Public Enterprises (the Agreement), which follows both in word and spirit this Convention as well as the Freedom of Association and Protection of the Right to Organize Convention (No. 87), 1948, was entered into by trade union associations and the Croatian Association of Employers, and in practical terms excludes the Croatian Chamber of Commerce from collective bargaining. Articles 3 and 4 of the above Agreement provide for freedom of association and activities of both workers and employers as well as the right to become a member on a voluntary basis of any of the organizations that are party to the Agreement. Under article 4 of the Agreement, favourable treatment of a trade union by an employer or pressure by an employer on employees that aims to influence them to become members of a particular trade union or cease to be members of a trade union shall constitute a violation of a right to organize. The Agreement also prohibits interference by any party to the Agreement with the organization and activities of any other party. In this way, the application of Article 2 of this Convention has also been provided for under the above Agreement.

Section 96 of the Labour Relations Act, 1992, provides a procedure for registration of collective agreements which is solely for the purpose of maintaining records of these agreements and examining whether they are in basic accordance with national laws and ILO Conventions. No other examination is to be carried out and no interventions are to be made with respect to the content or scope of the right to bargain collectively. In practice, if a collective agreement is not registered it does not necessarily mean that it cannot be implemented.

With regard to the Government's statement in its report on this Convention to the effect that collective agreements are implemented which have not been registered in accordance with the Labour Relations Act, 1992, the competent Government authorities do not intervene and do not request registration of the agreements if collective agreements reflect the will of the parties that have signed the agreements, and the parties to the agreements are duly fulfilling their obligations under the agreements. This approach is entirely in accordance with the principles of freedom of collective bargaining. Collective agreements that are not registered include the Collective Agreement for Seamen and the Collective Agreement for Health Care. As the Government does not insist on registration of collective agreements, it is unable to determine the precise number of such agreements.

In addition, a Government representative first pointed out that the Republic of Croatia accepted obligations under 54 Conventions of the ILO to which the former Socialist Federal Republic of Yugoslavia had been a party, including Conventions on basic human rights, such as Nos. 87 and 98. In spite of the situation of Croatia, under aggression the war imposed on it, and a part of its territory temporarily occupied, the Government had never brought into question the constitutional guarantee of freedom of association either of workers or of employers, the right to bargain collectively or the right of trade unions and their confederations to use all the legal means to achieve their aims, including strikes.

She noted that the manner in which freedom of association and the right to bargain collectively was regulated in the former Yugoslavia legislation, which Croatia had temporarily adopted with some amendments, was not yet completely in accordance with the standards of Conventions Nos. 87 and 98. Therefore, the Government had introduced, through a social dialogue, a radical change in the entire labour and welfare legislation of Croatia, the most eminent of which was the Labour Act. The Government was convinced that social peace was the most important prerequisite for the stability of the State, which comprised 1,240,000 employed workers, 240,000 unemployed, 840,000 retired and about 600,000 displaced persons and refugees.

Regarding the work on passing the new draft Labour Act mentioned in the written information, as a consensus of the social partners on the content of the provisions of this law had been reached, Parliament passed the new Labour Act on 17 May 1995. The legislation referred to in the observation of the Committee of Experts was therefore outdated. The new law was based on the fundamental assumption of freedom of association and collective bargaining, while it left plenty of space for the parties to a collective agreement to determine all the rights and obligations among themselves. Because of the protection of the employees regarding collective bargaining, the law contained only the provisions which determine the guaranteed level of rights below which the parties to collective bargaining could not go. The comments of the Committee of Experts on the application of the Conventions served as helpful guidelines in the making of this law.

As to the first point of the observation of the Committee of Experts relating to the procedure to establish the representation of the unions where there were two or more unions in the field in which the collective agreement had to be signed, she repeated the Government's view that representation in such a case had to be decided by the unions themselves, and that the interference of the State in this sphere would limit the freedom of collective bargaining. The Government had suggested that the trade unions define the provision themselves and the text proposed by all the union headquarters became the provision of Section 186 of the new Labour Act. Trade unions had independently determined the procedure to establish their representation so that, in the case of the representation of several trade unions or union confederations in the field in which a collective agreement had to be signed, an employer, several employers, an association of employers, or a confederation of employers could negotiate the collective agreement only with a negotiating committee made up of the representatives of those trade unions. The number of members and the composition of the negotiating committee would be decided by the trade unions, but it could not have less than five or more than 11 members. If trade unions could not agree upon the number of members of the negotiating committee, this would be decided by the President of the Economic and Social Council (a national tripartite council) taking account of the number of trade unions in the given field. If the trade unions could not reach agreement on the composition of the negotiating committee, the number of the representatives of each trade union in the committee would be determined proportionally to the number of votes which each of them received in a secret voting of all the members of the trade unions active in the field in which the collective agreement had to be negotiated. The rules and the procedure of election of the negotiating committee would be determined by the trade unions in agreement but, if they did not reach agreement by the date of passing the decision to carry out the elections, these rules would be determined by the Economic and Social Council.

