The road towards stronger social dialogue in Nicaragua

23 Apr 2015

Garment industries tend to be the first sectors in many developing countries to have formal employment – meaning that they often act as the starting point for countries’ labour rights including trade unions. Nicaragua is no exception.

23 April 2015.

Managua – “Ten years ago, it was almost impossible to have a trade union in the apparel industry in Nicaragua. This has changed for the better,” says Alvaro Murillo, the Industrial Relations focal point for Better Work Nicaragua. In his role, he works with trade unions and factories to promote understanding of issues such as the need for real social dialogue.

“The apparel industry is fairly recent in Nicaragua, and in the past, there was a lot of tension and conflict between unions and employers. They did not trust each other,” says Alvaro. This changed in 2007, when employers, trade unions and the government came together and signed the first of three subsequent Tripartite Agreements.

In addition to agreeing on annual minimum wage increases for workers in the Free Trade Zone – the majority of whom work in textile and apparel factories – the parties to the agreements committed to seeking solutions to other work-related issues, such as occupational safety and health, education, affordable housing, subsidized food baskets, among others.

The agreements – signed in 2007, 2010 and 2012, have afforded businesses stability in their projections of labour costs, and workers the stability to anticipate their earnings, reducing much of the tension surrounding wages. The agreement is the result of trade unions, employers and government coming together to bring stability to the sector.

Recent years have brought major changes to the industrial relations climate in Nicaragua’s garment industry. Out of 28 Better Work factories, 19 have at least one trade union, with some having two or more. Better Work is helping to ensure that dialogue also takes place in these individual factories, with union leaders and middle management working together to resolve workplace issues, particularly in cases where there are multiple factory-based unions.

Alvaro says that in order to help employers and workers work well with one another, there must be a real dialogue process and breaking down of mistrust: “In general, employers may know about industrial relations but be reluctant. When there is a lack of commitment from employers to work well with unions, it is a big challenge,” says Alvaro. “Often for employers signing a Collective Bargaining Agreement (CBA) is not a problem, but compliance with it is a real issue”.

Better Work’s strategy within factories involves creating Performance Improvement Consultative Committees (PICCs). These are joint worker-management committees set up to address the interval managers and workers need to discuss concerns on either side and create and implement an improvement plan. The PICCs have been proven to be effective in enabling understanding between both sides, resolving conflicts and creating shared responsibilities.

Better Work has also focused on building the ability of unions to be more effective and to work productively with employers. This has brought progress in areas such as the labelling of chemicals and the clarification of incentives policies. “Trade unions feel that the factories who work with Better Work are making great progress and there are good examples of these factories giving workers a greater say in improving conditions,” says Alvaro. He cites the example of factories where workers have played a proactive role in improving and monitoring better conditions in bathrooms, and ensuring that aisles are free of obstructions. In one factory, Alvaro describes, management and union representatives on the PICC developed checklists to jointly monitor both these issues.

Alvaro is enthusiastic about progress and estimates that most employers are now willing to work effectively with unions. “It’s about workers being able to exercise their rights, including freedom of association, and to work together to bring benefits to both sides. If we can reach a state where employers see unions as a way to effectively involve workers, then that’s an even greater success,” he adds.

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