Report in which the committee requests to be kept informed of development - Report No 333, March 2004

1. 278. The Committee examined this case at its November 2002 meeting and adopted an interim report [see 329th Report, paras. 316-356, approved by the Governing Body at its 285th Session (November 2002)].
2. 279. The Government sent, on 5 May 2003, the comments, dated February 2003, of the Confederation of Production and Trade, and provided additional observations in a communication dated 12 January 2004.
3. 280. Chile has ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), and the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. Previous examination of the case

1. 281. At its November 2002 meeting, the Committee noted the Government’s statements [see 329th Report, para. 349], which confirmed that:
   • – the action entitled “work-to-rule” taken by the trade union consisted in fulfilling the provisions of aeronautical regulations to the letter, which obviously did not involve the infringement of applicable standards; no contractual or legal standards were violated;
   • – between 14 September and 4 October 2001, the enterprise dismissed 108 trade union members. In 23 of these cases, the enterprise invoked “company requirements” and in 85cases it involved a “serious breach of contractual obligations”. However, in these 85 cases, there is a clear relationship between the delays and the breaches in contractual obligations (or internal regulations). Following the dismissal of these 85 workers, the company reinstated 40 and amongst those not reinstated were eight former trade union directors and workers who participated in the 1995 legal strike. Therefore, the measure was highly discriminatory given that, in essence, it affected the most active members of the organization, namely those who were dismissed for respecting a trade union agreement consisting in “work-to-rule”, without violating contractual or legal standards. Three of the five members of the trade union executive board left the company following legal proceedings (which lead to an agreement or out-of-court negotiations). Thirty?seven pilots affected filed a request to vacate the dismissals before the Fifth Labour Court of First Instance of Santiago;
   • – the dismissals reduced the negotiating power of the workers (participants decreased by 200 per cent compared with the previous collective bargaining process) and while the enterprise signed a new collective agreement, it also came to an agreement with three groups of pilots that had formed part of the trade union. The collective agreement with the trade union was for four years (48 months) with a 56 per cent reduction in the pay increase that otherwise would have been due, whereas the collective agreements with the groups of workers were for 62 months and a lower pay adjustment. Therefore, the pilots will not be able to bargain collectively at the same time and a strike will be very difficult to sustain in this context;
   • – it has been established that unionized pilots and technicians were subjected to intense pressure aimed at making them withdraw trade union membership. This is shown in documents and communications issued by the employer which offer improved conditions of work that are incompatible with continued trade union membership. This approach was also reflected in the explicit threats of dismissal that were made by some supervisors and acknowledged by some workers during conversations with the officer from the Labour Inspectorate. The trade union can legally file a complaint before the courts for these events and have the company fined;
   • – according to the inspections conducted within the enterprise, the latter excluded trade union members from flight training for operating new company aeroplanes;
   • – forty pilots dismissed for having participated in the “work-to-rule” action were reinstated with the condition that they write a letter in which they had to acknowledge responsibility for the possible damage the industrial action may have caused, as well as blame the trade union for forcing them into the alleged transgression. In their new individual contracts, these pilots did not regain the collective benefits that they had previously enjoyed;
   • – the administrative authority fined the enterprise on two occasions for failing to grant the work agreed upon in the employment contract or for failing to provide four trade union officials with their work schedules (to keep their licence, pilots must be accredited with a specific number of flight hours, and the inability to do so amounts, in practice, to professional disqualification).
2. 282. The Committee made the following recommendations [see 329th Report, para. 356]:
   • (a) The Committee decided to present an interim report on this case, considering that information was lacking. In particular, the Committee requests the Government to solicit information from the employers’ organizations concerned, with a view to having at its disposal their views, as well as those of the enterprise concerned, on the questions at issue. The Committee will then re-examine this case.
   • (b) The Committee emphasizes the seriousness of the allegations which have been confirmed by the Government, and expresses its deep concern in view of the number, and nature, of the anti-union practices that were discriminatory or contrary to collective bargaining and resulted in trade union membership dropping from 400 to 71.
   • (c) As regards the allegations relating to acts of anti-union discrimination (mass dismissals for conducting trade union activities, pressure exerted on pilots and their family members so that the former withdrew their trade union membership, the exclusion of trade union members from flight training for operating new aeroplanes, the failure to grant the work agreed upon in the employment contracts of trade union officials, the reinstatement of more than half of those dismissed under anti-union conditions), the Committee deeply deplores these anti-union practices and highlights the importance that the discriminatory practices suffered by the complainant organization and its members be rectified and sanctioned without delay.