Only trade unions registered for at least six months before passing the decision to carry out the elections had the right to propose candidates for the members of the negotiating committee. Trade unions might agree that, instead of electing the candidates for the negotiating committee in the manner mentioned above, the composition of this committee might be decided by arbitration. The negotiating committee had a mandate to work for the period of time for which the collective agreement had been reached, but not for longer than three years, and it had the authority to determine independently the manner of its work and decision-making. The Government representative emphasized that the above procedure had been defined by trade unions themselves.

As to the second point of the observation of the Committee of Experts concerning the Decree on Wages, the Government representative repeated the explanation on the aim and the reasons for passing this Decree: it was based on the Constitution of the Republic; the social and economic circumstances and the surroundings were characterized by such factors as the situation of neither war nor peace, war damage of tens of billions of dollars, stagnation of production, a constant increase in the number of refugees and displaced persons (10 per cent of the whole population), unemployment and very high inflation. The Government established monetary reforms and carried out programmes of stabilization and economic recovery by cutting inflation to accomplish a real increase in salaries. Another factor was that the collective agreements prescribed by the earlier legislation to be valid for all the employees concerning certain rights, had ceased to be valid. Due to some unrealistic demands and expectations, new collective agreements could not be reached and left a certain void on such matters as salaries.

She stressed that the Decree on Wages had a limited application both in time and in scope. The Decree, which had ceased to be in force on 31 October 1994, contained a provision to become invalid when and if collective agreements were reached. In addition, the Decree referred only to the wages of the employees financed from the state budget. She emphasized the effect that the Decree had in the stabilization of inflation, which justified the decision of the Government. She noted also that the Government had, at the same time, implemented a special social programme to support those with lower incomes. In addition, the Constitutional Court ruled that the Government did not violate the provisions of the right to organize and bargain collectively, or Convention No. 98.

With all the above reasons, she thought that there was no violation of Convention No. 98 and assured that the Government would submit a new report on the Convention by 1 September this year, as well as the text of the new Labour Act.

The Employers' members noted that the Government of Croatia seemed to be there for the first time to explain the application of a Convention which was complex and of a rather promotional character. The legislation regulating collective bargaining used to be very detailed and somewhat confusing, in particular regarding the cases where several trade unions represented the workers in a given sector. This legislation had been abolished but the new provisions also appeared slightly too complicated. This certainly did not suffice for putting an end to a violation of the Convention, which the Committee of Experts explicitly noted. The Government should communicate a report containing information on the application in practice of the new system, together with the new texts.

As to the other point of the observation, concerning a Decree on Wages, the Employers' members noted the Government's explanation that it applied in fact only to the wages financed by the state budget. In view of the probable importance of the public sector in Croatia, it could still cover a large number of workers and seemed to be a form of interference in collective bargaining. The provisions of Article 4 of the Convention were however quite flexible. As to the circumstances and conditions which would authorize, according to the Committee of Experts, a provisional derogation from wage fixation by free collective bargaining, this seemed to be a case of such circumstances. The Government had provided a satisfactory response to the question of the Committee of Experts as to the period of validity of the above Decree, which had ceased to be in force last October. The Government should communicate a report together with the pertinent texts so that the evolution of the situation could be followed.

The Workers' members thought that this case showed the difficulties of the rapid transformation of the economic systems which used to be centralized. Such difficulties were not only a question of practice but could also partially relate to a certain passive mentality.

The first problem concerned the manner in which collective bargaining was, perhaps in too much detail, regulated, which was not to be criticized in itself, although the balance between the establishment of the rules of the game and interference was sometimes delicate. The Committee of Experts should therefore keep a close eye on legislation on the matter.

The Committee of Experts had many times examined the circumstances which would justify a government unilaterally imposing a wage rate without collective bargaining, and usefully clarified them again in this observation. The Workers' members were pleased to note that the Decree on Wages was no longer in force but considered it useful to receive information on the practice that the Government envisaged adopting in future. The Committee of Experts should be attentive to the case until it was fully assured of conformity with the Convention in law and practice.

The Workers' member of Croatia welcomed the abrogation of the 1992 Act, which had contained atrocious provisions and allowed manipulations. The new provisions had been adopted following an agreement with trade union organizations and the explanation given by the Government representative was exact. The trade unions chose to have a unique representation in collective bargaining in order to avoid splitting the organization into pieces while permitting participation of small unions at the same time. The ILO should monitor the practical application of these provisions.

