Labor Inspection Law

This Law applies throughout the national territory and has as its purpose to regulate the Integrated System of Labor Inspection and Social Security; to promote, monitor, and guarantee that employers and workers comply with and respect all legal provisions relating to labor, social protection, labor standards, safety and health at work, and those relating to social security; and to establish liability in case of infraction, non-compliance, or violation of constitutional and conventional rights and guarantees, and norms related to the aforementioned matters in work centers. Its application corresponds to the Secretariat of State in the Offices of Labor and Social Security (STSS), as the administrative authority within its competence, through the General Directorate of Labor Inspection (DGIT).

For the purposes of this Law, the following Definitions are established:

• 1)

  Labor Authority: The organs of the Secretariat of State in the Offices of Labor and Social Security, with faculties to monitor and guarantee compliance with and respect for labor legislation, safety and health at work, and to apply sanctions in cases that warrant it.

• 2)

  Work Center: Any place, whatever its designation, where production activities are carried out, distribution of goods or provision of services, or where persons subject to an employment relationship work, in the terms regulated by the Labor Code, labor laws, and Social Protection norms.

• 3)

  Labor Inspection: An act of public service by the competent Labor Authority, through which promotion and monitoring of compliance with and respect for labor legislation, safety and health at work are carried out, administrative liabilities are exacted, and workers and employers are assisted and advised in compliance with the manner in which labor norms under its competence must be applied. Its development is carried out in-person at the Work Center, through public servants authorized and qualified for such purposes, or through the use of information technologies, documentary requirements, and similar means.

• 4)

  Labor Inspector: A public servant appointed by the Labor Authority to conduct visits or inspections at Work Centers in accordance with the procedures established in the Law. For all purposes, the Labor Inspector is a public official of faith.

• 5)

  Secretariat: The Secretariat of State in the Offices of Labor and Social Security.

• 6)

  Safety and Health at Work: All aspects related to the prevention of work accidents and occupational diseases.

• 7)

  Mechanisms for promoting compliance: The schemes that Labor Authorities make available to employers to inform or certify compliance with labor regulations. Such mechanisms do not substitute the inspection work of the General Directorate of Labor Inspection.

• 8)

  Labor compliance certification: A document issued by the General Directorate of Labor Inspection, certifying compliance with labor regulations by an employer, derived from compliance promotion mechanisms.

• 9)

  Safety and Health at Work Standards: Those related to the matter of Safety and Health at Work, issued by competent authority in the terms established and international conventions on the matter, ratified by the State of Honduras.

• 10)

  Imminent Danger or Risk: That which has a high probability of materializing in the immediate or long-term future and poses a threat to the safety and health or loss of life of workers, or causes serious damage to the Work Center, generated by the direct correlation of high hazard caused by a physical, chemical, biological agent, physical condition, or by negligence of one or more workers that expose the company's personnel to the risk that is sought to be avoided.

• 11)

  Industrial hygiene: The branch of occupational health that is concerned with preventing Occupational Diseases, through the identification, evaluation, and control of work risks that may endanger the health and well-being of workers.

• 12)

  Industrial safety: A discipline concerned with the management or handling of risks inherent to operations and procedures in industry and even commercial activities and other environments.

• 13)

  Conditions of professional risk: Any characteristic of the same that could have a significant influence in the generation of risks for the safety and health of the worker. The following are specifically included in this definition:

  • a)

    The general characteristics of the premises, installations, equipment, products, and other items existing in the work center;

  • b)

    The nature of the physical, chemical, and biological agents present in the work environment and their corresponding intensities, concentrations, or levels of presence;

  • c)

    The procedures for the use of the aforementioned agents that would influence the generation of the mentioned risks; and, d) All other characteristics of work, including those relating to its organization and arrangement, that would influence the magnitude of the risks to which the worker is exposed.

• 14)

  Personal Protective Equipment: Any equipment, according to the work performed, intended to be carried or held by the worker to protect them from one or more risks that may threaten their safety or health at work, as well as any complement or accessory intended for that purpose.

• 15)

  Inspection Programs: Documents that describe actions aimed at planning, organizing, and controlling the promotion, application, monitoring, and compliance with labor legislation based on the human, budgetary, and material resources available to the Labor Authority. It includes, among other elements, the governing criteria, as well as timeframes and targets.

For the purposes of this law, the general principles of the Labor Inspection System are the following:

• 1)

  Legality: Full submission to the Constitution of the Republic, international labor norms ratified by Honduras, the Labor Code, laws, regulations, and other applicable norms related to the matter.

• 2)

  Protective Principle: Indubio Pro Operario, more favorable norm and more beneficial condition to the Worker.

• 3)

  Gratuity: In Labor Law it means that all matters processed in relation to the application of the Labor Code, its Regulations, Constitution of the Republic, International Conventions, and other Social Protection provisions are exempt from any payment such as the use of stamped paper and stamps, issuance of certifications, certificates, and other similar items.

• 4)

  Impartiality: No direct or indirect interest, personal or of third parties, should intervene that could prejudice any of the parties involved in the conflict or inspection activity.

• 5)

  Equity: Equal treatment is granted to the parties, without granting any of them any privilege, applying the established norms with equity, without prejudice to the protective nature of Labor Law.

• 6)

  Technical and functional autonomy: Independence is guaranteed to labor inspectors in the exercise of their competence against any unwanted influence.

• 7)

  Honesty: Honoring the inspection function and refraining from incurring in acts that are for personal benefit or that of third parties violating the Law.

• 8)

  Integrity and Ethics: Officials of the inspection system respect the normative provisions that regulate the inspection function and strictly adhere to the facts found during inspection activities.

• 9)

  Unity of Function and Action: Labor inspectors are properly trained to develop all the functions entrusted to them in labor, safety and health at work matters, without prejudice to specialization in certain areas under an integration and multipurpose scheme.

• 10)

  Responsibility: The responsibility of labor inspectors in the fulfillment of their obligations or care in doing or deciding something in the performance of their actions.

• 11)

  Hierarchy: Subjection to the instructions and established technical interpretation criteria established by the service of the General Directorate of Labor Inspection (DGIT) for the development of the inspection function.

• 12)

  Celerity: Inspection proceedings must be conducted with speed, avoiding unnecessary procedures or delay that would prejudice their development.

• 13)

  Efficiency and Effectiveness: The priorities established on the basis of appropriate criteria to maximize the impact of inspection actions.

• 14)

  Universality: The inspection activity covers the entire territory of the country and the various economic activities, including new forms of work organization.

• 15)

  Transparency: Information must be provided to employers, workers, and other social actors regarding their rights and obligations, what is expected of them under the mandate of the law, and what they can expect from the services of the General Directorate of Labor Inspection (DGIT).

• 16)

  Professional confidentiality: Inspection personnel must refrain from disclosing, even after having left the service, information, procedures, books, documentation, data, or background known on occasion of activities, as well as trade secrets, manufacturing or production methods that may be known in the performance of their functions.

The Simplified National Registry System of Employers (SRNSP) is created, which is under the responsibility of the Secretariat of State in the Offices of Labor and Social Security through the General Directorate of Labor Inspection (DGIT), in which all natural or legal persons, whether private or public law, or without profit motive, that carry out industrial, commercial, service, economic, or social activities, owners of works or industrial operations, and those performing work for the benefit of others, whether intermediaries, contractors, and private employment agencies, and as a consequence of those activities employ persons in any of the modalities contained in labor legislation and who employ persons in any of the forms contained in the Law on the matter, must be registered. The Labor Authorities within the scope of their respective jurisdictions must promote compliance with the obligation to register Employers and/or Work Centers and carry out among themselves exchange of information in order to plan, execute, and supervise coordinated maneuvers and Inspection Programs to the Work Centers that correspond to them. For the purposes of the application of this Article, the Secretariat of State in the Offices of Labor and Social Security must also be supported by public and private institutions that contain this type of registry, with which it must develop the respective information exchange agreements, which must be limited to what is permitted by Law.

