Salary increases via collective bargaining will only reach unionized

Public sector workers will no longer have an impediment to collectively bargain for economic issues. This after the constitutional Court (TC) declare Law 31188 constitutional, referring to the state collective bargaining law.

In addition, this has been reinforced with the complementary provisions included in the 2022 public budget, that authorize salary improvements that occur within the framework of collective agreements or arbitration awards.

And it is that, although public workers could already bargain collectively, their demands did not have to be related to economic issues because Article 6 of the previous public budgets prohibited it. However, this issue has managed to be corrected for the 2022 budget.

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“The important thing is that once again the possibility is opened, not only to negotiate working conditions, but also economic conditions, respecting the budget balance that will be fundamental,” commented the labor lawyer Ricardo Herrera.

For his part, the sociologist and member of the Center for Public Policies and Human Rights (Peru Equity) Enrique Fernandez-Maldonado He expressed that great progress has been made towards the recognition of the fundamental rights that assist all workers, such as collective bargaining.

“There was no reason why public sector workers could not exercise this right as private sector workers do,” said the expert.

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Strengthen unionization

Another impact that the negotiation of salary improvements in the public sector could have is the strengthening of unionization, which has an affiliation rate of 15.9%, of the more than 1,600,000 state workers.

As Herrera explains, these negotiations take place through workers’ organizations (unions, federations) with public entities. However, if the specifications are approved, that is, a salary improvement is agreed, the scope of this benefit will depend on the union participation in the entity.

“If it is a majority union, half plus one of the workers in the bargaining area joins. Its agreement or arbitration award has general effectiveness and applies to unionized and non-unionized members, but if it is a minority, it applies only to its affiliates, ”says the worker.

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Given this, Herrera believes that the unionization rate could rise, especially in entities that have fewer members.

Fernández-Maldonado also agrees with this assessment, as he points out that being able to obtain a salary improvement encourages more workers to join a union. “The negotiation of economic issues is an incentive for unionization,” added the sociologist.

Meanwhile, the president of the Unitary Central of Workers of Peru (CUT), Julio César Bazán, said that now union members have an advantage, which would allow union membership to be strengthened in the public sector.

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In 2023 improvements would be reflected

Labor lawyer Ricardo Herrera explained that the unions must present their demands in the coming months so that they can be evaluated and, if approved, they can become effective in 2023.

“The claims documents that are presented in the summer should be concluding by 2023,” he said.

Likewise, the expert stated that these negotiations will be carried out taking into account the budget of each entity, This will allow the Public Treasury, which was the most worrying thing with this measure, not to be affected.

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The numbers

16.7% of state workers who have been unionized are men.

15.9% was the union membership rate in the public sector in 2018.

X-ray of union membership in the public sector