The problem of the Decree on Wages was more complex. It had been promulgated while collective agreements were still in force, and they had not been cancelled in the predicted period. Recourse to the judiciary could not correct the situation because of the slow and inefficient court procedure. This situation of blockage had brought about several strikes in 1994. Parliament had adopted in October 1994 an Act obliging the Government to negotiate wages in the public service but the Government had violated these provisions and the wages of public servants had stagnated, if not decreased. The speaker hoped that, on the basis of the new Labour Act, labour relations would develop in a more positive direction.

The Government representative explained, as regards the Decree on Wages, that even though the collective agreements were in force, the basic wage had never been fixed in them and the Government therefore had to take this measure. She emphasized again that Section 186 of the new Labour Act had been prepared by trade unions and hoped that it was in accordance with Article 4 of the Convention.

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The Committee notes the comments submitted by the International Trade Union Confederation (ITUC) dated 24 August 2010 on the application of the Convention, in particular as regards the impact on collective bargaining of the 2009 Act on the Basis for Wages in Public Services. It also notes the comments made by the Trade Union of State and Local Government Employees (TUSLGE) dated 16 August 2010. The Committee requests the Government to provide its observations thereon in its next report.

Article 1 of the Convention. In its previous observation, the Committee, referring to allegations of excessive court delays in dealing with cases of anti-union discrimination, had noted that a comprehensive process of reform had been initiated to enhance the efficiency of the judicial process and reduce the backlog of cases and that a pilot project on mediation in courts showed positive results. The Committee notes that, while the Government does not provide further information in this respect, the ITUC indicates that there has been an important reduction of the backlog of cases but that procedures remain too long, that monitoring and follow-up by the State Inspectorate and the judicial system of violations of workers’ rights remain weak, and that trade unions call for the establishment of genuine labour courts in order to expedite the resolution of labour conflicts. The Committee requests the Government to provide information in its next report on the progress made with respect to the measures aimed at improving the efficiency of the legal protection, as well as a copy of the instruments adopted as a result of the reform process.

Articles 4 and 6. In its previous observation, the Committee had requested the Government to comment upon the allegations that the Act on Salaries in Public Services limits collective bargaining rights in the public sector by setting coefficients for the workplace, with the result that public sector workers can negotiate on their basic salaries only. The Committee notes the information provided by the Government in its report regarding salaries’ adjustment clauses, in particular, that certain collective agreements include clauses on adjustment of wages according to the economic policy in place, and that others may vary contingent on the level of non-taxable income. The Committee further notes that the TUSLGE indicates that the Local and Regional Self-Government Wage Act of 19 February 2010 restricts the rights to organize and bargain collectively of employees of local and regional self-governments, in particular their right to bargain collectively over the wage formation basis. The Committee requests the Government to provide information thereon in its next report.

Furthermore, the Committee had noted the allegations that the Act on the realization of the Government’s budget of 1993 allows the Government to modify the substance of a collective agreement in the public sector for financial reasons. It had requested the Government to provide a copy of the legislative provisions allowing the Government to modify the substance of collective agreements in the public service and information on their application in practice. Recalling that, in general, a legal provision which allows one party to modify unilaterally the content of signed collective agreements is contrary to the principles of collective bargaining, the Committee once again requests the Government to provide, with its next report, a copy of the said legislative provisions, as well as information on their application in practice.

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Article 1 of the Convention. The Committee notes the comments submitted by the International Trade Union Confederation (ITUC) in a communication dated 26 August 2009 which refer, inter alia, to excess court delays in dealing with cases of anti-union discrimination. The Government indicates, in this respect, that Parliament has adopted a judicial reform strategy and legislative steps have been taken to improve the functioning of the judicial system. Furthermore, a comprehensive process of reform has been initiated to, inter alia, enhance the efficiency of the judicial process and reduce the backlog of cases. There has thus far been a 35.5 per cent reduction in the backlog of cases before the municipal courts. The Government also states that a pilot project on mediation in courts, which offers an alternative means of dispute resolution, is being implemented and has shown positive results. The Committee notes this information and requests the Government to inform it of the progress made with respect to the measures referred to.

Articles 4 and 6 of the Convention. The Committee requests the Government to submit its observations on the ITUC’s comment according to which the Act on salaries in public services also limits collective bargaining rights in the public sector by setting coefficients for the workplace, with the result that public sector workers can negotiate on their basic salaries only.

The Committee had previously noted the ITUC’s allegation that the Act on the realization of the government’s budget of 1993 allows the Government to modify the substance of a collective agreement in the public sector for financial reasons, and had requested the Government to provide a copy of the legislative provisions allowing the Government to modify the substance of collective agreements in the public service and to provide information on their application in practice. The Committee notes with regret that the Government provides no information respecting this matter. Recalling that, in general, a legal provision which allows one party to modify unilaterally the content of signed collective agreements is contrary to the principles of collective bargaining, the Committee once again requests the Government to provide a copy of the said legislative provisions, as well as information on their application in practice.