The General Directorate of Labor Inspection (DGIT) is created as an organ dependent on the Secretariat of State in the Offices of Labor and Social Security, responsible for coordinating the Integrated System of Labor Inspection and Social Security (SRNSP), whose purpose is to monitor compliance with labor regulations, including those relating to labor relations, social security, and conditions of health and safety at work; establishing in its case the corresponding liabilities in case of infraction or non-compliance in work centers. In addition to ensuring compliance with guarantees and rights established in the legal system, the General Directorate of Labor Inspection (DGIT) must fulfill functions of information and advisory services through its inspection visits and technical advisory inspections to promote and facilitate compliance with the respective duties and obligations.

In its actions, the General Directorate of Labor Inspection (DGIT) must comply with the principles of celerity, transparency, quality of service, consistency, proportionality, and other applicable principles contained in this Law and labor legislation, making available to the entire population updated and easily accessible information.

The General Directorate of Labor Inspection (DGIT) is composed of at least: A General Director, a Deputy Director, Assistants to the General Director, an Administrative Secretary, Regional and local Heads of Inspection, regional legal auxiliaries, a Body of Labor Inspectors with competencies in labor relations, prevention of labor risks, and social security, a Body of Technical Collaborators and/or Inspection Experts with knowledge in the matter concerned. Their entry into service is conditioned on meeting minimum requirements of professional training, experience, functions, and profiles determined for each position in the Regulation of this Law, in addition to what is established in the Civil Service Law and its Regulation.

The Technical Audit of Inspection is created, which is attached to the Office of the State Secretary of Labor and Social Security and enjoys technical independence, objectivity, and impartiality. Its organization and functions must be regulated in the Regulation of this Law.

It corresponds to the Secretariat of State in the Offices of Labor and Social Security to determine the organizational structure of the General Directorate of Labor Inspection (DGIT), which must be adjusted to the characteristics of each region.

The employment and public service relationship of public servants of the General Directorate of Labor Inspection (DGIT) is subject to the Civil Service Law and its Regulation, with the exception of the General Director and Deputy General Director of Labor Inspection, where applicable.

The attributions of the General Directorate of Labor Inspection are the following:

• 1)

  To monitor compliance with the Labor Code and international conventions ratified by the State of Honduras in labor matters, this Law and its regulations, legal provisions relating to social protection, collective contracts, and other mandatory provisions, which includes:

  • a)

    Inspection of work centers;

  • b)

    Special inspection of family work, home-based work, and industries;

  • c)

    To study inspection reports to propose appropriate measures;

  • d)

    To verify whether previously found deficiencies have been remedied; and, e) To prepare reports with the results of inspections, proposing measures that are necessary for the general protection of workers.

• 2)

  To assist other offices of the Secretariat, conducting, through its inspectors, the proceedings entrusted to it;

• 3)

  To intervene conciliatorily in labor-management conflicts during the act of inspection in accordance with the Law;

• 4)

  To monitor the integration and functioning of Hygiene and Safety commissions; and,

• 5)

  To cooperate in the review of collective contracts, investigating the effect, the living conditions of workers, and the economic situation of enterprises.

Labor Inspectors, in addition to those contained in this Law, the Labor Code, and other legal provisions, have the following obligations:

• 1)

  To act with legality, honesty, loyalty, impartiality, efficiency, and confidentiality.

• 2)

  To monitor and promote, within the scope of their respective jurisdictions, compliance with labor legislation;

• 3)

  To punctually comply with instructions received from their hierarchical superiors in relation to the exercise of their functions, as well as to align their actions with normative provisions, guidelines, protocols, criteria, or scope of Inspection Programs;

• 4)

  To draw up reports in which the result of the Inspections carried out or those in which the facts that prevented them are recorded are noted, when the cause is the refusal of the employer or their representative, as well as to submit the reports in which the circumstances that prevented the practice of an Inspection are noted due to causes beyond the will of the employer or their representative or other causes. The reports must contain the requirements indicated by this Law;

• 5)

  To deliver to their immediate superiors, within a period of three (3) business days, counted from the day following the date on which the Inspection was concluded, the reports that they have drawn up and the corresponding documentation, except for cases of exception provided for in this Law in the Regulation;

• 6)

  To perform notification and service of process procedures related to the practice of Inspections;

• 7)

  To verify the existence and persistence of a strike or in its absence untimely work suspension in Work Centers;

• 8)

  To monitor that private employment agencies have the authorization and corresponding registry, granted in the terms that arise from the current legal system;

• 9)

  To order the adoption of Safety and Health at Work measures when, derived from visits to Work Centers and prior opinion of experts qualified in the matter, they identify unsafe acts or conditions; and,

• 10)

  To establish, after prior consultation and authorization from the General Directorate of Labor Inspection (DGIT), measures restricting access to risk areas or limiting the operation of activities, when this implies an imminent danger or risk, in accordance with what is established in Chapter IV of Preventive and Corrective Measures of Occupational Safety of this Law.

Labor Inspectors, in addition to those contained in this Law, the Labor Code, and other legal provisions, have the following faculties:

• 1)

  To review accounting books, wage books, payrolls, proof of payment and any other documents that effectively help them perform their duties;

• 2)

  To examine the hygienic conditions of work places and the personal safety conditions that they offer to workers, and particularly, they must ensure that all provisions in force on prevention of work accidents and occupational diseases are complied with;

• 3)

  Inspectors must take special care that all precepts whose compliance guarantees good relations between employers and workers are respected;

• 4)

  To monitor that the prohibition on night work for minors is complied with, bringing to the attention of the appropriate authority the failures they note so that they are sanctioned; and,

• 5)

  Those others established by other applicable legal provisions.

Labor Inspectors in the performance of their functions are obligated to monitor that:

• 1)

  Workers who so require, in accordance with the Law and its regulations, enter into contracts with the corresponding Work Signatories and are provided a copy of the contract or other documents from their personal file, issued in accordance with applicable legal provisions;

• 2)

  In each Work Center the commissions ordered by the Law and its regulations must be integrated, as well as their proper functioning;

• 3)

  Employers comply with current labor provisions;

• 4)

  Employers make the modifications ordered by the Labor Authorities, through circulars, memoranda, specific provisions on risk zones, in order to adapt their establishments, installations, machinery, and equipment to what is provided in the Law, its regulations, and Safety and Health at Work Standards;

• 5)

  Employers comply with provisions corresponding to work of minors, pregnant women, and those in nursing periods;

• 6)

  Employers must comply with the principle of elimination of discrimination in employment and occupation;

• 7)

  Employers and workers must comply with the obligations and prohibitions imposed on them by the Labor Code and the Internal Regulation of each enterprise;

• 8)

  To carry out inspections on its own initiative or at the request of a party; and,

• 9)

  Those others established by the Law, its regulations, and Safety and Health at Work Standards.

