Employers and trade unions contest ownership of former trade unions’ assets

In September 2007, the Ministry of Labour, Family and Equal Opportunities issued a bill for public debate on the transfer of assets held by former trade unions until December 1989 to the National Union for the Takeover of the Trade Unions Estate, which has yet to be set up by the national trade union confederations. The employer organisations disputed the bill, arguing that the former trade unions’ wealth should be managed by a consortium of employer and trade union organisations.

Rationale of government bill

The current trade unions of Romania were re-established under Act 54/1991 (subsequently, Act 54/2003), which superseded the provisions of Act 52/1945 governing trade unions.

In September 2007, for the purpose of public debate, the government bill on the transfer of assets held by former trade unions until 22 December 1989 was published on the website of the Ministry of Labour, Family and Equal Opportunities (Ministerul Muncii, Familiei şi Egalităţii de Şanse, MMFES). In the preamble to the bill on the transfer of ownership of the trade unions’ assets, the initiator specifies that the two previous pieces of legislation, enacted in 1991 and 2003, did not settle the legal status of the real estates owned by the trade unions. At present, no conveyance documents exist attesting the transfer of ownership of such properties from the former trade unions, in existence prior to 1989, to the current trade union organisations: ‘This ownership uncertainty has discouraged potential investors from investing in these facilities, which, with the passage of yet more time, may cause tremendous and irreparable damage to this huge estate.’

While it is difficult – if not impossible – to trace back the primary sources from which the trade unions’ estate, as it stood in 1989, was gradually built, this new regulatory act proposes that the title to the estate be vested in the National Union for the Takeover of the Trade Unions Estate (Uniunea Naţională pentru Preluarea Patrimoniului Sindical, UNPPS). This trade union organisation is to be formed as a legally incorporated entity, with the consensual approval of the national trade union confederations.

The initiator of the bill maintains that the provisions of this new act are in compliance with the International Labour Organization (ILO) Convention 87/1948, regarding trade union freedom of association and the protection of union rights. This convention was ratified by Romania in 1958, and stipulates that workers’ organisations ‘may not be subject to dissolution or suspension by administrative procedures, nor may the title to or the use of trade union properties be changed the same way’.

Main provisions of bill

The current bill regulates the transfer procedure for the assets of the trade unions existing prior to the Revolution of December 1989 overthrowing communist rule in Romania. The bill sets out the following main provisions:

  • procedures for the establishment of UNPPS, which includes the obligation of the competent courts of law to review the representativeness criteria and conditions that national trade union confederations should meet;
  • procedures to determine ownership rights to real estate, or grant reparations;
  • institutional measures for the act to be enforced; for example, a commission is to be set up as a branch of the Ministry of Economy and Finance (Ministerul Economiei şi Finanţelor, MEF);
  • ownership changes, administrative or judicial procedures, responsibilities and penalties.

Employers’ reaction

After the publication of the bill, the Alliance of Employer Confederations in Romania (Alianţa Confederaţiilor Patronale din România, ACPR), an umbrella organisation representing seven employer organisations with national coverage (RO0705019I), issued comments on the bill that may be summarised as follows:

  • the legal concept of ownership transfer may not apply to trade union assets, because no legal continuation exists between the former communist trade unions and the current trade union organisations;
  • the takeover and management of the trade unions’ assets will be legitimate and welcome if carried out through a consortium of trade unions and nationally representative employer organisations.

Commentary

At present, the trade unions’ estate is being managed by SIND România, a business corporation with representatives of the national trade union confederations on its governing board.

During the past 18 years of the transition period to a free market economy, the trade unions’ wealth has depreciated considerably, due to the lack of financial resources to maintain the various properties of the estate such as hotels, medical establishments and sports facilities.

Although the dispute between the employer organisations and the trade unions – which runs deeper between both sides – is likely to continue, the settlement of the ownership status of these properties may be a first step towards the better management and capitalisation of the trade unions’ wealth.

Constantin Ciutacu, Institute of National Economy, Romanian Academy

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