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The Committee notes the Government’s report. It further notes the comments of the International Trade Union Confederation (ITUC) alleging restrictions on collective bargaining in the public sector and the weakness of the legal system in dealing with cases of anti-union discrimination. The ITUC further refers to the case of a trade unionist unjustly dismissed and not reinstated despite a court order to that effect and to several cases of violations of collective bargaining rights at various enterprises.

While noting with interest the Government’s indication that a Basic Collective Agreement for Public Servants and Employees was concluded in July 2007 and that the Agreement introduced 12 new rights for public service employees, the Committee notes that the ITUC refers to the Act on the Realisation of the Government’s Budget of 1993, which allows the Government to modify the substance of a collective agreement in the public sector for financial reasons. The Committee requests the Government to provide a copy of the legislative provisions allowing the Government to modify the substance of collective agreements in the public service and to provide information on their application in practice. The Committee recalls that, in general, a legal provision which allows one party to modify unilaterally the content of signed collective agreements is contrary to the principles of collective bargaining.

The Committee further requests the Government to provide its observations on the remaining issues raised by the ITUC.

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The Committee takes note of the comments of 10 August 2006 of the International Confederation of Free Trade Unions (ICFTU), referring amongst other things to issues of law and practice relating to the Convention which are already under examination. Furthermore, the ICFTU states that: (1) the law allows the substance of a collective agreement in the public sector to be modified for financial reasons and restricts the subjects that can be negotiated in this sector; and (2) the legal system is too slow and inefficient in dealing with cases of anti-union discrimination. The Committee requests the Government to send its observations on the ICFTU’s comments.

The Committee requests the Government, in the context of the regular reporting cycle, to send its comments for examination at the next session of the Committee, to be held in November-December 2007, on all the issues of law and practice regarding the Convention raised by the Committee in its observation of 2005 (see 2005 observation, 76th Session) which also refer to other comments of the ICFTU.

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The Committee also notes the comments on the application of the Convention submitted by the International Confederation of Free Trade Unions (ICFTU). The ICFTU refers to certain cases of employers obstructing union activity and resisting collective bargaining, states that the law still contains restrictions on collective bargaining in the public sector and stresses slowness in the proceedings in case of anti-union discrimination. The Committee requests the Government to send its observations thereon.

Article 4 of the Convention. The Committee takes note of the Government’s statement that a new collective contract for state officials and employees involving several organizations was concluded on 2 July 2004.

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Article 4 of the Convention. With regard to its previous comments concerning the Supreme Court decision of 7 December 1995, which acknowledged that legislation may modify the substance of a collective agreement concluded for the whole of the public sector, the Committee takes due note of the Government’s statement that it has adopted a new approach for the amendment of collective agreements, based on conciliation and an amicable settlement.

Comments of the Public Services International (PSI) on a possible amendment of the Labour Act detrimental to trade union rights. The Committee notes that the PSI has not forwarded any further comments on the Government’s response to its previous comments as requested by the Committee. The Committee notes from the Government’s previous and current report that certain legislative amendments concerning new coefficients for the calculation of salaries necessitated the renegotiation of collective agreements in the public sector and that the new collective agreement for public servants and officials was signed in December 2001.

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The Committee notes the information provided by the Government in its report, particularly the adoption of Act No. 17/01 amending the current labour legislation. The Committee also notes the communication of 6 July 2001 formulated by Public Services International (PSI), and the Government’s comments on the matters raised therein.

Article 4 of the Convention. In previous comments, the Committee had requested the Government to forward its observations on the decision handed down by the Supreme Court of 7 December 1995, which acknowledged that legislation may modify the substance of a collective agreement concluded for the whole of the public sector. The Committee had also requested the Government to provide information on the measures taken to ensure the promotion of collective bargaining in the public sector with regard to public servants not engaged in the administration of the State. The Government indicates that the right to bargain collectively is evident from the numerous collective agreements that exist in public enterprises and the public sector. The Government mentions certain collective agreements in force both in the public sector and the public service, for example, the Collective Agreement for Civil Servants and Government Employees and the Basic Collective Agreement for Senior Officials and Employees in Public Services. The Committee once again requests the Government to send its comments on the decision of the Supreme Court of 7 December 1995.