   • (d) The Committee requests the Government to keep it informed of the result of legal proceedings that are currently in force or that will intervene by reason of the previously mentioned anti-union dismissals and practices, and expects that effective and dissuasive sanctions, along with compensatory measures, will be imposed without delay in order to put a stop to the enterprise’s anti union practices in the future. The Committee requests the Government to initiate discussions with a view to the possible reinstatement of the 37 pilots who have taken legal action against their dismissal.
   • (e) As regards the complainant’s allegations and the Government’s statement that the enterprise bargained with individual pilots or with groups of pilots for anti-union purposes, and in order to prevent pilots from bargaining collectively in a simultaneous manner in the future, the Committee requests the Government to take measures to prevent Lan Chile S.A. from bargaining for anti-union purposes with individual pilots or non-unionized groups of pilots, and to keep it informed of legal action that may be initiated with regard to such practices.

B. Information communicated by the Government from the Confederation of Production and Trade (February 2003)

1. 283. The Confederation of Production and Trade (CPC) states that the Government, unfairly, neither informed nor consulted Lan Chile S.A. with regard to the present complaint before the Committee on Freedom of Association. It was a cause for surprise that the Government, acting outside its legal powers, spoke unilaterally and arbitrarily of “anti?union practices” at Lan Chile S.A.; this is a serious infringement of the legislation as notice and decision on infringements through alleged unfair practices or anti-union practices are exclusively the domain of the labour courts (article 292 of the Labour Code). Moreover, the Labour Inspectorate is responsible for lodging complaints of such practices with the courts, but it did not do so and neither did the trade union; there is only one complaint lodged with the legal authorities relating to establishing whether the dismissal of certain workers was null and void based on the alleged anti-union practices. The CPC indicates, furthermore, that the Government has added other new facts to the complaint by the complainant organization.
2. 284. The CPC indicates, with regard to the complaint and the dismissal of pilots, that between 26 August and 5 September 2001 there was an average increase of operating flight time of planes of 22 hours (7.6 per cent more than the standard operating flight time).
3. 285. Flight delays caused disruptions in flight traffic control at the airport of Santiago de Chile (frequent changes in the planning of arrivals, alterations in approach sequences, integration of other users in holding patterns, etc.) and passengers missed connections, enduring long waits and, at times, flights were cancelled.
4. 286. Other deliberate actions were to fly at altitudes below those recommended in order to use more fuel. Moreover, the average of medical leave increased from 3.5-4 daily to 100 daily, which forced the company to cancel flights when replacement alternatives were not sufficient.
5. 287. The dismissals occurred for these reasons and to stop the damage that was wrongfully being caused and not because the process of collective bargaining was drawing near or because of the trade union membership of the pilots. In fact, following the dismissals, there was a trade union meeting during which it was agreed to suspend the actions undertaken in order to meet with the management of the company, achieving in the meetings with the latter complete agreement with regard to the collective bargaining under way, which was negotiated specifically with the same trade union officials who are the complainants in this case, culminating in the signing of a collective agreement with the trade union organization on 26 November 2001.
6. 288. The dismissals were a result of the “serious failure to fulfil the obligations imposed by the employment contract” (article 161.7 of the Labour Code) and, specifically, the behaviour of those dismissed was inconsistent with the technical standards of their duties and led to considerable damage to the company and its clients, both on the operational level, such as its commercial image (destroying the work of years) and on the economic level. They also seriously infringed the internal regulations of the company.
7. 289. Lan Chile S.A. was the number one company in the One World Alliance on international routes and number two for domestic routes. However, with the strategy promoted by a group of pilots (“go-slow”), the company was ranked last in the punctuality statistics for the period 26 August to 5 September 2001; the averages indicate a fall from 82.2 per cent to 39.3 per cent on domestic routes and from 82.1 per cent to 35.2 per cent on international routes. The measures used were a series of deliberate and concerted actions of unwarranted delays in flights, to the point which the General Directorate for Civil Aviation issued a resolution prohibiting unwarranted delays. These actions included a longer time to authorize closing the plane doors, longer “delays” on the tarmac both before departure and on arrival, the misuse of medical leave and flying at altitudes lower than usual, as well as other clearly obstructive actions. Once the dismissals had been declared by the company, the parameters of these issues returned to normal.
8. 290. Those dismissed, moreover, infringed the contractual obligations of the duties of fidelity and loyalty.
