Challenges Today

International Instruments for Protection and Promotion of International Labour Standardsin the Era of Globalization

Challenges TodayMission for Trade UnionsAchievement of social inclusion, based on fair, stable, sustainable and predictable development. Whats Needed?To reach as many workers (and their families) as possible and to secure/protect their rights and interests.How?By effectively utilizing all the means available for trade unions to protect and promote workers rights and interests.

Main AssumptionsThe key target of trade union campaigns is Multinational Enterprises (MNEs);There are effective international instruments available for trade unions in their campaigns for workers rights and interests, but they are not fully used;If trade unions use them more effectively & intensively, they can bring about positive changes in the behaviours of MNEs.

Summary of International InstrumentsRegional/Bilateral Economic AgreementNational Labour Relation / Tripartite CommitteesILO MNE DeclarationInternationalNationalPrivatePublicILO F.P.R.W. Declaration

Code of Conducts

Reporting InitiativesLabour LegislationCFAILSUN Global CompactOECD MNE GuidelinesCorporate Social ResponsibilitiesFramework AgreementsPolitical Campaigns/Lobbying

ILO Conventions:Supervisory MechanismFor Ratified ConventionsArticle 22 Report - Review by CEACR/CCACRArticle 24: RepresentationArticle 26: ComplaintFor Non-Ratified ConventionsArticle 19(5-e) ReportFor violations of FOA rightsSpecial procedure through Committee on Freedom of Association (CFA)Annual Review Report on Non-ratified Core StandardsGeneral SurveyILO F.P.R.W. Declaration+

ILO Tripartite Declaration on Principles concerning MNEs (1) Adopted in 1977 by GB (amended in 2000) as a voluntary, promotional instrument to:Regulate conduct of MNEsDefine the terms of MNEs relations with host countries, esp. in labour-related and social issuesAims to:Enhance the positive social and labour effects of the operations of MNEs

ILO MNE Declaration (2):Follow-up ProceduresAn Interpretation procedure adopted by GB in 1980 (revised in 86):provides for the submission of requests for interpretation in cases of dispute on the meaning/application of its provisions.Periodical SurveyThe effect given to the principles of the Declaration is monitored through a periodic survey (7th Survey conducted for 96-99)

ILO MNE Declaration (3):Workers Participation in Follow-upIn the Survey, trade unions can (and should) send their comments to the Government or directly to the ILO concerning the behaviours of MNEs doing business in their countries; In the 7th Survey, it was noted that trade unions did not actively participate.The main point is that if the ILO does not receive comments from workers, it has no choice but to BELIEVE the report by Govts.

OECD Guidelines for MNEs (1)Adopted in 1976, with major review in 2000Guidelines is:a multilaterally endorsed non-binding code of corporate conduct addressed to multinational enterprises (by the Governments);Voluntary principles and standards for responsible business conduct38 countries (30 OECD members + 8 non-members) are adhering to the GuidelinesMajor components: NCP, CIME, and TUAC

OECD Guidelines (2): 2000 ReviewExpanded CoverageAll core standards, environment performance, human rights, corruption and consumer interestsGlobal application, not just in OECD countriesStrengthened National Contact Point (NCPs)are responsible for encouraging observance of the Guidelineshandle enquiries, assist in solving problems, and report and meet annually on national experiencespromote Guidelines for effective implementationNew Actor: NGOs

OECD Guidelines (3): Areas CoveredConcepts and PrinciplesGeneral PoliciesDisclosureEmployment and Industrial RelationsEnvironmentCombating BriberyConsumer InterestsScience and TechnologyCompetitionTaxation

OECD Guidelines (4): ImplementationSpecific instances - a facility that allows interested parties to call a companys alleged non-observance of the Guidelines recommendations to the attention of an NCP;Use of the Guidelines implementation processes by business, trade unions, NGOs and by governments has been increasing;Promotional activities by NCPs:Reflecting the Guidelines in domestic standards. (Australia)National corporate responsibility programme and report. (Finland)Comparison with national law. (New Zealand)Training of entry-level government economists. (Netherlands)National Funds use Guidelines as a benchmark. (Norway)Major international conference on the role of development cooperation agencies in corporate responsibility (Sweden)

OECD Guidelines (5): NCPThe structure of NCPs:21 NCPs are single government departments; 6 NCPs are multiple government departments; 9 NCPs are tripartite; and 2 NCPs are quadripartite. Some 78 specific instances have been filed:Austria (2), Belgium (1), Brazil (1), Canada (4), Chile (1), Czech Republic (5), Denmark (2), Finland (1), France (11), Germany (6), Japan (5), Korea (3), Mexico (1), Netherlands (11), Norway (1), Poland (2), Portugal (1), Spain (1), Sweden (2), Switzerland (2), Turkey (1), UK (3) and US (11).

OECD Guidelines (6): ChallengesParallel legal proceedings;Non adhering countries;Closer link with UN Commission on Human Rights;Business and human rights; andOutsourcing and relocation.