The Committee notes that regarding the comments made by the Independent Trade Union of the Croatian Electrical Power Industry and other workers’ organizations concerning the decision handed down on 30 December 1997 restricting the negotiation of pay increases in state enterprises, the Government indicates that this decision was taken to serve as a recommendation for the basic framework for bargaining, and to indicate limits within which standard collective bargaining may be achieved. Furthermore the Committee notes that according to the Government, trade unions are autonomous in collective bargaining and the conclusion of collective agreements. The Committee also notes the Government’s statement to the effect that the Economic and Social Council holds consultations with social partners regarding economic and budgetary policies, including the issue of salaries, for both the public and private sectors.

Comments of the PSI. The PSI states that under the pressure of international financial institutions, the Government unilaterally cancelled collective negotiations with the trade unions of the public sector and has openly stated that these institutions have requested that the recently enacted Labour Act be modified in order to restrict significantly labour and union rights. According to the PSI, the agenda of the Government includes new proposals for laws which are detrimental to social rights. The Government indicates in this regard that these proposals concern new parameters for the calculation of salaries and that they were submitted to the trade unions concerned in the procedures for proposing and adopting the new laws. The coefficients established by the new law could be applied only upon modification of the salary base that was established by the collective agreements. The new laws provide that the salary base will be established by collective agreements. The trade unions failed to reach an agreement as to the composition of the negotiating committee and following the applicable legal procedure, a decision was taken by the Vice-President of the Economic and Social Council. The conclusion of the collective agreement for public services has not yet been concluded. Separate negotiations will take place, in particular in the public services, taking into account their specificities.

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Article 4 of the Convention. 1. The Committee previously had requested the Government to forward its observations on the decision handed down by the Supreme Court of 7 December 1995 which acknowledged that legislation may modify the substance of a collective agreement concluded for the whole of the public sector. The Committee had requested the Government to provide information on the measures taken to ensure the promotion of free collective bargaining in the public sector with regard to public servants not engaged in the administration of the State. The Committee notes that the Government's report makes no mention of these points and once again requests the Government to provide information in this regard.

2. The Committee notes that the Independent Trade Union of the Croatian Electrical Power Industry and other workers' organizations had presented comments on the application of the Convention and, in particular, the restrictions placed on negotiating pay increases in state enterprises and undertakings through collective bargaining, as a consequence of the decision handed down on 30 December 1997 respecting the application of the remuneration policy. The Committee notes that the Government indicates that since it was the legal authority empowered to administer "state goods", it had taken a series of measures intended for public undertakings which were the property of the State. These measures took the form of proposals and neither impeded nor encumbered the rights of workers; rather, they served as guidelines which employers applied when negotiating pay awards for 1998. The Government considers that employers, to the extent possible, will negotiate wages having due regard to these guidelines. The Committee recalls that legislative provisions are compatible with the Convention where they allow Parliament or the competent budgetary authority to establish an overall open "budgetary package" for wage negotiations provided they leave a significant role to collective bargaining. It is essential, however, that workers and their organizations be able to participate fully and meaningfully in designing this overall bargaining framework (see the 1994 General Survey on freedom of association and collective bargaining, paragraph 263). The Committee lacks sufficient information to establish whether, in the present case, workers' organizations were consulted and requests the Government to ensure that prior to fixing wage rates in guidelines trade union organizations are consulted and that these levels, in fact, leave a significant role to collective bargaining by the parties concerned.

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The Committee notes the comments made by the Union of Autonomous Trade Unions of Croatia (UATUC), the Independent Trade Union of the Croatian Electrical Power Industry and other workers' organizations as well as the Government's reply in this respect.

Articles 1, 2 and 3 of the Convention. 1. The UATUC alleges that although the Act respecting labour relations lays down sanctions against employers as legal entities, in practice these sanctions are not being applied since the complaints brought against employers have been rejected on the grounds that employers, as legal entities, are not liable for petty offences. The Government states that legislation respecting petty offences does not recognize the responsibility of legal entities. Nevertheless, the Government points out that supervision of the application of the labour legislation falls within the competence of the labour inspectorate and that employers have been and are continuing to be punished for non-compliance of this legislation under the Labour Inspection Act. Moreover, the Committee notes that the Labour Act establishes protection against acts of anti-union discrimination and acts of interference which are accompanied by penal sanctions and fines ranging from 5,000 to 20,000 kunas (section 228 of the Labour Act). In this respect, the Committee considers that the labour legislation provides sufficient protection against acts of anti-union discrimination and interference.

2. The UATUC states that there have been certain instances where the authorities or employers have favoured a workers' organization to the detriment of other organizations and cites the example of the Labud enterprise, whose management favoured the Croatian Association of Trade Unions (HUS). The UATUC also states that the Zagreb local authorities had made financial contributions to trade union activities, one example of which is the International Labour Day celebrations organized by the URSH trade union confederation. The Committee notes that UATUC has not provided specific information, without which the Committee is unable to determine whether, in the above instances, the authorities or the employers committed acts of interference and violated Article 2 of the Convention. Lacking such information, the Committee cannot proceed with its examination of these questions.