In the exercise of their functions, Labor Inspectors are authorized to:

• 1)

  Freely enter any work center, establishment, or place subject to inspection at any hour of the day or night, provided that work is being conducted at the Work Center, and may remain therein for the fulfillment of their functions. When conducting an inspection visit, they must communicate their presence to the inspected party or their representative, as well as to the worker, representative of the workers, or labor organization, unless they consider that such communication may impair the effectiveness of their functions, but in all cases they must identify themselves with the credential issued for that purpose;

• 2)

  To be accompanied on inspection visits by workers, their representatives or legal representatives of the parties, by management or union delegates in case such organizations exist in the enterprise, by experts and technicians that according to the case are required, or by those officially designated for the better development of the inspection function. The Secretariat of State in the Offices of Labor and Social Security, the Municipalities, and the relevant organs of the Public Administration must guarantee the collaboration of experts and technicians duly qualified for the proper exercise of inspection functions;

• 3)

  To conduct any investigation, examination, or test it considers necessary to verify that legal provisions are correctly observed, and in particular to:

  • a)

    Request documentary, testimonial, or any other type of information only or before witnesses from the inspected party or from the employer's personnel, on any matter relating to the application of the supposedly infringed legal provisions, as well as to demand the identification or reason for the presence of persons involved in the investigated matter;

  • b)

    Inspectors in the exercise of their functions must interview workers alone, without the presence of employers or their representatives, informing them that their statements are confidential, without prejudice to the Right of Defense that belongs to those who are prejudiced, in case it is representatives of the enterprise who are interviewed. Workers may also be interviewed outside the Work Center and even on non-business days and hours;

  • c)

    To formally request the presence of the employer or their representatives, workers or their representatives, and any subjects included in their scope of action, at the inspected Work Center or at the public office designated by the Acting Inspector;

  • d)

    To examine at the Work Center the company's documentation and books with relevance to verification of compliance with labor regulations, related to the investigated matter, such as: books, registries, computer programs, and files in electronic format, official declarations and accounting, social security documents; payrolls and pay vouchers; documents required under labor risk prevention regulations, and any others related to matters subject to inspection. To obtain copies and extracts of documents for attachment to the administrative file, as well as to require the presentation of said documentation at the public office designated by the Acting Inspector, with the exception of those documents whose exhibition is not obligated by the company in accordance with what is provided by the Commercial Code and the Law of Transparency and Access to Public Information. Consequently, all documentation unrelated to compliance with labor regulations is excluded from the requested information; and, e) To take or obtain samples with the assistance of qualified personnel, of substances and materials used or handled in the establishment, conduct measurements, obtain photographs, videos, image recordings, and prepare sketches and plans solely of the area where the infraction of the supposedly infringed Safety and Occupational Health Standards is reported, guaranteeing the confidentiality and secrecy of information that is the exclusive property of the employer, provided that the inspected party or their representative is notified.

• 4)

  To gather and obtain information, data, or background with relevance to the inspection function;

• 5)

  To request in case of obstruction to inspection work, the collaboration of public entities, police forces, and State security bodies, when necessary, without need of judicial order;

• 6)

  To examine the hygienic conditions of work places and the personal safety conditions that these offer to workers; they must particularly ensure that all provisions in force on prevention of work accidents and occupational diseases are complied with;

• 7)

  They must intervene in all labor difficulties and conflicts of which they have notice, whether they arise between workers and employers, only among workers, or only among employers, in order to prevent their development or achieve their extrajudicial settlement, if they have already arisen; and,

• 8)

  Inspectors must take special care that all precepts whose compliance guarantees good relations between employers and workers are respected.

Labor Inspectors, within the scope of their respective competencies and without prejudice to the powers that the Law grants to other Labor Authorities, must provide information and advice to workers and employers regarding the guidelines and provisions relating to:

• 1)

  General Conditions of Work;

• 2)

  Safety and Health at Work; and,

• 3)

  Other matters regulated by labor legislation that by their importance so require. The advice and technical information that Labor Inspectors provide to workers, employers or to their respective organizations, in no case and under no circumstances must include the disclosure of industrial or commercial secrets, nor of manufacturing or exploitation procedures of which the authority has knowledge through the exercise of its functions; in case of non-compliance with this provision they are subject to the application of the corresponding disciplinary measures, without prejudice to the civil and criminal liability that may correspond.

Labor Inspectors must conduct the Inspections that are ordered to them and must be selected in accordance with a random system, except in cases where Inspections require a certain degree of specialization. In the latter case, the competent Regional Head of Inspection must freely assign the Labor Inspector or Inspectors who must carry them out, taking into account the capacity, dimension and complexity of each case.

When pertinent, the General Directorate of Labor Inspection (DGIT), may assign Labor Inspectors to other regions, in accordance with the needs of the service. It may also arrange for the conduct of activities outside the limits of the assigned territorial body, either through the temporary assignment of inspectors to another Regional Inspectorate or through the assignment of verification activities on companies or sectors with activity in the territory of more than one region.

The Body of Technical Collaborators and/or Experts of the General Directorate of Labor Inspection (DGIT) must participate in the inspection activity, applying their specialized knowledge for the benefit of the respective work, when necessary. For such purposes they must be previously designated by the Labor Authorities, a fact that must be recorded in the order of the respective Inspection.

Technical Audit Inspectors have the responsibility to verify the quality of the books and of the Labor Inspectors; consequently, they are empowered to attend to and investigate complaints filed against any Labor Inspector and other technical personnel of the General Directorate of Labor Inspection (DGIT). Public servants assigned to this office are invested with authority for the fulfillment of their functions, so they can participate directly in verification, information and advisory activities, and will also conduct supervisory inspections to corroborate the veracity of the facts recorded by Labor Inspectors in documents, reports or minutes generated by reason of Inspections, for which employers may provide all kinds of facilities, support and assistance, including those of an administrative nature, such as: access to computer equipment, internet, office supplies, printer and physical space for the development of the Inspection, among others.

During supervisory Inspections, the Labor Authority must review only that documentation or installations regarding which there are indications of presumed irregular activities in which the Labor Inspector may have engaged.

If, as a result of the supervision, facts, acts or omissions are detected that could contravene the regulations, the matter must be referred to the superior authority with the documents that support the complaint, so that it determines what is appropriate under law. In any case, they must report in particular any irregularity that occurs in the work carried out within the General Directorate of Labor Inspection (DGIT). In case the commission of a serious offense is established, the Nominating Authority in accordance with the norms of the Civil Service Law and its Regulations and the Internal Regulation of the Secretariat of State in the Offices of Work and Social Security, must dismiss the employee involved, with justified cause to the employee involved, without any liability to the State.

The Honduran Institute of Social Security (IHSS), the General Treasury of the Republic (TGR), the Tax Administration, the Attorney General of the Republic (PGR) and other State institutions, must facilitate the General Directorate of Labor Inspection (DGIT), upon request of the same, the information they have available and that is necessary for the exercise of its functions and competencies in the labor sphere, with the restrictions that the Law imposes on the aforementioned Institutions.

Civil authorities, police forces and State security bodies are obligated to provide their aid and cooperation to the General Directorate of Labor Inspection (DGIT) in the performance of its functions, upon the request of the Labor Inspector.

Employers, workers and representatives of both, as well as other subjects responsible for the fulfillment of labor standards, are obligated to cooperate with Labor Inspectors when required to do so. TITLE II MECHANISMS FOR PROMOTION OF COMPLIANCE

Only the Labor Authority is empowered to conduct labor inspections and supervisions, as well as to certify compliance with labor regulations on the part of an employer. Labor Authorities must verify compliance with legal provisions in labor matters, through Mechanisms for Promotion of Compliance, with the purpose of certifying the same. For the implementation and operation of Mechanisms for Promotion of Compliance, the General Directorate of Labor Inspection (DGIT) must maintain a registry of employers who voluntarily wish to enter and implement these mechanisms, being able to make use of information technologies. The Regulation, the scope, the design of the mechanisms and the operation for the application of the Mechanisms for Promotion of Compliance must be elaborated in a tripartite manner and published in the Official Gazette "La Gaceta" and in the Transparency Portal of the Secretariat of State in the Offices of Work and Social Security. TITLE III INSPECTIONS CHAPTER I GENERAL PROVISIONS

All Work Centers and Private Employment Agencies are subject to surveillance and promotion of compliance with labor legislation, in accordance with the competency of each of the Labor Authorities, in accordance with the Inspection Programs. Surveillance and promotion of compliance with labor regulations in Work Centers must be carried out through Inspections or, through Mechanisms for Promotion of Compliance in accordance with what is established in Title II of this Law.

