A role for World Bank Procurement

A role for World Bank Procurement

Construction Workers, Vulnerability

and International Labor Standards

Fiona Murie International Federation Building and Wood Workers24 March 2004

Working life in construction Construction provides much needed employment for

many of the world’s poorest, the most vulnerable people, low skilled or entry level workers

Of special importance for the landless poor Large numbers of rural - urban migrants look for work

in construction The industry is dominated by micro enterprises 90% of firms have less than ten workers 111 million workers; 75% in developing countries Workers are recruited through intermediary agents,

labor only subcontractors or directly at pick up points for day laboring

Decent Work This is the main policy agenda of the International

Labor Organization. Decent Work applies to all workers, including those on daily wages and in very temporary, informal employment.

Decent Work is work that is carried out in a safe physical environment with conditions which respect the rights of workers as defined in national law and international conventions.

Reality is far from decent Employment is almost completely informal Exploitative, dangerous, dirty working conditions Inhumane living conditions, no amenities, water,

shelter Hazardous Child labour in brick kilns

and quarries, roads and infrastructure Bonded Labour through debts and advances, especially

with migrant labour Discrimination in employment and Inequality in wages Exploitative wages and long working hours Active hostility towards workers who try to organise

Working Conditions Every year over 100,000 construction workers are

killed in site accidents Almost all of these deaths are foreseeable and

preventable 

Invisible and ignored Work related ill health accounts for many

hundreds of thousands of premature deaths. Asbestos diseases alone kill about 100, 000 people every year

yet…. Published data grossly underestimates the real

number of accidents, and reporting of work related ill health is practically non existent.

Building Ill Health Deafness Vibration syndromes Back injuries Musculo skeletal disorders Respiratory illness, asthma, cancer Central nervous system disorders Reproductive ill health Renal, hepatic,cardio-vascular problems Dermatitis Dengue, malaria HIV AIDS

Costs at macro economic level

Prevention of injuries and ill health is a development issue

4% GDP of any nation lost on workplace accidents and ill health

A practical area for immediate improvements and tangible benefits to the poor

Poverty Reduction Equitable access to fairly paid employment with

reasonable and safe working conditions is an essential element of any poverty reduction strategy

Real life problems of construction workers are addressed by International Labour Standards and very often by national laws which transpose them or which are in broad conformity with them

Exploitative employmentand labour practices

Precarious contractual conditions, informal work, migration

Workers seen as a cost by employers Productivity and time pressure Low trade union density, low social status,

poverty, lack of respect for human and trade union rights

Governments passive and permissive on workers rights and social protection

Laws essential but ignored Problem is not the legislation - it’s lack of

implementation in practice Recognize lack of capacity of governments to

enforce Lack of good governance and institutional

participation to promote Some employers will take advantage and exploit,

others are simply unaware Workers powerless given their lack of bargaining

power in an unequal labor market

Informality and cutthroatcompetition undermine rights

There is an extremely high level of competition in the construction industry and contractors win bids by lowering their costs.

Labor is a major component of these costs.

Construction contractThus the winning tender may well be the one which pays the lowest wages, does not provide safety equipment or have coverage for accidents, and which has the largest proportion of informal workers, for whom no tax or social security is paid, and who are not covered in practice by any legal or social protection.

Construction contract

In this situation, the construction contract becomes a potentially important mechanism both for taking forward the implementation of labor standards and for demonstrating the benefits.

There is a clear need for clauses that relate specifically to labor standards to be included and strengthened in the Bank’s SBDs and other Contract documents.

Construction contract

This places formal responsibility on the contractor, but it is important to develop a process around the contract, which involves awareness raising and capacity building for the client, contractor and employer, as well as for the workforce, and which puts in place agreed mechanisms for monitoring compliance.

International Labor Standards The ILO Declaration of Fundamental Principles

and Rights at Work (1998) Core Labor Standards cover four areas and are defined

in eight ILO Conventions Freedom of association and the effective recognition of

the right to collective bargaining, Elimination of forced or compulsory labor, Abolition of child labor Elimination of discrimination in respect of employment

and occupation.

Other Key ILS Health, Safety and welfare of the workforce to be

protected Wages to be paid in full and on time, to meet legal

minima and be sufficient for basic needs. Working hours to be limited; overtime to be paid All relevant social security regimes to be applied to

all workers without distinction. Rights to Workers’ Representation Convention 94 Labour Clauses in Public Procurement

The Bank’s SBDs and Contracts Modernize and strengthen current labor clauses in

Standard Bidding Documents The ILS should be integrated into World Bank

procurement as mandatory elements of the Bank's Standard Bidding Documents

Currently only a few recommended labor clauses are included in the SBDs.

Increasing trend is smaller contracts. The SBDs for smaller works do not include any

labor clauses.

SBDs and ContractsIn conformity with the Bank's poverty reduction objective and its recognition of the necessity to reduce workplace risks faced by the poor, key protections contained in ILO health and safety Conventions, the Convention guaranteeing regular and full payment of wages, as well as the Convention on Government Procurement should be included

ILS and the WB:making the ILS operational A clear policy statement from the Bank

expressing commitment to ILS The inclusion of new labor clauses and

strengthening of existing labor clauses in the Standard Bidding Documents and other contract documents

Implementation through mainstreaming ILS into the Country Procurement Assessment reviews and Reports, Country Assistance Strategies and Poverty Reduction Strategies

Making ILS operational Capacity building in member countries,

specifically in procurement and for the construction industry more broadly, including development of practical tools such as training courses and guidance notes.

Encouraging implementation through verification and monitoring of compliance.

Networking and increased cooperation on ILS in particular with the ILO but also with other multilateral development anks

Addressing worker’s rights All workers have rights, regardless of employment

status, but in real life Unorganized, exploitative working conditions and

inhumane living conditions,rural -urban migration as survival strategy

Address immediate needs for shelter and protection; water, fuel, food; child care and education; healthand above all employment and Decent Work.

Networking and Future work Work more closely with other IFIs, the ILO and the

social partners, such as the IFBWW and Contractors Associations

Capacity building,participatory approach to project management and contract compliance to demonstrate benefits of labor standards and Decent Work