Article 4. 1. The UATUC alleges that under section 186 of the Labour Act, an employer may avoid collective bargaining and obstruct the use of collective bargaining machinery by making use of right-wing trade unions. The UATUC states that where a trade union refuses to take a collective trade union position, the Labour Act provides for a ballot to be held. However, since the Act does not lay down the procedure to follow in the event of a ballot or who may participate in the ballot, the ballot can not take place. The Government states that: (i) all trade unions in Croatia agreed to the provisions laid down in section 186 and stipulated the Government's acceptance of this provision as a condition of the enactment of the Labour Act; (ii) section 186 may be applied in practice if interpreted correctly; (iii) if all trade unions represented in the bargaining unit are dissatisfied with the negotiations and do not wish to accept the collective agreement, the employer may conclude the agreement with those trade unions who wish to sign the agreement. The Committee notes that section 186 provides that: (1) a collective bargaining unit may be established if a trade union or a higher-level organization is present in the territory in which a collective agreement is to be concluded; (2) this bargaining unit shall be composed of representatives of those trade unions who shall stipulate the number and the composition of the collective bargaining unit; (3) if trade unions are unable to agree on the composition of the collective bargaining unit, the number of representatives of each trade union participating in the bargaining unit shall be established in accordance with the number of votes cast for each trade union; (4) all trade union members who are active in a territory for which a collective agreement is to be negotiated shall participate in the ballot; (5) the rules and the criteria for electing members to the collective bargaining unit shall be established by a consensus of all the trade unions and if no agreement exists when the elections take place, it shall fall upon the Economic and Social Council to do so; (6) the parties concerned may decide that the members of the collective bargaining units shall not be elected by ballot and shall authorize an industrial tribunal to issue a decision in this regard. Following its examination of section 186 of the Labour Act, the Committee considers that this provision is in conformity with the Convention. Moreover, in its previous report the Government had stated that only bargaining units were established within the collective bargaining framework in respect of public servants and employees. Finally, in the event that an employer uses right-wing trade unions in the collective bargaining process, national legislation lays down adequate sanctions as stated above.

2. The UATUC states that as a consequence of the interpretation given by the Ministry of Labour on 12 February 1996 to all the collective agreements concluded with the Croatian Chamber of Commerce or with its departments these collective agreements were declared null and void as of 1 January 1996, due to the fact that the Chamber of Commerce is an employers' association in which affiliation was compulsory. Consequently, no new agreements have been concluded between the trade union and the relatively small employers' association, which has resulted in a number of trade union organizations petitioning the courts for the recognition of the rights guaranteed in the collective agreements in question. The Government states, in this respect, that: (1) the decision issued by the Ministry of Labour refers to collective agreements concluded by the Croatian Chamber of Commerce as employer -- which did not contain an expiration clause; (2) the Chamber of Commerce was established by law and membership was obligatory; (3) only employers' associations who adhere to the principle of freedom of association and who comply with international standards and labour legislation may conclude an agreement; and (4) several collective agreements have been concluded with the Chamber of Commerce and negotiations are under way with a view to concluding new collective agreements. Under these circumstances and taking into account the principle of freedom of association which applies to both workers' and employers' organizations and the new agreements which have been concluded by the Government in distinct areas of activities, giving rise to negotiations to conclude other agreements, the Committee shall not proceed with its examination of these questions.

Moreover, the Committee notes that the Independent Trade Union of the Electrical Industry of Croatia and other workers' organizations have submitted comments with regard to the application of the Convention in respect of the restrictions on the possibility of bargaining collectively to obtain wage increases in state enterprises and corporations, by virtue of the adoption, on 30 December 1997, of the decision respecting compulsory instructions for the implementation of a remuneration policy, published in the Official Gazette No. 142/97. The Committee requests the Government to comment in this respect.

Finally, the Committee proposes to examine the remaining questions raised in its observation of 1997 during its next meeting within the framework of the regular reporting cycle.

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The Committee takes note of the information furnished by the Government in response to its previous observation.

However, the Committee understands that, in a decision of 7 December 1995, the Supreme Court has stated that a law can modify the substance of a collective agreement concluded for the whole of the public sector.

The Committee recalls in this respect that under the terms of Article 4 of the Convention, the public authorities should promote collective bargaining. Moreover, this provision emphasizes the voluntary nature of negotiation. In the Committee's view, the intervention of the public authorities in the implementation of collective agreements constitutes a violation of this provision.

The Committee requests the Government to provide information on this decision of the Supreme Court and on the measures taken to ensure the promotion of collective bargaining in the public sector with regard to public servants not engaged in the administration of the State who are covered by the Convention.

