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In today’s global economy, corporations coordinate complex chains of suppliers across several different countries. Growing competition and constant downward pressures on prices encourage suppliers to squeeze workers, who are made to work for long hours, for very little pay, and often in precarious and dangerous conditions. The most vulnerable links, the workers at the end of global supply chains, are too often subjected to severe labour exploitation, including human rights violations.
The current discussions on decent work in global supply chains at the ILO’s ILC represent an exceptional opportunity for governments, workers and employers to jointly address what has become one of the key problems of our time.
This year’s International Labour Conference (ILC) has turned its attention to the crucial topic of decent work in global supply chains, recognising the potential of global supply chains for the creation of employment but also the dangers posed by this new global production model and its significant impact on the rights of workers.
The International Labour Organisation (ILO) has a tripartite structure: representatives of governments, employers, and unions all participate in the production and establishment of its standards. As such, the current discussions on decent work in global supply chains at the ILO’s ILC represent an exceptional opportunity for governments, workers and employers to jointly address what has become one of the key problems of our time.
The outcome of these discussions will have important implications for the future of decent work in an increasingly globalised world. As may be expected, positions on this topic are highly polarised, with workers pushing for greater accountability on the part of multinational corporations, and employers resisting workers’ demands for increased transparency and responsibility.
What’s happened so far?
The ILC takes place over two weeks, with most of the first week (30 May-3 June) dedicated to plenary meetings and discussions within committees, including a specialised committee on decent work in global supply chains. A selected group within the committee has then worked over this past weekend to produce initial draft conclusions for the committee. Over the coming week, delegates from the workers’, employers’ and governments’ groups will work to introduce amendments and negotiate the final conclusions to be adopted by the ILO.
As expected, discussions in the first week centred on the worker’s calls for an ILO convention on decent work in global supply chains. Worker organisations are pushing for a decision by the ILO to work towards a new instrument establishing the legal accountability of corporates, and requiring states to pass laws and regulations that regulate the conduct of corporations under their jurisdiction, wherever the alleged abuses may occur.
Under the new binding convention that they propose (and that is supported by much of civil society and most human rights advocates), governments would require companies to put in place human rights safeguards, and to conduct ‘due diligence’ throughout their supply chains. This convention would therefore give life to some of the key principles of the United Nations Guiding Principles on Business and Human Rights (UNGPs), a non-binding international standard that has been widely supported by the employer’s group at the ILO.
Workers argue that while the UNGPs are a key step towards greater responsibility on the part of corporates, voluntary initiatives have largely failed to deliver the changes needed in global supply chains, which is precisely why such binding rules are necessary to establish genuine transnational corporate accountability.
Employers contend that multinationals do not control their suppliers, and as such should not be held responsible for the enforcement of labour rights in the supply chain.
Employers, however, argue that there is no need for new rules, stating that “there is no new regulatory gap that needs to be bridged at the international level because of cross-border supply chains”. Employers have further contended that multinational corporations do not control their suppliers, and as such should not be held responsible for the enforcement of labour rights in the supply chain. In particular, employers have rejected worker calls for mandatory due diligence and legal accountability on the part of lead firms for the abuses committed by their subcontractors. Employers have called, instead, for national governments to exercise greater control over the activities of suppliers through improved labour inspection and the effective enforcement of legal obligations at the local level.
The alternative view put on behalf of workers is that it is the responsibility of companies to monitor the structures they have created themselves, and to remedy any harm caused by the abuse of workers’ human rights in their supply chains. It is a reality that in their search for cheaper prices, and with fewer barriers to trade, corporations are choosing to operate in, or source from, countries with low labour costs and poor workers’ rights records. Driven by the same profit maximisation logic, corporates push suppliers to produce at lower prices and with maximum flexibility, fully aware that suppliers might ‘cut corners’ to compete for their business. Those cuts may involve violating workers’ basic human rights. Putting the onus solely on local governments to regulate the actions of suppliers exempts buyers of responsibility and ignores the structural drivers of exploitation.
Labour exploitation in supply chains is a global problem, and as such it requires a global response. Within the tripartite structure of the ILO, and between these two positions, sit the government delegates, who will decide whether the proposed convention falls at the first hurdle or has a chance to develop. Early indications from the first week of the ILC are that there is some support for a binding agreement among European and other governments. As the ILC enters its second week, delegates will be working on the negotiation and adoption of a text that will set the basis for the work of the ILO on supply chains in the years to come. With a clear divide between labour and employers, close attention will now be focussed on the position that governments will take on this key question. From the perspective of worker rights, it is all to play for.