9. 291. Up to February 2003, one-third of the 42 workers (i.e. 12) who filed legal complaints against the enterprise for unfair dismissal renounced their complaints, having arrived at an agreement with the enterprise and ending the dispute that they had with it.
10. 292. Lan Chile S.A. totally rejects any “pressure” on pilots and technicians to withdraw their trade union membership; the Government has not specified what this pressure was, and it is completely and absolutely untrue. A large majority of the workers are members of trade unions without having problems as a result of this and the company maintains normal relationships with these trade unions. Company policy fully respects trade union and labour rights. It is also completely untrue that the company has pressured the families of the pilots so that they withdraw their trade union membership. However, many members of the pilots’ trade union believed that the “go-slow” was unnecessary and out of proportion, above all taking into account that it coincided with the tragic events of 11 September 2001, and they freely chose to withdraw their trade union membership from the pilots’ trade union without any interference from the company. There have been no complaints lodged with the courts with regard to the alleged pressures noted by the Government of Chile, in spite of the fact that the legislation envisages serious penalties when trade union membership is hindered.
11. 293. The Government’s statement that it noted that the company excluded pilots and co-pilots belonging to the complainant organization from flight training for operating the new company aeroplanes is completely untrue (documentation attesting that all pilots have received the regulation training and advanced courses is attached). For example, during the period stated, three trade union members obtained their promotion as pilots of the Airbus 320.
12. 294. It is not true that the dismissals reduced the negotiating power of the workers or that collective bargaining was fragmented and gave rise to lesser benefits than those previously obtained. On the contrary, in spite of the fact that the pilots were bargaining during the greatest commercial aviation crisis in history and in the context of the serious economic situation of a neighbouring country – Argentina (which had losses of US$57 million in the fourth trimester of 2001) – the pilots not only did not suffer a reduction in benefits and remuneration but an increase according to the change in the consumer price index was agreed on, as well as a real increase in wages equivalent to 2 per cent per year.
13. 295. According to the Government, three groups of workers, bargaining separately, signed collective agreements for 62 months, in circumstances in which the trade union did so for 48 months, for which reason, in future negotiations, there will be some pilots who will not be able to negotiate collectively through the regulated channels and at the same time, and who will not have a negotiating power that can act as an appropriate counterbalance. In the complaint and in the information provided by the Government of Chile, it states that the periods agreed by each one of the contracts and the collective agreements ensure that the pilots will not be able, in practice, to come together to bargain collectively in the regulated manner or at the same time, and that they will not be able to negotiate with their counterpart on an equal footing. This is incorrect.
14. 296. First, Lan Chile S.A. states that the various collective agreements and contracts were freely signed by the contracting parties, who acted in full autonomy. The representatives of the pilots and co-pilots established, together with the company, the duration of the various collective agreements that bound them, which not only ensure their current level of income for a prolonged period of time when the civil aviation market is very unstable but also increase it in real terms throughout the whole period. The duration agreed upon will clearly benefit the workers affected by these instruments and will impose quite a serious situation of inflexibility on the company, as it will not be able to try to reduce the cost of the wages covered by these instruments as they are protected by legal regulations that prevent individual bargaining for wages established in collective instruments.
15. 297. Second, it should be highlighted that the collective agreement signed by the company and the complainant organization dates from 26 November 2001, i.e. after the main collective labour agreements whose durations are being contested.
16. 298. In the case of Lan Chile S.A., pilots and co-pilots are always able to unite, when they consider it most convenient, and bargain collectively or separately, at the time of expiry of the last of the collective contracts or agreements, or before, if the company will accept such a procedure. However, there is no one absolute obstacle that makes it impossible for all workers employed as pilots or co-pilots of Lan Chile S.A. to associate in one single draft collective agreement should they wish to do so.
17. 299. While the Government’s information may imply, from its own particular point of view, that the periods agreed upon in the collective agreements and contracts are prejudicial to the pilots and co-pilots of Lan Chile S.A., the reality is that these employees themselves chose periods longer than those agreed upon, and in doing so believed that this would benefit them.
18. 300. With regard to the alleged publicity campaign undertaken by Lan Chile S.A. against the complainant organization, its officials and members, Lan Chile S.A. does not know of the existence of any type of publicity campaign against the trade union, its officials or members, which is referred to in the complaint submitted by the trade union, either in form or in substance. Similarly, Lan Chile S.A. categorically states that it has not financed, either directly or indirectly, notices, publications, press studies or other forms of publicity aimed at damaging or influencing the image of the company’s trade unions.
