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BAUEN, day 75

After reviewing some facts relative to the history of the hotel as of the bankruptcy (without even mentioning the prior circumstances) and grounding herself in the passage of Law 1914 (the “Morando Law”), Hualde went on to explain that in her “visual inspection” of May 17, 2006, she could see that:

(…) the poor state of preservation of some sectors of the building could result in risk to the health and life of the members of the cooperative and other employees, of the hotel guests, and of other citizens that could circumstantially be found in the place for purposes of use of the same as a restaurant, festival hall, conference center, theater, and bar.1

While the court never did a “visual inspection” in the first few months of 2003, for example, or even in the last months of 2001, so as to be able to compare the state of the hotel and the advances achieved by worker management, Hualde based her ruling on the Cromagnon case to use the lack of safety as a motive for the eviction. The concern, then, is the health of the cooperative members, but not other, more everyday circumstances that encompass health, like a dignified income to live on, guaranteed by work,which is just what the workers were achieving. She also slipped in a passing mention of suspected labor fraud by saying “the members of the cooperative and other employees.” It is well-known that, under Argentine legislation, worker co-ops cannot have employees, only associates who work (because that is the objective of this cooperative form), which is why hiring employees from outside the cooperative constitutes labor fraud,2 which obviously was not the case at the BAUEN, where all the workers were always associates. The judge pointed out that she sent the result of that inspection to a multitude of public agencies that should have taken up the topic, with no results.

  1. 1.a Inst. Com. n.° 9, Sec. n.° 18, “Solari S.A. s/ quiebra (indirecta)”, 69.699, 20 de julio de 2007, ruling.
  2. Labor fraud in worker cooperatives is used for outsourcing and labor precariousness, even by big businesses, forcing the workers to appear as members of a false cooperative instead of hiring them in an employee relationship. This frees the employer from paying social expenses, and strips the workers of labor rights, pension payments for work done, seniority, and union affiliation. To fire them, they are forced to leave the cooperative, or the contractual relationship between the cooperative and the business is cut directly, avoiding the cost of severance pay to the workers. Of course, this is not the case in recovered businesses, in spite of various trials in which former members try to demonstrate that they were employed by the cooperative. In general, those cases are dismissed in favor of the recovered businesses.

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