The General Directorate of Labor Inspection (DGIT) must prepare the Inspection Programs, which must contain at least:

• 1)

  The authority responsible for its execution;

• 2)

  The period or periods in which it must be applied;

• 3)

  The objectives;

• 4)

  The goals;

• 5)

  The protocols, guidelines and guiding criteria; and, 6) The surveillance or promotion of compliance actions with labor legislation, as well as information and advice on labor regulations and inspection activities, including those agreed upon in the various instances of dialogue with productive sectors. For the preparation of Inspection Programs, the main organizations of employers and workers can be called upon, in order to take into account the opinions, suggestions and priorities that they may formulate and that the General Directorate of Labor Inspection (DGIT) considers pertinent.

For the development of the Inspections referred to in this Law, the General Directorate of Labor Inspection (DGIT) must ensure that the protocol, the design of the formats, Inspection orders, minutes and other actions in accordance with the Regulation of this Law, have proper clarity and uniformity.

The Labor Inspector, when conducting any of the Inspections referred to in this Law, must keep the employer, the workers and representatives of both, informed of the scope and effects thereof. Labor Authorities must use information systems, via telephone and internet, that have a call recording service and even assign them identification codes. The refusal of the employer or the inability to corroborate the authenticity of the order in the terms of this paragraph do not prevent the conduct of the Inspection, a fact that must be recorded by the Labor Inspector in the corresponding minutes.

The records and reports drawn up and submitted by Labor Inspectors in the exercise of their authority as delegated officials have full validity insofar as their inaccuracy, falsity, or bias is not demonstrated in an evident manner.

The action of the General Labor Inspection Directorate (DGIT) extends to all subjects obligated or responsible for compliance with labor regulations, whether they are natural persons, legal entities, public or private. Actions are exercised in private and public enterprises, work centers, and any other space where there exists a labor relationship. In the case of residences where domestic workers provide services, the express consent of the employer must be obtained when it concerns their domicile.

Work centers, establishments, premises, and facilities whose supervision is legally attributed to other public sector bodies must continue to be governed by their specific regulations in the Civil Service Law, without prejudice to the competence of the General Labor Inspection Directorate (DGIT) in matters not affected by the same.

Employers, workers, and representatives of both, as well as all other subjects responsible for compliance with labor standards, are obligated to collaborate with Labor Inspectors when required to do so. In particular, and in fulfillment of said collaboration obligation, they must:

• 1)

  Receive them properly at the Work Center during inspections, providing them with the facilities necessary for the performance of their work;

• 2)

  Identify themselves and the persons found in work centers or places;

• 3)

  Collaborate on the occasion of their visits or other inspection activities;

• 4)

  Declare on matters related to inspection verifications;

• 5)

  Immediately provide the information and documentation necessary for the development of their functions; and,

• 6)

  Ensure the safety of the Labor Inspector and refrain from putting at risk their physical integrity during the course of the inspection within work centers.

The General Labor Inspection Directorate (DGIT) may request the collaboration of the respective employer and worker organizations in cases where such organizations exist, if deemed necessary. This Directorate shall periodically publish information on aspects of general interest deduced from inspection activities, activity reports, and other background information. CHAPTER II TECHNICAL ADVISORY INSPECTIONS

Labor Authorities must, at the request of a party or in execution of Inspection Programs, conduct Technical Advisory Inspections with the purpose of promoting among workers and employers, among other aspects, compliance with labor regulations, decent work, labor inclusion, the promotion of formal employment creation, and promoting a culture of occupational risk prevention, highlighting in all cases fundamental rights at work.

As a result of these Inspections, the Labor Authority must determine, as appropriate, the preventive or corrective actions that employers must implement, as well as the timelines for their execution. During these periods, the Labor Authorities and employers, taking into account the nature of the actions to be implemented, may schedule follow-up and control visits.

If follow-up visits result in violations of labor legislation, an Extraordinary Inspection must be scheduled and, in its absence, the administrative sanctioning procedure must be initiated. The same shall apply in those cases where during Technical Advisory Inspections the employer refuses to receive the visit or to carry out or adopt the necessary measures aimed at regularizing their legal situation or to prevent or reduce Imminent Hazards or Risks detected. CHAPTER III ORDINARY AND EXTRAORDINARY INSPECTIONS

Labor Inspectors must conduct at Work Centers ordinary inspections on business and non-business days and hours, without prior notice and with the formalities provided for in the Law, provided that the Work Center is operating on those days and hours; classified as:

• 1)

  Initial: Those conducted for the first time at Work Centers or due to their expansion or modification;

• 2)

  Periodic: Those conducted at intervals of six (6) months, a period that may be extended or reduced in accordance with the evaluation of results obtained from previous Inspections, taking into account the economic activity on a periodic basis, establishing a random system to determine annually or semi-annually the schedule in which Work Centers must be inspected. The scheduling of these Inspections must be conducted by economic activity on a periodic basis, establishing a random system to determine annually or semi-annually the schedule in which Work Centers must be inspected. The Technical Audit Unit of Inspection must verify the correct operation of said system; and,

• 3)

  Verification: Those conducted when it is necessary to verify compliance with measures previously ordered or mandated by the Labor Inspector. Labor Authorities may authorize the conduct of this type of visits on non-business days and hours.

The Labor Authority may order the conduct of Extraordinary Inspections at any time, even on non-business days and hours for the State Secretariat of Labor and Social Security, when any of the following circumstances occurs:

• 1)

  They become aware that there exists an Imminent Hazard or Risk:

• 2)

  When they receive complaints or reports by any means or form of possible violations of labor legislation; or, when they learn by any verbal or written channel of probable violations of labor standards; in these cases the inspection must be initiated within a maximum period of five (5) business days. In case the complaint or report is filed by the worker, the information that reveals their name or identity must be declared under confidentiality by the Labor Authority at the request of the complainant; without prejudice to the right of defense that belongs to the reported party;

• 3)

  When, upon reviewing documentation presented for any purpose, they become aware of possible irregularities attributable to the employer or to the worker who conducted themselves with falsity;

• 4)

  They become aware of accidents or incidents occurring at Work Centers;

• 5)

  When during the course of a previous Inspection or in the presentation of documents before the Labor Authority, the employer or worker or their representatives provide false information or conduct themselves with deceit, bad faith, or violence; and,

• 6)

  Inspection records or documents are detected that lack the requirements established in applicable provisions or from which elements emerge to presume that the Labor Inspector engaged in irregular conduct.

Labor Inspectors must conduct ordinary Inspections in accordance with the provisions of articles 12, 13, 14, and 15 of this Law, and must draw up the respective record in accordance with its Regulation, specifying the name of the employer or their legal representative, address and location of the Work Center, the day on which the proceeding is conducted, the type of Inspection, the number and date of the corresponding Inspection order, accompanying a list of documents that the employer must exhibit, the aspects to be reviewed, and the legal provisions on which the inspection is based.

Extraordinary Inspections must be conducted by Labor Inspectors without prior notification, in order to satisfy their main objective of immediately detecting the situation that prevails at the inspected Work Center.