19. 301. Moreover, the pilots and co-pilots are the public image of the company for its clients and the highest authority in the company’s planes and the company has an interest in maintaining their prestige and repute, and there is no reflection in the media of any doubt in their professional capacity, which the company believes is of the highest standard and quality.
20. 302. Lan Chile S.A. indicated that it was proud of its pilots, their professional capacity and their dexterity, and it would be simply irrational to begin a campaign, from within the company, to undermine them, given that this would directly affect the company, which, as an aviation company, must, among other things, guarantee the appropriate competence of the pilots and co-pilots in the cockpits of its various planes.
21. 303. Logically, not all the press articles were pleasing to or supportive of the parties mentioned, but to proceed from there to maintain that the company organized and financed a campaign of this type is a very different state of affairs. Lan Chile S.A. quotes, with press cuttings, a series of statements by the secretary of the pilots’ trade union that are clearly critical of and prejudicial to the company and that are not based on fact. It is possible that many things were said that could have and should have been omitted by the parties in an atmosphere as tense as the “go-slow” protest, but it is neither fair nor true to maintain that there was “a campaign by Lan Chile S.A. to discredit the Trade Union of Pilots and Technicians of Lan Chile”.
22. 304. The Government’s report indicates that 40 of the pilots dismissed for disciplinary reasons were reinstated by the employer on the condition that they write a letter in which they acknowledged responsibility for the possible damage the industrial action may have caused, and blaming the trade union for forcing them into the alleged transgression. Moreover, it states that the pilots, in their new individual contracts, did not regain the collective benefits that they had previously enjoyed. With regard to this issue, the Lan Chile S.A. company finally reinstated 51 pilots at Lan Chile, Lan Cargo (formerly Ladeco) and Lan Express. The labour and remuneration benefits that these workers enjoy are identical in all cases to those pertaining to the rest of the pilot body at Lan Chile S.A., for which reason it is untrue that they have been discriminated against in this matter. The exception to the above is of four cases of pilots who were employed on a temporary basis with temporary contracts and various wage levels.
23. 305. With regard to the alleged written statement requested by the company, wherein the former employees were required, in order to be re-employed, “to acknowledge responsibility for the possible damage the industrial action may have caused, and blaming the trade union for forcing them into the alleged transgression” is not true.
24. 306. While many of the dismissed pilots and co-pilots requested the company in writing that they be reinstated, the tone and content of these letters was that believed relevant by each individual, and the company made no demands in this respect. It is difficult moreover to see how the demand to request reinstatement from the company in a letter might affect freedom of association and the rights of workers in any way, particularly when these letters have no effect other than to facilitate reinstatement with the company. Moreover, these letters were never made public.
25. 307. The report indicates that Lan Chile S.A. has made various threats of dismissal to pilots of the company. Lan Chile S.A. does not know of any of the alleged threats of dismissal to its workers that are referred to in the complaint from the trade union. It is not aware of the causes that may have given rise to them nor to whom specifically they were directed or who specifically threatened dismissal to a pilot of Lan Chile S.A. None of this information was supplied by the Government, which says that it confirms these threats. It should be pointed out that the complaint, illogically, states that the company at the same time is “in desperate need of pilots” and is making “an effort to ensure adequate staffing levels during the next period of heavy air traffic”.
26. 308. If, as the complainant organization states, the number of trade union members has gone from 400 to 71, it should be emphasized that the actions decided upon by the executive board of the trade union caused a deep sense of unease and concern among many members who believed that the trade union measures were unjustified and disproportionate, particularly in the context of the events of 11 September 2001. The company did not encourage members to withdraw their membership. Moreover, the fact that the executive board of the trade union went from five to three members is due to the trade union’s decision.
27. 309. In three cases, the officials themselves requested their disassociation from the company, indicating that their situation with the members was untenable and their representativeness was minimal, for which reasons they preferred to relinquish their trade union duties.
28. 310. With regard to the decrease in the membership of the trade union and a significant reduction in resources, in the form of trade union dues, the company has nothing to do with the resources of the trade union.

C. New information from the Government

1. 311. In its communication of 12 January 2004, the Government transmits the following information, provided by Lan Chile S.A.: 35 of the 42 workers who had filed proceedings against the dismissals of September 2001 have signed a direct agreement with the company whereby they withdrew unilaterally from their demands; the only cases remaining pending concern seven workers. The withdrawals (which the Government annexes to its communication) mention that “in its employer’s capacity, during all the working relationship binding the undersigned, Lan Chile maintained an appropriate conduct, showed respect and complied with labour standards …”.