UN Global Compact (1)Initiative by Kofi Annan, launched in 2000;Seeks to advance corporate citizenship so that business can be part of the solutions for a more sustainable and inclusive global economyVoluntary commitment by companies to support 10 Principles in four areas:Human Rights1. Businesses should support and respect the protection of internationally proclaimed human rights. 2. Make sure they are not complicit in human rights abuses.

UN Global Compact (2)- Labour3. Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;4. The elimination of all forms of forced and compulsory labour;5. The effective abolition of child labour; 6. Eliminate discrimination in respect of employment occupation.- Environment7. Business should support a precautionary approach to environmental challenges;8. Undertake initiatives to promote greater environmental responsibility; 9. Encourage the development and diffusion of environmentally friendly technologies.- Anti-Corruption10.The promotion and adoption of initiatives to counter all forms of corruption, including extortion and bribery.

UN Global Compact (3)Not a regulatory instrument it is a voluntary corporate citizenship initiativeA network-driven = governments, companies, civil societies and the UNFacilitation & engagement procedures:Policy dialogues, Learning, Local structures and Projects1890 companies signed upICFTU, UNI, ICEM, TUAC, IMF

Development ofPrivate Voluntary Initiatives (PVI)As response of global community to the growing power of MNEsAlternative Trade OrganizationsSocial Labelling (SL)Codes of Conduct (COC)New Codes of Conduct (New COC)Framework Agreements (FA)Reporting Initiatives (GRI, SA8000, etc)Corporate Social Responsibilities (CSR)1970s1990s

Code of Conduct(old code)Unilateral declaration, mainly for social appeal or marketing purposeCode of conduct for businessconsumer rights, product safety or environmental protectionethical behaviour codes for employeesCode of conduct for international businessILO MNE DeclarationOECD Guidelines for MNEsattempt by UN to set a global codeNote: These are not PVIs!

New Code of ConductFour Major CharacteristicsPurely private, voluntary initiative (PVI)Response to the situation of poor labour standards created by the failure of national governments and of international community;International applicationCross-cutting application to suppliers and subcontractors

Definition of New Code of ConductCommitments voluntarily made by companies, associations or other entities which put forth standards and principles for the conduct of business activities in the marketplace(Workers tool or PR ploy? by Dr. I. Wick)

Number of New Codes246 codes (June 2000 by OECD study)118 by individual companies, 92 by industry and trade associations, 32 by partnerships between stakeholders and 4 by inter-governmental organizations Only 163 mention monitoringOnly 30% mention freedom of association, and only10.1% refer to ILO codes

Why New Codes are important for Trade Unions?New Codes are on labour practiceMost companies adopt COC without involving trade unionsSo, they can be used as an excuse for having no unionGreat potential and also dangerTruly applied, codes may establish ILSs as binding international framework for responsible corporate behaviourSo, unions involvement is vital

Framework AgreementsAn agreement negotiated between an MNE and an international trade union organization (such as an ITS) concerning the international activities (or behaviour)of the companyMain purpose of framework agreements is to establish an ongoing relationship between the MNE and the ITS to frame principles of industrial relations and good labour practices

Major Framework AgreementsIUF - Danone, Accor, Nestle, Del Monte, Chiquita, etc.IFBWW - Ikea, Faber-Castell, Hochtief, Skanska, etc.ICEM - Statoil, Freudenberg, Endesa, Eni, Lukoil, etc.UNI - Telefonica, OTE, Carrefour, H&M, and ISSIMF - Volkswagen, Daimler Chrysler, Bosch, Renault, etc.

Points for Analyses of F.A./COCSubstance (reference to core labor standards)Negotiations with, and participation of, trade unions (and other social actors)Coverage of responsibility (production chains)Independent verification (monitoring/ follow-up)Complaint and appeals (dispute settlement)Incentives (or sanctions)

Policy and Strategy for T.U.Set up institutional mechanisms and capacities to fully utilize all the available international instrumentsRegular reportingComplaints procedures in case of violationMultilateral approaches to problem-solving Importance of International, Regional, and Sub-regional trade union network

Reporting InitiativesGlobal Reporting Initiatives (GRI)SA8000 (by SAI)Ethical Trade Initiatives (ETI)Clean Cloth Campaigns (CCC)Worker Empowerment Consortium (WEC)

Case Study 1In an Export Processing Zone in DREAMLAND, a Japanese electronics company, NIPPON, sacked 10 leaders of trade unions who demanded for a wage negotiation.DREAMLAND is a member of ILO, but has not ratified Convention 87 and 98.The parent company of NIPPON in Japan is organized by NIPPON Workers Union, which is affiliated to JTUC-RENGO. List all the international actions you can/may take.

Case Study 2In a small village of NEVERLAND, a joint-venture between an American Multinational Giant, NIKE, and a local manufacture, was found to be employing 200 children under the age of 14 at their factories. The union has been taking up this matter in their collective bargaining, but the management has ignored their demands. NEVERLAND is a member of ILO, and has ratified Convention 87, 98 and 138.NIKE has committed itself to respect Core Labour Standards through various international instruments.List all the international actions you can/may take.