At the beginning of ordinary or extraordinary Inspections, the Labor Inspector must deliver to the employer or worker or their representatives, as appropriate, the official document containing the inspection order issued in proper legal form. Said Inspection orders must specify the Work Center to be inspected, its location, the objective and scope of the proceeding, its legal basis, as well as the telephone numbers through which the employer can communicate to verify the data of the corresponding order. The Labor Inspector must exhibit a current credential with photograph, issued by the competent authority that accredits them to perform their functions.

At the time an Inspection is conducted, both the employer and their representatives are obligated to allow the Labor Inspector access to the Work Center and, as applicable, of technical collaborators and/or expert professionals in the subject matter authorized for such purpose, likewise the Labor Inspector may request the assistance of members of existing commissions at the Work Center and of the most experienced personnel thereof; providing all types of facilities, support, and assistance, including those of a logistical nature, so that the Inspection is conducted and for the drawing up of the respective record, as well as providing the information and documentation that may be required of them and which is required by Law, its regulations, Occupational Safety and Health Standards, and other applicable provisions in the matter.

A detailed record must be drawn up of every Inspection, with the participation of the employer and the complaining or complained-of workers, the legal professionals who represent them or members or representatives of the Union Steering Committee, in case such an organization exists in the company. Upon completion of the inspection, the inspector must deliver to the parties a signed and sealed copy by them of the record that is drawn up. Said record must be signed as well by the parties and other persons who participated in the inspection proceeding and became aware of the matters dealt with therein.

In the event that the employer or their representative opposes the practice of the ordered inspection, the Labor Inspector shall record in the respective act for all legal purposes, it being presumed that indeed such employer has failed to comply with the legal provisions whose violation is attributed to them, unless proven otherwise. To which end, proceedings must be conducted in accordance with Article 15, numeral 5) of this Law, independently of the corresponding administrative sanction.

In the case of Ordinary Inspections, when the Inspection procedure cannot be carried out due to justified causes beyond the control of the employer or the worker, the Labor Inspector shall record the fact and its description in an act, for the purpose of rescheduling the visit, in accordance with the corresponding Inspection Programs, prior notification to the employer or the worker in accordance with what is provided in this Law. In any case, rescheduling may occur only once.

If during the practice of an Ordinary Inspection it is detected that the Work Center employs ten (10) or fewer workers and the company as a whole has no more establishments or branches than the visited location, the Labor Inspector must note this circumstance in the act and conduct the visit in the terms established in Chapter II of Title III, concerning Technical Advisory Inspections of this Law.

During the Inspection, the Labor Inspector must ask questions of the workers and the employer or their representatives separately, which must refer solely to the matter subject of the Inspection, with the objective of avoiding possible influence on the responses of the declarants. The questions formulated and the responses obtained from the interviews conducted must be contained in the special annex of the inspection act. To prevent actions that violate the rights of denouncing workers and witnesses, the Labor Inspector must keep the respective annex under confidentiality. In the event of a written request presented by the employer before the Labor Authority, aimed at knowing the name and personal data of the interviewed workers, such information must be made available to them, who upon receiving it must sign under oath that they will not take actions that violate the rights of the workers or against the persons interviewed, it being understood that if the employer breaches their oath, their actions must be qualified by the Labor Authorities as a consequence of the declarations and interviews, and by virtue thereof the employer is subject to the corresponding administrative sanction, unless proven otherwise, in accordance with the provisions of Article 88 of this Law, without prejudice to the adoption of remedial measures for the violated norm. The request and procedure referred to in this Article form part of the file, which must be properly kept in the General Directorate of Labor Inspection (DGIT), for legal purposes.

The Labor Inspector, once the documents required in the inspection order or in the attached list have been exhibited, must record clearly in the act the content and characteristics thereof, refraining from incorporating subjective assessments or those without support in accordance with the regulations being monitored.

When the Inspection reveals possible violations of labor regulations, the Labor Inspector must require those inspected to accompany, where applicable, a copy of the documents that serve as evidence in the Inspection acts that are drawn up. Likewise, the employer during the Inspection may remedy a fact or situation detected, with the facts and the solution implemented being recorded in the respective act.

If during the Inspection it is identified that the documentation in the possession of the Work Center refutes the reported violations or proves compliance with the obligations contained in labor regulations, the Labor Inspector must record that such documentation was reviewed, making relevant transcriptions and annotations to the act and, where appropriate, must attach copies of such documentation to it, which must be signed by the employer, the workers or the representatives of both.

Before concluding the preparation of the corresponding act, the Labor Inspector must allow the persons who have participated in the inspection procedure to review the act, so that they may formulate observations or offer the evidence that corresponds to their rights, with the Labor Inspector being required to record such statements in the body of the Inspection act and immediately thereafter must read the entire act aloud. The Labor Inspector must require the persons who have participated in the procedure to sign, and in case of refusal, such fact must be recorded, without this affecting the validity thereof, proceeding to deliver a copy of the corresponding act to the parties.

When in the Inspection act, the Labor Inspector finds infractions of labor regulations, the inspector must grant employers a period of up to three (3) days to one (1) month to correct the deficiencies and non-compliance that in the inspector's judgment are identified and, where applicable, exhibit the documentation proving compliance with obligations in any of the matters referred to in Article 16 of this Law. Such periods must be set taking into consideration the industrial sector, type and economic scale, degree of risk, number of workers, the risk they represent for such workers, and the difficulty in remedying them.

The granted periods may be extended, on a single occasion, up to half of the originally granted period, provided that the life, safety and health of the workers is not placed at risk and a written request from the interested party is made before the expiration of the granted period, in which the justification must be included indicating the reasons why it is not possible for them to comply within the established period.

For the purposes set forth in Article 54, the Labor Inspector must issue a documentary summons, in which the ordered measures and the period within which they must be implemented are specified, or alternatively, the period to exhibit documentation proving compliance with their obligations, documentation that the inspector is obliged to verify with those affected, an act which must be signed by the employer or representative and notified to the workers or their representatives. Upon expiration of the period or extension granted timely as referred to in Articles 54 and 55, the procedure is forfeited by law and irrevocably lost if not utilized, without need for compulsion, the passage of the term being recorded ex officio and the respective procedure being continued.

In the event that non-compliance with the ordered measures is verified or documentary proof of compliance with labor regulations is not provided within the periods granted in the terms of Articles 54 and 55, a request must be made to the competent body of the Labor Authorities to initiate the administrative sanctioning procedure.

The Labor Authority may order the definitive filing of Inspection acts when:

• 1)

  They do not contain the requirements established in the applicable legal provisions, in which case such act must be annulled ex officio, ordering the Inspection subject of the annulled act to be practiced anew; in case the employer remedies the infractions in the terms established, definitive filing of the proceedings proceeds immediately;

• 2)

  No non-compliance with labor regulations is verified; and,

• 3)

  From the evidence presented by the employer or their representative within the periods established in this Law, it proves compliance with labor regulations or compliance with the remedial measures ordered by the Labor Inspector in the corresponding Act. The resolution issued in any of the aforementioned cases must be notified to the employer and to the workers or their representatives.

When the Labor Authority becomes aware, by any means or form, that in a Work Center there exists a situation of Danger or Imminent Risk, it must schedule an Extraordinary Inspection, so that through a Labor Inspector, accompanied by a qualified Expert in the matter if necessary, the existence of such Danger or Imminent Risk may be verified, in which case, it must immediately order the corrective measures to eliminate the risk and the preventive measures to avoid the occurrence or happening of loss, all for the purpose of safeguarding the life, physical integrity, and health of the workers or, in its case, the facilities of the company. This same procedure is established for the case when an ordinary inspection detects the existence of an Imminent Risk to the health and safety of the workers. Such measures, depending on each case, may consist of the total or partial suspension of the activities of the Work Center and even the restriction of worker access to part or all of the Work Center, until such time as the necessary safety measures are adopted to prevent an accident from occurring.