2. 312. Referring to the anti-union practices allegedly committed by Lan Chile S.A., the Government adds that on 29 September 2003, a former member of the union filed charges of anti-union practices which are dealt with by the 5th Chamber of the Labour jurisdiction; the latter has requested information from the Metropolitan Regional Directorate of Labour and has concluded that this Directorate should be made a party to said proceedings, under article 292 of the Labour Code. At the hearing on 30 October 2003, the company raised the time limit provided for in article 480 of the Code of Civil Procedure, and argued that the court was already seized with the issue, in the context of the case relating to the dismissal of the pilots.
3. 313. Finally, as regards the collective bargaining conducted by Lan Chile S.A. with individual pilots or small groups of pilots, to impede bargaining with the whole group of workers, the Government indicates that the company has been firmly advised that the labour authorities would not permit anti-union actions and that the penalties provided for in the law for such actions would be applied.

D. The Committee’s conclusions

1. 314. In the present case the complainant organization mainly alleges a campaign organized by Lan Chile S.A. to break up its organization, which began in 2001 and took the form of a series of illegal practices of anti-union discrimination, above all in connection with negotiations aimed at concluding a new collective agreement. According to the complainant, these practices include a publicity campaign against the trade union; the mass dismissal of unionized pilots; threats of dismissal; pressure exerted on pilots and their family members so that the former withdrew trade union membership; discrimination against trade union members with regard to training; the re-employment of dismissed pilots under anti-union conditions (the acceptance of individual responsibility for the industrial action entitled “work-to-rule”; a written statement that the trade union ordered them to participate in this action; and acceptance to be covered by individual employment contracts rather than the collective agreement).
2. 315. The Committee notes the information provided by the Confederation of Production and Trade (CPC) wherein the Lan Chile S.A. company’s point of view is presented and the allegations of the complainant organization concerning a series of illegal labour practices violating trade union rights and the Government’s statements attributing Lan Chile S.A. with anti-union practices are rejected. According to the company, the complainant organization instituted a series of deliberate and concerted actions by the pilots prior to collective bargaining in order to harm the company; the information provided by the CPC points to a combination of “work-to-rule” and “go-slow” activities and deliberate delays to flights, a large number of medical leave certificates and measures to increase costs (flying at altitudes lower than those recommended), which caused economic damage, damage to the image of the company and adversely affected clients at the same time as it caused disturbances in air traffic control, according to the company. In order to put an end to this situation, the company proceeded with dismissals. According to the CPC, a new collective agreement was signed on 26 November 2001 and only 30 of the pilots who had been dismissed were continuing with proceedings against the company for their dismissal in September and October 2001. The Committee notes the contradiction between the points of view of Lan Chile S.A. and the Government with regard to the existence of anti-union practices, but observes that according to the Government, in September 2003, a former member of the union has filed charges of anti-union practices with the judicial authorities, which have decided that the Metropolitan Regional Directorate of Labour should be made a party to said proceedings. The Committee also notes the recent Government’s statement that 35 of the 42 workers who had filed proceedings against their dismissals have withdrawn their demands, have declared that the company had maintained throughout that period an appropriate conduct, in conformity with the law, and that there remain only seven pending cases.
3. 316. In the circumstances, the Committee requests the Government to inform it of the decision that is handed down with regard to the dismissal of the seven pilots and to keep it informed of the results of the judicial charges brought for anti-union practices by an ex-member of the union.
4. 317. Independently of the decision to be made by the courts on the alleged anti-union practices, the Committee emphasizes that in this case the initial number of dismissals extended to 108 pilots who were members of the trade union, even though, a little later, the company reinstated a large number of these and was reaching agreements with others, so that only seven cases of dismissal remain pending before the courts at present.
5. 318. Finally, the Committee notes that the Government indicates, in connection with the collective bargaining conducted by Lan Chile S.A. with individual pilots or small groups of pilots, to impede bargaining with the whole group of workers, that the company has been firmly advised that the labour authorities would not permit anti-union actions and that the penalties provided for in the law for such actions would be applied. The Committee recalls that measures should be taken to encourage and promote the full development and utilization of machinery for voluntary negotiation between employers or employers’ organizations and workers’ organizations, with a view to the regulation of terms and conditions of employment by means of collective agreements [see Digest of decisions and principles of the Freedom of Association Committee, 4th edition, 1996, para. 781].