Effectiveness of the Collective Bargaining Agreement
Attorney Felipe Torres Cobo
1. Background
Through Judgment No. 002-16-SEP-CC, in Case No. 2209-11-EP, dated January 6, 2017, published in Official Register Supplement No. 712 of March 15, 2016, the Constitutional Court accepted the Extraordinary Protection Action filed by Julio Vega Vaca against the judgment issued on November 15, 2011, at 08:00, by the judges of the First Labor Chamber of the National Court of Justice, which rejected the cassation appeal filed by the procedural parties within a labor proceeding.
The Extraordinary Protection Action was accepted because the constitutional rights to legal certainty and due process, specifically the guarantee of reasoning, had been violated.
2. Origin of the Extraordinary Protection Action
Julio Vega Vaca, a former employee of the mixed-economy water, sewage, and sanitation company of Machala, TRIPLEORO C.E.M. — TRIPLEORO — filed a claim for payment of compensation for alleged unfair dismissal by the company.
The claim was accepted at first instance by the Second Occasional Labor Judge of El Oro on May 7, 2008, ordering payment for labor compensation and retirement benefits.
The defendant entity appealed, and the Specialized Civil, Commercial, Tenancy, Residual Matters, Labor, Childhood, and Adolescence Chamber of the Provincial Court of Justice of El Oro, in its judgment of February 6, 2009, upheld the first-instance ruling.
The claimant filed a cassation appeal, which was heard by the judges of the First Specialized Labor Chamber of the National Court of Justice. Through a decision dated November 15, 2011, the judges did not overturn the judgment.
3. Claimant’s Arguments
The claimant stated that he had worked for more than 25 years for the Municipal Drinking Water Company of the Municipality of Machala and that, on January 6, 2004, the Cantonal Council of Machala, through a municipal ordinance, dissolved that company, giving rise to a new mixed-economy company, TRIPLEORO, in which the Municipality of Machala held 30% of the shares and TRIPLEORO held the remaining 70%.
He stated that Articles 7, 8, 9, and 10 of that ordinance provide that the successor company must guarantee the rights and job stability of the workers who signed the third collective bargaining agreement on September 7, 2002, which remained in force throughout the employment relationship.
He argued that, pursuant to Article 1561 of the Civil Code and Articles 40 and 246 of the Labor Code, the contract is law for the parties.
He stated that, since the judgment of the trial judge dated May 7, 2008, legal and constitutional rules had been violated, including due process, labor rights, and labor guarantees.
He also stated that TRIPLEORO filed an action of unconstitutionality against Articles 7, 8, 9, and 10 of the aforementioned ordinance, alleging the illegitimacy of that contract.
The Constitutional Tribunal, through Resolution No. 0034 of May 16, 2005, dismissed that claim, stating that the workers’ rights established in that collective bargaining agreement are inalienable and intangible, granting full validity and legal effect to the third collective bargaining agreement.
Finally, he stated that the constitutional case law issued by the Constitutional Court in a similar case had been disregarded.
4. Collective Bargaining Agreement
The cassation appeal did not rule on whether the third collective bargaining agreement was legitimate, despite having ruled in another similar case, by order of the Constitutional Court, that the third collective bargaining agreement was fully valid.
This violated constitutional case law, due process, the right to justice, the right to defense, legal certainty, and effective judicial protection, contrary to Articles 75, 76, and 82 of the Constitution of the Republic.
5. The National Court of Justice in Relation to Constitutional Court Judgments
The challenged judgment was issued after the judgments of the transitional Constitutional Court regarding the extraordinary protection actions filed by both TRIPLEORO C.E.M. and several claimants in the labor proceeding, against the judgments issued by the judges of the Specialized Labor Chamber of the National Court of Justice — Judgments Nos. 044-10-SEP-CC, 062-10-SEP-CC, 063-10-SEP-CC, 065-10-SEP-CC, 066-10-SEP-CC, and 067-10-SEP-CC.
The Constitutional Court stated that these judgments “provide legal certainty in the issuance of subsequent judicial decisions.”
Therefore, when the case under review failed to rule on the violation of the claimant’s rights resulting from the failure to recognize the existence of the collective bargaining agreement, legal certainty was violated, since this was an issue already resolved in cases that constitute binding judicial precedent.
6. Binding Precedent on the Effectiveness of the Collective Bargaining Agreement
The Constitutional Court stated that subsequent decisions must necessarily be consistent with binding judicial precedent.
In the present case, the Constitutional Court had ruled on the constitutionality of Article 7 of the Municipal Ordinance of Machala because “this provision guarantees workers the maintenance of their labor rights and guarantees, as provided in numeral 3 of Article 35 of the Constitution.”
In addition, the Court stated that contracts entered into under the relevant legal framework are law for the parties, “therefore, if through action or omission they are breached, there would be a violation of a constitutional right, which is precisely what occurred when the provisions of the collective bargaining agreement were not observed, despite its existence being justified and constitutionally guaranteed.”
Accordingly, the claimant’s rights are inalienable and should have been resolved in the cassation appeal.
7. Reasoning
The Constitutional Court analyzed the reasoning test.
It stated that, in the challenged judgment, the national judges merely referred to the analysis of the appellate court without mentioning any rule concerning the matters submitted for their review, namely, the payment of job stability compensation established in the collective bargaining agreement and the legitimacy of the third collective bargaining agreement.
This occurred despite the fact that the Court had ruled on a similar case before. Therefore, the decision lacked reasonableness.
8. Importance of Judicial Precedents
The Constitutional Court stated that, pursuant to Article 191, numeral 2, literal c, of the Organic Law on Jurisdictional Guarantees and Constitutional Control; Article 26 of the Rules for the Processing of Cases within the Jurisdiction of the Constitutional Court; and section 19.2.1 of the “Protocol for the Preparation of Binding Constitutional Precedents,” the Court’s aforementioned judicial criteria are mandatory for future cases that share objective identity with the facts and claims established in this unifying constitutional precedent.
9. Decision
The Constitutional Court declared the violation of the constitutional rights to legal certainty and due process, specifically the guarantee of reasoning.
It accepted the Extraordinary Protection Action and, as comprehensive reparation, ordered the following:
To annul the challenged judgment issued on November 15, 2011, at 08:00, by the judges of the First Labor Chamber of the National Court of Justice.
To return the proceeding to the moment at which the violation of constitutional rights occurred — the cassation judgment.
To return the case file to the Labor Chamber of the National Court of Justice so that the new judges selected from that Chamber may decide the case, considering the reasoning set forth in this judgment, as well as the binding judicial precedent contained in Judgment No. 001-12-PJO-CC, issued in Case No. 0893-09-EP and consolidated cases.