In the event that the employer refuses to receive the Labor Inspector, the latter must record the refusal in the act or report and remit it to their hierarchical superior immediately so that the corresponding administrative sanctioning procedure may be initiated. In the case of Work Centers located within the Mining Industry or another by designation of the General Directorate of Labor Inspection (DGIT), the latter must request, within the twenty-four (24) hours following receipt of the act of refusal by the employer, the assistance of police forces or State security bodies, for the purpose of proceeding with the development of a new Inspection and safeguarding the integrity of the Labor Inspector and the workers. Such assistance must be provided immediately without need to obtain prior judicial authorization. In the event that the required assistance is not provided at the time of conducting the Inspection, this fact must be recorded in the act, sending a copy thereof to the Public Ministry (MP), in order to determine responsibilities.

To establish the restriction of access or limitation of operations in a Workplace, the Labor Inspector, based on the expert opinion, prior to closing the corresponding report, must describe in detail in the Inspection Report: the physical or documentary conditions that, if not complied with or observed, produce an Imminent Danger or Risk; indicate the activity or activities to limit or the area or areas to restrict and issue the necessary safety measures to prevent or correct a situation of imminent risk; likewise, must communicate, through their hierarchical superiors, to the General Direction of Labor Inspection (DGIT), regarding the circumstances that motivate the restriction of access or the limitation of operations, through a detailed written report within the twenty-four (24) hours following, sent by any means, which must contain:

• 1)

  Place and date of preparation;

• 2)

  Legal basis;

• 3)

  Type, date and number of Inspection;

• 4)

  Description of whether the inspection is conducted ex officio or at the request of a party;

• 5)

  Name, business name or corporate designation and address of the Workplace;

• 6)

  Description of the conditions of Danger or Imminent Risk related in the expert opinion;

• 7)

  Activity or activities to limit, as well as the area or areas to restrict;

• 8)

  Immediate application safety measures necessary to prevent or correct the situation of Danger or Imminent Risk; and,

• 9)

  Name and signature of the acting Inspector and the Expert who has intervened in the inspection proceedings. A copy of the report drawn up in relation to this inspection must be delivered to the parties.

The head of the General Direction of Labor Inspection (DGIT), must consider the elements deemed appropriate to determine, within the twenty-four (24) hours following receipt of the report referred to in the previous Article, the advisability or not of authorizing the restriction of access, limitation of operations or both, which must be made known to the acting Labor Inspector, as well as to the head of the corresponding Regional Labor Authority. For the General Direction of Labor Inspection (DGIT) to determine to authorize access and resumption of operations or both, a new inspection is necessary.

Once the second inspection has been conducted, if from it results that there still exists an imminent risk that could cause serious harm to workers or to the Workplace and such assessment coincides with the expert opinion, the General Direction of Labor Inspection (DGIT), must ratify the safety measures ordered by the acting Labor Inspector, which must continue until the danger sought to be prevented disappears. A copy of the report drawn up in this second inspection must be delivered to the parties.

Within the term of seventy-two (72) continuous hours computed from the closure of the second inspection report, the Labor Inspector, with the evidence or statements presented by the employer and after consultation with the head of the General Direction of Labor Inspection (DGIT), must determine whether the restriction of access or the limitation of operations in the areas of detected risk is lifted or establishes the expansion of these actions, until such time as the safety measures ordered for the proper operation of the Workplace are complied with.

The restriction of access or limitation of operations referred to in this Chapter must be lifted by the Labor Inspector, once the employer or their representative proves to have complied with the ordered measures, remedying the deficiencies that motivated it.

If it is verified that the Labor Inspector, exercised any of the preventive or corrective measures established in this Chapter, acting with fraud, bad faith or negligence, the competent authority must proceed without any delay to impose the corresponding administrative and criminal liability, without prejudice to the civil liability that such conduct causes. TITLE IV ADMINISTRATIVE PROCEDURE FOR THE APPLICATION OF SANCTIONS CHAPTER I ADMINISTRATIVE SANCTIONING PROCEDURE

The administrative procedure for the application of sanctions is initiated ex officio, by virtue of Inspection reports, as well as reports of obstruction to the inspection work. If from the assessment of the reports, files and/or official documentation or by any other authority and the contributions made by the employer or their representative, the non-compliance with labor regulations is not refuted within the periods referred to in Article 54 of this Law, the Labor Inspector must request the Head of Regional Inspection to initiate the administrative sanctioning procedure.

Within two (2) days following receipt of the request to initiate the administrative sanctioning procedure, the competent body of the Labor Authorities must charge the employer or the person to whom it is attributed, so that in a hearing within the maximum term of five (5) business days, they submit their defense or what is appropriate to their right and offer relevant evidence.

The service of process for initiation of the administrative sanctioning procedure must contain:

• 1)

  Place and date of its issuance;

• 2)

  Name, business name or corporate designation of the alleged violator;

• 3)

  Address and domicile of the Workplace;

• 4)

  Date of the Inspection report;

• 5)

  Legal basis of the authority issuing the service of process;

• 6)

  Circumstances or facts that appear in the report, which are considered violative of labor legislation, as well as the legal provisions considered to be transgressed;

• 7)

  Date, time and place of the hearing for defense;

• 8)

  In the event that the alleged violator has formulated observations or offered evidence at the time of inspection and in relation to the facts stated in the service of process report, the specific reasoning must be indicated to establish that they were analyzed and assessed;

• 9)

  Warning that, if the alleged violator does not appear at the hearing within the known term, as the case may be, the procedure will be followed in absentia, taking as true the facts attributed to them; and,

• 10)

  Date and signature of the competent authority.

Notifications of the proceedings carried out for the practice of Inspections and the application of sanctions for violations of labor legislation must be made in the manner and terms established for such purpose by this Law and, subsidiarily, by the Administrative Procedure Law and the Civil Procedural Code.

The following must be subject to personal notification through delivery of a complete copy of the act in question, by a Labor Inspector to the employer or their representative, to the worker or their representative and to the labor union as applicable; by dispatch through electronic means or, by notice posted on the corresponding bulletin board, in the terms of the provisions of this Law, when applicable:

• 1)

  The service of process acts by virtue of which periods are granted to employers to adopt the necessary measures regarding violations of labor legislation in matters of labor relations, safety and health at Work;

• 2)

  Requirements aimed at verifying compliance with the obligations derived from the Law and other applicable provisions in the matter;

• 3)

  Service of process to alleged violators, so that they appear at the hearing or, as the case may be, appear in the administrative procedure for the application of sanctions;

• 4)

  The orders issued by the Labor Authorities for the application of sanctions regulated by this Law;

• 5)

  The resolutions issued by the competent Labor Authorities;

• 6)

  Delivery of documentation at the request of an interested party; and,

• 7)

  Any other order or requirement related to the application of the legal system in labor matters. In any case, the act of notification via electronic means referred to in this Article is appropriate provided that the correct receipt of the same can be reliably verified and that the digitalized documents exist in the original or are found in a properly compared or authenticated photocopy and are available to the individual in the file constituted for such purpose. Notification by electronic means must be practiced directly to the intervening parties, when they do not have an accredited representative in the proceedings in question. When it is demonstrated that there are actions to avoid notification by the employer, the respective sanction must be applied.