The EndACTRAV-Turin

A World Bank-sponsored survey looked at corporate use of major standards for corporate responsibility. The survey asked managers of large multinational enterprises which global corporate responsibility instruments were most influential on practice at their companies. Twenty two per cent of the respondents mentioned the Guidelines without prompting. The most-mentioned instruments were ISO 14000, which was cited by 46 per cent of respondents, and the Global Reporting Initiative, with 36 per cent. Thirty-three per cent of the respondents mentioned the UN Global Compact.Non OECD countries adhering to the Guidelines are: Argentina, Brazil, Chile, Estonia, Israel, Latvia, Lithuania and Slovenia.

ILO MNE Declaration- Only set of guidelines of its kind globally agreed by business, labour and governments

Objectives: To encourage the positive contribution which MNEs can make to economic and social progress, andTo minimise and resolve difficulties to which their operations can give rise

ReceivabilityTo date, only 5 cases were decided by GBPure reports of wrongdoings of MNEs are outside the scope of the Procedure

- OECD MNE Guidelines was originally adopted as part of the Declaration on International Investment and Multinational Enterprises

- Aims to encourage the positive contributions that multinational enterprises can make to economic, environmental and social progress and to minimise the difficulties to which their various operations may give rise.

It is the consensus of the member governments of the OECD as to what constitutes responsible behaviour of international business.

To whom do the Guidelines apply?

- The recommendations in the Guidelines are addressed to multinational enterprises operating in or from adhering countries. Governments adhering to the Guidelines encourage the enterprises operating on their territories to observe the Guidelines, wherever they operate, while taking into account the particular circumstances of each host country.- The Guidelines recommendations are also addressed to all the entities within the multinational enterprise - parent companies and/or local entities. Although the Guidelines acknowledge that small- and medium-sized enterprises may not have the same capacities as larger enterprises, governments adhering to the Guidelines nevertheless also encourage them to observe the Guidelines recommendations to the fullestextent possible.- The Guidelines are also not aimed at introducing differences of treatment between multinational and domestic enterprises and, instead, are intended to reflect good practice for all. Accordingly, multinational and domestic enterprises are subject to the same expectations in respect of their conduct wherever the Guidelines are relevant for both.

As of March 2004, the 8 non-member adherents are: Argentina, Brazil, Chile, Estonia, Israel, Latvia,Lithuania and Slovenia.

Multinational and domestic enterprises are subject to the same expectations in respect of their conductwherever the Guidelines are relevant for both.

NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

- NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

- NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

- NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

The Guidelines have now been translated into 28 languages - Arabic, Chinese, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hebrew, Hungarian, Indonesian, Italian, Japanese, Korean, Latvian, Lithuanian, Norwegian, Polish, Portuguese, Slovak, Slovene, Spanish, Swedish, Thai, Turkish and the official languages of Belgium and Switzerland.

- NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

- NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

- NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

The Guidelines have now been translated into 28 languages - Arabic, Chinese, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hebrew, Hungarian, Indonesian, Italian, Japanese, Korean, Latvian, Lithuanian, Norwegian, Polish, Portuguese, Slovak, Slovene, Spanish, Swedish, Thai, Turkish and the official languages of Belgium and Switzerland.

As to the 78 specific instances filed with NCPs, most specific instances concern Chapter IV (Employment and Industrial Relations). However, some deal with other issues such as other human rights, environment, combating corruption and political involvement.

- NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

- NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

- NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

The Guidelines have now been translated into 28 languages - Arabic, Chinese, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hebrew, Hungarian, Indonesian, Italian, Japanese, Korean, Latvian, Lithuanian, Norwegian, Polish, Portuguese, Slovak, Slovene, Spanish, Swedish, Thai, Turkish and the official languages of Belgium and Switzerland.

As to the 78 specific instances filed with NCPs, most specific instances concern Chapter IV (Employment and Industrial Relations). However, some deal with other issues such as other human rights, environment, combating corruption and political involvement.

NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

NCP itself existed even before the 2000 revision. However, there were only a few existed. The review reaffirmed the governments commitment to establish, activate and effectuate NCPs.

NCP must be : Visible, Accessible, Transparent, and Accountable (four basic criteria)

NCPs should inform inwards and outwards investors of the Guidelines!!!

NGO - in most NCPs, NGOs are still outside of the formal framework

Case on Marks and Spencer : ---- Talks began between French and UK NCPs

Still, there are large gaps among the NCPs in terms of the fulfilment of the four basic criteria!!!

In the 1970s concern over the growing power of multinational companies led two international organizations to adopt codes for international business : OECD Guidelines and ILO MNE Declaration -- to protect the sovereignty of countries by defining the responsibilities, including the social responsibilities of international business.

New Code of Conducts are:Responses to negative publicity generated by reports of dangerous working conditions, inhumane working hours, starvation wages, brutality and the widespread use of child labour.Distinction between Unilaterally adopted codes and Negotiated codes

Therefore, workers organizations have to know pros and cons of the new codes. For maximum utilization of the new instruments, trade unions should understand their background, role, limitations, advantages and main features.It is possible, and often is, that a code of conducts is included in a framework agreement