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Article 1 of the Convention. The Committee notes that the Labour Relations Act of 29 April 1992 in section 87 only establishes that a worker may not be placed in an unfavourable position due to membership or non-membership of a trade union or participation in the activities of a trade union. It does not refer to other possible types of discrimination such as dismissal, transfer to another location, transfer to another job, etc. In this connection, the Committee reminds the Government that Article 1 of the Convention implies that workers must enjoy adequate protection against all acts of anti-union discrimination both at the time of recruitment and in the course of employment, and asks the Government to do its utmost to bring its legislation into conformity with this principle.

The Committee also observes that under section 117(9) of the Act, failure to comply with section 87 may be penalized by a fine (of a maximum of 40,000 dinars). In this connection the Committee draws the Government's attention to the fact that although such a measure can have a dissuasive effect, in an inflationary situation the established amounts may lose their power of dissuasion. The Committee suggests that the Government might envisage setting the fines as a multiple of the appropriate minimum wage.

Article 4. The Committee notes that in its report the Government states that the Republic of Croatia is still in a period of transition from social ownership to private or public ownership and it is therefore impossible for the trade unions to find adequate bargaining partners since there are no private employers or employers' associations, and that in order to cooperate in this process, the Croatian Chamber of Commerce Act (published in Official Gazette No. 66/91) provides that any natural or legal person carrying out an economic activity and having its headquarters in the territory of the Republic of Croatia must join the Chamber of Commerce. The Committee also notes the Government's statement that that Chamber has been designated as the employers' association with the legal power to prepare, conclude and supervise the application of collective agreements. In this connection, the Committee asks the Government to state whether individual employers or their organizations may be party to negotiations and to provide the text of the above Act.

The Committee observes that the Labour Relations Act of 29 April 1992 provides in section 96 that in the collective agreement registration process the Minister of Labour can start proceedings before the competent body for the removal from a collective agreement of any provisions which are inconsistent with the law, a general collective agreement or a corresponding international Convention. In this connection the Committee reminds the Government that provisions for the approval by an administrative authority of collective agreements are consistent with Convention No. 98, provided that the rejection of applications is restricted to those cases in which the collective agreement has a formal flaw or infringes the minimum rules laid down by general labour legislation. It asks the Government to provide information on the practical application of this provision, in order to confirm that section 96 does not confer any discretionary powers on the administrative authorities.

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The Committee takes note of the report of the Government as well as the information supplied to the Conference Committee in June 1995 and the discussion which took place there.

The Committee notes with interest the adoption on 17 May 1995 of a new Labour Law (Narodne novine 38/95) which will enter into force as of 1 January 1996 and the provisions of which are generally in compliance with the Convention.

Articles 1 and 2 of the Convention. With regard to the protection against acts of anti-union discrimination, the Committee requests the Government to specify if in the case of violation of sections 160 and 180, the penalties prescribed by section 228 apply since these provisions are not specifically mentioned.

Furthermore, as regards the penal provisions prescribing the actual amount of fines, the Committee, while noting with interest the Government's statement in its report to the effect that these provisions have been periodically amended due to inflation and the change of the official currency of the Republic of Croatia, draws to the Government's attention the importance it attaches to adapting monetary penalties, in such a way that they exert an effective deterrent against acts contrary to the guarantees laid down by the Convention. The Committee therefore asks the Government to continue taking measures to adapt monetary penalties from time to time or to determine the amount of such penalties in such a way as to take account of currency fluctuation and to supply in its report information on any development in this regard.

Article 4. With regard to the registration of employees' and employers' associations as prescribed by the new Labour Law, the Committee requests the Government to give details in its next report of any appeal lodged before an administrative tribunal against a decision denying registration to an association has suspensive effect (section 173).

Finally, as regards trade union collective negotiations committees set up in accordance with section 186 of the new Labour Law, the Committee observes that it covers collective negotiations at national level when more than one trade union or higher level association exists. The Committee therefore requests the Government to indicate in its next report the possibility granted to trade unions to negotiate collectively at the enterprise level or branch of activity.

The Committee asks the Government to provide, with its next report, a copy of the new Labour Act and of the decision of the Constitutional Court in response to a complaint lodged by the Federation of Independent Unions of Croatia against the Decree on Wages of 3 October 1993.

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The Committee takes note of the report of the Government as well as of the information supplied to the Conference Committee in June 1995 and the discussion which took place thereafter.

The Committee takes due note of the information provided by the Government representative at the Conference Committee to the effect that the Decree on Wages of 3 October 1993 which contains a provision stating that it would become invalid if collective agreements were reached, expired on 31 October 1994. The Committee therefore requests the Government to provide it with a copy of the new Basic National Collective Agreement for the Business Sector and Public Enterprises and any other collective agreements actually in force.