Once the provisions established in Article 517 of the Labor Code have been completed by the workers, the General Direction of Labor (DGT), must establish an electronic database to receive notifications from workers of their intention to organize a union in a company. When workers notify their employer by email, a copy must be sent to the aforementioned electronic address of the General Direction of Labor (DGT) with receipt of acknowledgment to the employer and workers. In the receipt of acknowledgment in an automatic manner, the General Direction of Labor (DGT) must indicate that the signing workers are under the special protection of the State, from the moment they notified the employer. Consequently, from the date of notification until receiving the certificate of legal status, none of those workers can be: dismissed, transferred or worsened in their working conditions without just cause, previously qualified by the respective authority.

In cases of dismissals, transfers or worsening of the working conditions of workers who are under special protection of the State, the General Direction of Labor Inspection (DGIT), must issue notification reports to employers requiring the reinstatement of dismissed workers and unionized leaders and must conduct follow-up inspections to verify compliance with the required actions according to judgment. In cases of non-compliance, the corresponding sanctions must be imposed and workers must be urged to use the free services of the General Labor Procuracy (PGT) to continue judicial action. CHAPTER II SUBSTANTIATION OF THE PROCEDURE

The respondent may appear at the hearing or exercise their rights: 1) Personally or through a legal representative, in the case of natural persons; and, 2) Through their legal representative or legal representative, in the case of legal entities.

The accreditation of capacity must be made in accordance with the provisions of the Administrative Procedure Law that are applicable. In any case, the Labor Authorities must consider the capacity of the appearing parties to be accredited, provided that, from the documents exhibited, from the proceedings that appear in the files or from the records to accredit capacity constituted for such purpose, full conviction is reached that they effectively represent the interested party.

The respondent may offer any means of proof to contradict the content of the Inspection reports. For the admission of evidence, the Labor Authorities must comply with the following rules:

• 1)

  Evidence must be related to the specific facts, acts or omissions that the respondent alleges;

• 2)

  The inspection may be used when permitted by the General Directorate, Headquarters or competent Regional Office of Labor Inspection in a clear and effective manner, to assess, by the external characteristics of the inspected item, the fact being investigated; and,

• 3)

  Evidence consisting of reports or communications from other authorities are only admissible when the alleged violator demonstrates the impossibility of presenting them themselves.

Once the evidence offered by the respondent has been received, the evidence must be admitted or rejected during the proceeding, setting, where applicable, the day and time for the continuation of the discharge hearing, for the purpose of presenting the corresponding evidence, which must take place within a maximum period of ten (10) business days.

Once the respondent has been heard and the admitted evidence has been presented, an order closing the hearing must be issued, in order to record the result that resolves the matter. The respondent must be notified of the order recording the result. CHAPTER III RESOLUTIONS

The resolutions issued by the Regional Headquarters of the General Directorate of Labor Inspection (DGIT), in which sanctions are imposed for violations of labor legislation, must contain:

• 1)

  Place and date of issuance;

• 2)

  Authority that issues it;

• 3)

  Name, business name or corporate designation of the violator;

• 4)

  Address and location of the Workplace;

• 5)

  Statement of the proceedings on file, including the evidence admitted and presented and in general the rationale for the resolution;

• 6)

  Legal provisions on which the competence of the issuing authority is based, as well as the legal basis on which the resolution is founded;

• 7)

  Identification of the affected workers, which may be a generic group of workers in cases of conflicts of a collective nature;

• 8)

  Operative parts;

• 9)

  Warning for compliance with the violated norms; and,

• 10)

  Name and signature of the public official that issues it.

Resolutions must be issued within five (5) business days following the date on which the discharge hearing is concluded.

A resolution that becomes final has the character of an enforceable title with respect to the obligations it contains. CHAPTER IV VIOLATIONS

Administrative violations in labor matters constitute non-compliance with the obligations contained in the labor law system, including those contained in the Constitution of the Republic and this Law, and those related to occupational safety and health, social security, labor insertion, collective agreements or working conditions and international labor standards ratified by Honduras, through action or omission of the various subjects responsible for their compliance.

Specifically, child labor must be considered as an administrative violation, and the Labor Inspector must immediately ensure the following: 1) Order the removal of children when they are found in work places where dangerous tasks are being performed and free communication is provided to the competent authorities; and, 2) Full protection of the health and safety in the workplace is provided for children who have reached the minimum authorized age of admission to employment, in accordance with what is stipulated in the Constitution of the Republic, Labor Code, Code of Childhood and Adolescence and other laws of the country.

Also constituting an act of obstruction of the Labor Inspection function is the unjustified refusal or impediment to carrying out an inspection at a Workplace or in certain areas thereof, carried out by the employer, its representative or employees, whether employed by the company or not, or by third parties, by order or directive of the employer. The impediment may be direct or indirect, prejudicing or delaying the diligence of the Labor Inspector or is of such nature that it does not allow the completion of the inspection. Likewise, it is an act of obstruction of the Labor Inspection function to obstruct the participation in the inspection of the complaining worker or their legal representative or of the organization of workers established at the Workplace, represented by its President or by the person designated by that authority.

When compliance with the obligations provided for in a normative provision corresponds to several subjects jointly due to the substitution of the employer and/or change of business name, they respond jointly and severally for the violations that may be committed and for the sanctions that are imposed. In the cases of companies whose assets are the property of natural or legal persons domiciled abroad, the solidarity mentioned above must pass to the partners and/or representatives of such companies.

The sanctioning authority and where applicable the application of the corresponding sanction must be exercised by the Heads of the Body of Inspectors of each Regional Labor Office or the labor authority acting in their stead, as first instance, with the General Directorate of Labor Inspection (DGIT) constituting the second and final instance, exhausting the administrative remedies with its pronouncement.

Violations or non-compliance with the obligations referred to in this Law must be sanctioned with a monetary fine, in accordance with the provisions of this Chapter.

If as a consequence of the employer's non-compliance with its obligations, personal, real, certain and/or quantifiable damage is caused to the worker, the imposition of sanctions for each affected worker is warranted.

When the employer violates a labor norm that causes the worker economically quantifiable damage in money, a fine must be imposed on the violator equivalent to twenty-five percent (25%) of the economic damage caused, with the employer obligated to correct the violation of the infringed norm by paying the affected worker the total amount of the legally owed sums. If the violation of the labor norm prejudices the economic interests of more than one (1) worker, the fine must be applied for each affected worker. In any case, the amount of the fine for the violation cannot be less than Five Thousand Lempiras (L.5,000.00) per worker, when the twenty-five percent (25%) of the quantifiable economic damage is less than the amount mentioned above. When the employer remedies the causes for which they have been sanctioned within ten (10) business days following notification of the resolution ending the sanctioning procedure, the imposed fine must be forgiven. It is expressly understood that the above benefit may be granted to the employer only once for the same violation.

When fundamental rights protected to workers by the Constitution of the Republic, the labor law system and international labor standards ratified by Honduras are violated or infringed, the damage of which is not quantifiable in money, the amount of the sanction or fine must be One Hundred Thousand Lempiras (L.100,000.00); if the violation is committed against different norms, the aforementioned fine must be applied for each violation. Any person who, through violence or threats, attempts in any way against the right to freedom of association or freedom of association, must be sanctioned with a fine of Three Hundred Thousand Lempiras (L.300,000.00) and the administrative violation must be considered as a single infraction. In cases of obstruction of the labor inspection function, the violation must be sanctioned with a fine of two hundred fifty Thousand Lempiras (L.250,000.00) and the administrative violation must be considered as a single infraction. When the employer fails to comply with the obligation to execute a collective agreement, the fine must be Two Hundred Thousand Lempiras (L.200,000.00). When the employer remedies the causes for which they have been sanctioned within ten (10) business days following notification of the resolution ending the sanctioning procedure, the imposed fine must be forgiven. If the employer does not remedy the cause for which they were sanctioned within the known time period, they must be obligated in addition to payment of the fine to correct the violation that is its object. If the employer refuses to remedy such causes within the established time periods, the Secretariat of State in the Office of Labor and Social Security through the corresponding body must promote the pertinent actions, without prejudice to the application of the pecuniary sanctions that this Law establishes for recidivism.

