US embassy cable - 05QUITO2129

UNCLAS SECTION 01 OF 02 QUITO 002129 
 
SIPDIS 
 
SENSITIVE 
 
DEPT FOR WHA/AND, WHA/PPC, EB, AND DRL/IL. USDOL FOR JORGE 
PEREZ-LOPEZ. GENEVA FOR JOHN CHAMBERLIN. PLEASE PASS USTR 
FOR A/USTR CLATANOFF, V. LOPEZ AND B. HARMON. 
 
E.O. 12958: N/A 
TAGS: ELAB, PGOV, EC, Labor 
SUBJECT: MINISTER OF LABOR WILL WORK TOWARDS LABOR REFORM 
 
1.  (SBU) Summary:  In a September 14 meeting, the Ambassador 
told Minister of Labor Galo Chiriboga that the FTA offered 
the best opportunity for labor rights protection in Ecuador. 
Chiriboga agreed that Ecuador needed a more modern labor code 
and the International Labor Organization (ILO) must be 
involved in any process of drafting the new code. 
Chiriboga's goals included strengthening unions, 
strengthening the tripartite National Labor Council, 
improving the MOL's inspections system, combating child 
labor, and increasing job opportunities for youth and women. 
We will support these goals, while continuing to press for 
needed labor code reform.  End Summary. 
 
New Labor Code 
-------------- 
 
2.  (SBU) At her introductory September 14 meeting with 
Minister of Labor Galo Chiriboga, the Ambassador told him 
that the FTA offered the best opportunity for Ecuador to 
achieve true labor reform and that it was important that 
reforms be passed before the FTA goes to the U.S. Congress. 
Chiriboga agreed that a more modern labor code was needed. 
The Ambassador asked if the ILO would be involved in the 
drafting of a new labor code and Chiriboga replied that they 
must be involved.  In July, the National Labor Council 
prepared a list of priority topics for discussion which 
included labor code reform.  Chiriboga said one of his 
priorities was strengthening the National Labor Council as a 
space for dialogue between union and business leaders. 
 
Strengthening Unions 
-------------------- 
 
3.  (SBU) Chiriboga, a labor rights lawyer by training, said 
that there was a general negative perception and 
"demonization" of unions in Ecuador.  He said some unions, 
particularly the public health workers and teachers unions, 
added to a negative perception with their frequent disruptive 
strikes that affected the well-being of a large number of 
citizens.  Chiriboga said both unions and employer 
organizations needed to be strengthened in order to allow 
them to be effective actors in society.  Currently, union 
membership was very low, he said, because many workers were 
fired after attempting to form a company union.  One of the 
best ways to strengthen unions, according to Chiriboga, would 
be by permitting industry-wide unions.  Chiriboga said the 30 
employee minimum to form a union should be lowered to 
facilitate unionization.  He also asked for USG help in 
setting up a program for U.S. union leaders to visit Ecuador 
to help strengthen Ecuadorian unions. 
 
Subcontracting Law in Congress 
------------------------------ 
 
4.  (SBU) Chiriboga spoke of the increased use of outsourcing 
as a problem for Ecuadorian workers.  He said he believed the 
subcontracting bill currently pending in Congress would be 
passed by this December.  The law would replace the 
presidential decree passed in October 2004.  He will ask for 
the opportunity to address Congress during the second debate 
of the proposed subcontracting law.  He added that the MOL 
was conducting a study on subcontracting that would be 
released at the end of September.  The study found that there 
were 4,500 subcontracting companies in the country. 
 
Combating Child Labor 
--------------------- 
 
5.  (SBU) The Ambassador said that the USG and the MOL share 
a common goal of eliminating the worst forms of child labor. 
She said the U.S. Department of Labor would soon announce a 
$4 million program to combat the worst forms of child labor 
in indigenous communities.  Chiriboga said the MOL is working 
with an inter-agency group including the Ministries of 
Health, Social Welfare, and Economy to cooperate on the 
issue.  For example, the Ministry of Education would help 
provide scholarships for children removed from work and would 
have the $25 school registration fee waived for them.  The 
Ministry of Labor would contribute with an employment plan 
for parents of child laborers.  Chiriboga said business 
leaders had recently pointed out to him the need to also 
focus on eliminating child labor in cities.  He said he would 
be coordinating with the Quito municipality on a program to 
help get children off the street. 
 
Improving MOL Inspections 
------------------------- 
 
6.  (SBU) Chiriboga lamented that the MOL's budget is 
currently only 0.08% of the government's national budget and 
limits the MOL's ability to be effective.  Chiriboga wants to 
strengthen the MOL's inspection system which he feels 
currently does not fully comply with Ecuador's ILO 
commitments.  (Note:  It also does not conform with 
Ecuadorian law.)  He said he looked forward to bilateral 
assistance in this area. 
 
Increasing Opportunities for Youth and Women 
-------------------------------------------- 
 
7.  (SBU) One of Chiriboga's priorities was increasing 
opportunities and training for women and youth, who often 
suffered most during periods of high unemployment.  He said 
he was working with the ILO on a program that would allow for 
the training of 15,000 young people in Ecuador next year. 
 
Comment 
------- 
 
8.  (SBU) Chiriboga appears sincerely committed to improving 
worker rights in Ecuador and he clearly understands the need 
for a new, modern labor code.  Any reform will be difficult 
to carry out quickly and a challenge to get passed by 
Ecuador's fractious Congress.  Perhaps recognizing the 
challenge of getting business and labor leaders to compromise 
and agree to act, he evinced little sense that reform would 
be quick or easy. 
JEWELL