Articles 1 and 2 of the Convention. With regard to the protection against acts of anti-union discrimination, the Committee notes that specific provisions of the new Labour Law clearly state that no one shall be discriminated against because of his or her membership or non-membership of an association (sections 2, 108, 160 and 180). As regards protection against acts of interference, the Committee observes that employers and their associations do not have a right to control the establishment and operation of trade unions or their higher level associations, nor can they legally finance or in another way support trade unions or their higher level association in order to control them (section 177). Both protections against acts of anti-union discrimination and acts of interference are accompanied by penal sanctions ranging from 5,000 to 20,000 kunas in case of violation (section 228).

Article 4. As regards the measures put in place in order to encourage voluntary collective negotiations, the Committee observes that a joint trade union collective negotiations committee is set up if more than one trade union, or higher level association is present in a territory where a collective agreement is to be concluded (section 186). This committee is composed of representatives of those trade unions who shall set the number and composition of the collective negotiations committee. If trade unions are unable to reach an agreement as to the composition of the collective negotiations committee, the number of representatives of each trade union participating in the committee shall be set in accordance with the number of votes cast for a respective trade union. All members of all trade unions who are active in a territory for which a collective agreement is to be negotiated shall participate in the ballot. The Government adds in its report that the wording of section 186 was proposed by all-union headquarters, allowing therefore the unions to define the way in which their representation should be established. The Committee requests the Government to provide information in the application in practice of these provisions and to give details of the circumstances in which such negotiations committees have been set up, the territories and the number of workers covered and the outcome of the negotiations.

The Committee is also addressing a direct request to the Government.

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The Committee notes the information supplied by the Government in its first report on the application of the Convention. The Committee also notes the comments made by the Autonomous Trade Unions of Croatia and the Government's observations in this regard.

First, the Committee observes that the Autonomous Trade Unions of Croatia refers to problems in the application of section 95 of the 1992 Labour Relations Act, which provides that in the event that two or more trade unions have been formed, the right to represent the workers in collective negotiations is laid down by a joint agreement of all the trade unions concerned, and that if no such agreement is reached, representation shall be settled by discussion between the workers of the union which refuses to negotiate and the other unions concerned. The above organization complains that this provision does not specify who is to organize the discussions for taking decisions, or in what manner, or what is to be done in the event of a negative decision. The organization also states that, the fact that more than 70 trade unions have to reach an agreement may mean that failure to agree on the part of one of them may jeopardize the negotiation of a collective agreement.

Although the above provision does not appear to infringe the right of trade unions to negotiate collectively, it is not conducive to collective bargaining within the meaning of Article 4 of the Convention. It would therefore be advisable for the legislation to establish that, if the unions do not reach an agreement, they shall at least have the right to conclude agreements on behalf of their members, or to provide for conciliation procedures. The Committee asks the Government to take all necessary steps to bring its legislation into closer conformity with the Convention, and to keep it informed of developments.

Secondly, the Committee notes that the Autonomous Trade Unions of Croatia complains about the promulgation of the Decree on wages of 3 October 1993, which imposes a minimum wage, and indicates that the latter is to serve as a basis for determining the wages of all workers. The Committee notes the Government's statements in connection with the Decree that: (1) it was promulgated because the collective agreements with clauses on this subject had expired and the parties had failed to conclude new agreements; (2) the trade union federations were consulted but their proposals were not accepted because in the present state of the economy of the Republic of Croatia this would have endangered the Government's efforts to curb inflation and improve the national economy by means of the stabilization programme; (3) it regulates the public sector; (4) it was issued in the context of an economic stabilization programme and a social programme for maintaining the standard of living; and (5) it was issued on a temporary basis.

In this connection the Committee reminds the Government that if, as part of an economic stabilization or structural adjustment policy (i.e. for unavoidable reasons of national and economic interest) a government provides that wage rates may not be fixed freely by collective bargaining, this restriction must be applied as an exceptional measure and limited to what is essential, must not exceed a reasonable period and must be accompanied by guarantees for the effective protection of the living standards of the workers concerned. The Committee hopes that in the future the independence of the parties will be maintained when working conditions are negotiated (and that wage rates may be fixed through collective negotiation), and asks the Government to state whether the period of validity of the above-mentioned Decree has been extended and, if so, until when.

The Committee is also sending the Government a direct request.

Right to Organise and Collective Bargaining Convention, 1949 (No. 98) - Croatia (RATIFICATION: 1991)

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Follow-up to the discussion of the Committee on the Application of Standards (International Labour Conference, 103rd Session, May–June 2014)

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Follow-up to the discussion of the Committee on the Application of Standards (International Labour Conference, 103rd Session, May–June 2014)

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