The pecuniary sanctions established in this Law must be increased annually in automatic form in proportion to the year-on-year inflation index declared in the month of December of each year by the Central Bank of Honduras (BCH).

In any case, recidivism by the offender in the commission of an administrative infraction gives rise to the application of new pecuniary sanctions with an increase of twenty-five percent (25%) in the first recidivism, with a forty percent (40%) increase until compliance with the violated or transgressed labor norm is verified. The percentage increase that corresponds must be applied to the last fine imposed. For such purposes, each of the subsequent infractions to the same legal provision, committed within the term of one (1) year counted from the date of the act in which the first infraction was recorded, must be considered as recidivism.

The Labor Authorities must periodically schedule as many inspections as may be required or must require the presence of the offender at the seat of the Labor Inspection, as the case may be, to verify that the responsible party has complied with their labor obligations, especially those for which a final sanction has been imposed. In the event that the corresponding inspection verifies the continuity of non-compliance, the responsible party must be sanctioned for recidivism without the need to require them again.

Sanctions must be imposed without prejudice to the penalties that correspond to the crimes in which offenders may incur. When the content of the proceedings reveals facts that constitute the possible commission of a crime, the Labor Authorities must file the respective complaint with the Public Ministry. In the same manner, these sanctions are understood without prejudice to any civil or labor action that corresponds in accordance with ordinary justice.

The maximum term for payment of pecuniary fines is fifteen (15) business days, counted from the date on which the administrative resolution imposing it becomes final. When the aforementioned term has expired and the offender has not made payment of the fine effective, the Labor Authorities must remit to the General Procuracy of the Republic (PGR), certification of the resolutions that are issued, in order that it proceed to make the imposed fines effective. The General Procuracy of the Republic (PGR) must inform the Labor Authorities of the fines that it makes effective monthly, through the appropriate mechanisms that allow them to be identified and monitored. The amounts arising from the imposition of fines must be deposited in their entirety to the General Treasury of the Republic (TGR). By the Single Cash System. TITLE V REMEDIES

Against the resolutions that conclude the administrative procedure for the application of sanctions, the Appeal is available before the same body that issued the contested act, and this body must forward it within a maximum term of three (3) business days to the General Directorate of Labor Inspection (DGIT), for its decision. The term for filing the appeal is ten (10) business days.

A copy of the appeal petition must be served to the other interested parties, if any, so that within a term of three (3) business days they may set forth whatever they deem appropriate.

The competent body, ex officio or at the request of a party, must order the production of evidence for a maximum term of ten (10) business days, when it deems that the elements gathered in the proceedings are not sufficient to resolve the appeal. After evidence is produced, the corresponding resolution must be issued within a maximum term of five (5) business days.

Against the resolutions issued by the General Directorate of Labor Inspection (DGIT), in relation to the appeal, the motion for reconsideration is available before the body that issued it. Reconsideration may be requested within ten (10) days following notification of the contested act. The resolution of the motion for reconsideration must conclude the administrative proceedings. TITLE VI MISCELLANEOUS PROVISIONS CHAPTER I FINAL PROVISIONS

Repeal Decree No. 39 of May 10, 1982; Chapter III of Title VIII and Article 469 of the Labor Code; Article 40 of the Minimum Wage Law and Article 128 of the Code for Children and Adolescents.

The Secretariat of State in the Offices of Labor and Social Security is empowered to issue the manuals, guides, and training courses necessary for the implementation of this Law. CHAPTER II TRANSITIONAL PROVISIONS

During the first twelve (12) months of the entry into force of this Law, the Secretariat of State in the Offices of Labor and Social Security must develop a comprehensive restructuring process of the General Directorate of Labor Inspection, with the objective of adapting to this Law and ensuring the highest levels of efficiency, impartiality, accountability, transparency, and morality in the tasks of promotion and oversight of compliance with labor norms, occupational safety and health, and those related to social security, as well as in the processes in which the corresponding responsibilities are required in cases of infraction or non-compliance. To this effect, through an external entity specialized in the matter, an evaluation of the professional experience and theoretical knowledge of the technical and administrative personnel involved in the Labor Inspection service must be conducted, so that those who pass the evaluation remain in their positions, being subject to what is prescribed in this Law; otherwise, they must be removed from their positions with full recognition of the labor rights and benefits that correspond to them, in accordance with the Civil Service Law.

Due to the integrity that characterizes the Inspection System, as of the entry into force of this Law, the Occupational Safety and Hygiene Inspectors and other technical personnel and/or Experts specialized in Occupational Safety and Health, as well as those from other areas, become part of the Body of Inspectors of the General Directorate of Labor Inspection (DGIT), being subject like the rest of the personnel of that office to the evaluation ordered by this Law.

The Inspection procedures and application of sanctions that are pending at the date of entry into force of this Law must be resolved in accordance with the provisions in effect at the time of their initiation.

The administrative provisions currently in force remain in effect, insofar as they do not conflict with this Law.

The Regulation for the application of this Law must be approved by the Executive Power through the State Department in the Offices of Labor and Social Security, within a period of ninety (90) days, from the date this Law enters into force.

This Law shall enter into force as of the day of its publication in the Official Gazette "La Gaceta". Given in the city of Tegucigalpa, municipality of the Central District, in the Chamber of Sessions of the National Congress, on the twenty-second day of the month of January of two thousand seventeen. ANTONIO CÉSAR RIVERA CALLEJAS PRESIDENT MARIO ALONSO PÉREZ LÓPEZ SECRETARY JOSÉ TOMÁS ZAMBRANO MOLINA SECRETARY To the Executive Power Therefore: Let it be Executed Tegucigalpa, M.D.C., 10 March 2017 JUAN ORLANDO HERNÁNDEZ ALVARADO PRESIDENT OF THE REPUBLIC THE STATE SECRETARY IN THE OFFICES OF LABOR AND SOCIAL SECURITY CARLOS MADERO BANCO LAFISE CONVOCATION The undersigned, Secretary of the Society and of the Board of Directors of the commercial company called BANCO LAFISE (HONDURAS), SOCIEDAD ANONIMA (BANCO LAFISE, S. A.), with instructions from the Board of Directors thereof, hereby CONVOKES all its shareholders to the General Assembly that will address matters of an Ordinary and Extraordinary nature, in accordance with the provisions established in articles 168 and 169 of the Commercial Code in force in the Republic of Honduras. Said Assembly shall be held on Thursday, the sixth (06) day of April of the year two thousand seventeen (2017), at two (02 P.M.), in the Training Room of the Human Capital Department of Banco Lafise, located on the first floor of Torre Lafise Procés, San Carlos neighborhood, Los Procés Avenue, Boulevard Morazán, Tegucigalpa, M. D. C. If a legal quorum is not met at that time, the Assembly shall be held with the shareholders who attend, the following calendar day, at the same time and in the same place. Tegucigalpa M.D.C., 14 March of the year 2017 Atty. Lizzeth Villatoro Secretary of the Society and of the Board of Directors BANCO LAFISE, S.A. 15 M. 2017