Beyond Trafficking and Slavery

Supply chains roundtable: Neha Misra

Neha Misra
26 June 2016

Question 1 – do we need a binding international convention on corporate responsibility for labor standards in global supply chains?

The Solidarity Center works directly with workers on the ground in 60 countries. We share the view of the ILO Workers Committee that this year’s discussion on ‘decent work in global supply chains’ needs to lead to an eventual binding instrument on supply chain governance, decent work, and the fundamental principles and rights at work for all workers, including migrant workers, in global value chains. We have seen all too clearly how the lack of legal protections for workers and built-in impunity for corporations with complicated supply chains lead to exploitive workplaces, dangerous working conditions, denial of democratic rights and entrenched discrimination. That is why we wanted this year’s ILC discussion to begin to define the scope of an instrument that puts workers at the centre of any solution to rectify these wrongs. 

Question 2 – what should global supply chain governance look like?

Effective global supply chain governance would hold multinational corporations and local employers accountable for their treatment of workers, especially the most vulnerable among them, throughout the global and local supply chain. Governments, the private sector, and civil society can and should prioritise changing the structures, systems, and institutions of corporate buying/supply chains to promote worker rights. Governance will only be sustainable if it is based on principles of decent work, with governments ensuring that all companies and employers under their jurisdiction respect fundamental worker rights, specifically freedom of association, the elimination of forced and child labour, and an end to discrimination.

A credible and successful governance system would ensure that ALL workers (including migrant and informal economy workers) are covered by labour and other legal protections. This means the creation of strong labour inspection regimes and worker empowerment to adequately monitor and enforce laws.

Governments should have a responsibility to not adopt anti-worker practices on behalf of business. Moreover, governments, as buyers themselves, must take the lead in making sure that their supply chains respect worker rights, as well as regulate the extraterritorial conduct of companies, incorporated, registered, or doing substantial business within their borders. The US government, which is the world’s largest buyer, has begun to take measures to eliminate some of the worst worker rights abuses in its supply chains. Executive Order 13627 requires government contractors to eliminate recruitment fees, document retention, and other recruitment abuses. The US government also recently amended its customs law to eliminate a loophole in the enforcement of the prohibition of the importation of goods made with forced, child, or prison labour.

Civil society organisations, such as independent trade unions and worker rights organisations, should be central to good supply chain governance. This would better ensure that working women and men have a voice and can enjoy dignity on the job, as well as solve abuses such as unsafe working conditions, wage theft, and gender-based violence at work. Civil society can influence lawmakers and corporations, demanding that all workers, including migrant workers, have greater freedom of association and the ability to bargain collectively along supply chains.

At the Solidarity Center, we have two decades of experience supporting working people who bear the brunt of corporate irresponsibility and supply chain exploitation – from Central American public-sector workers murdered for organising a union to Bangladeshi garment workers who died or suffered life-altering injuries when the factory ultimately collapsed on them.

We have seen firsthand what is possible when workers sit at the centre of workplace and supply chain monitoring. At the world’s largest rubber plantation in Liberia, for example, workers went on wildcat strikes to demand an independent union and used collective bargaining to end forced labour, child labour, and poverty wages on the plantation. After years of exploitation, Honduran garment workers sewing for a large US retailer gained respect in the workplace and fair wages by demanding collective bargaining through their union. And nine Burmese men held for years on a Thai fishing boat that supplied the global pet food industry are finally able to seek justice in Thai courts due to the intervention of worker rights activists and Solidarity Center lawyers.

Government, corporate, and employer accountability initiatives that do not promote or include provisions regarding freedom of association, disclosure and transparency in production, and monitoring by independent trade unions and/or legitimate independent worker rights organisations will continue to see gross violations of worker rights all along their supply chains. Therefore, supply chain governance must also address legal accountability and access to justice for workers. The simplest and most effective way to do this would be to impose a strict liability policy for buyers and their suppliers all along their supply chain.

Question 3 – how can we promote business accountability for labour standards in supply chains?

Businesses, employers, and multinational corporations need to take responsibility for their entire supply chains. According to a recent report by the AFL-CIO, Solidarity Center, and Rutgers University, “The fragmented structure of global supply chains means that lead companies almost never directly hire the workers who actually make products, and usually are not held liable for labour practices in the production process, despite having a huge amount of influence on pricing and conditions. This separation makes enforcing labour rights particularly challenging”.

We encourage buyers to have long-term relationships with suppliers, and believe that they have an obligation to ensure that suppliers all along their supply chains comply with core labour standards. Buyers should stay with a factory when there are problems and remedy them, providing compensation to aggrieved workers. Businesses, including local employers and multinational corporations, should also be required to map and publicly disclose their entire supply chain.

A thriving industry centred on the economic coercion of migrant workers exists in the form of labour recruitment and placement services across migration corridors as well as in countries of origin, transit, and destination. The labour recruitment industry is an unregulated supply chain actor that creates precariousness in the workplace, distances employers from their workforce, and leaves migrant workers vulnerable to the worst forms of exploitation.

Migrant workers, both undocumented and guest workers, are overly represented in informal and subcontracted employment. Often undocumented workers are employed through third-party staffing arrangements to obscure legal responsibility for the employment relationship. And the high fees charged to migrant workers during the recruitment process often leaves them vulnerable to debt bondage. As migrant workers are increasingly the backbone of global supply chains, businesses must have policies to ensure protection and full worker rights for them.

In addition, we need clear and effective monitoring and enforcement of supply chains to ensure that women workers are treated fairly. A recent International Labour Organisation study found that, on average, women earn 10-30% less than men through paid employment. Throughout supply chains, women are cheated out of wages and jobs through discriminatory practices, and subjected to harassment and violence when the corporate culture lacks accountability and transparency. The particular gendered impacts for women workers in supply chains should be remedied by unions, businesses, and governments.

Question 4 – in the absence of extra-territorial legislation to ensure and enforce business accountability, how can workers best be protected in international supply chains?

A hundred years of history shows that the only effective way to protect worker rights and effectively monitor workplaces is for workers to do it themselves. Independent trade unions are able to ensure that workers can raise concerns regarding working conditions or violations of human rights without fear of retaliation by employers. In non-unionised workforces, groups such as the Coalition of Immokalee Workers (CIW) have shown that worker agency can improve conditions and wages where it is most needed. Employers and governments cannot replace the independent voice of workers. Employers and governments should, however, ensure that there is space for workers to exercise their freedom of association.

Social auditing, while popular, is not an effective means of monitoring supply chains. The September 2012 Ali Enterprises garment factory fire in Pakistan is a prime example. Nearly 300 workers died in the fire, despite the fact that the factory was certified.

In the absence of legislation, collective bargaining agreements (which, unlike codes of conduct, are binding legal contracts) and other mechanisms like international framework agreements and jobbers agreements are powerful tools for business accountability. With collective bargaining agreements, workers can:

• define and maintain the needed change in supply chains

• lead independent monitoring of workplaces

• hold multinational corporations accountable

• educate consumers about the structure of supply chains and their role in supporting workers in changing them

Corporations can take responsibility for their global supply chains by:

• demanding that their suppliers function in ways that advance worker rights, pay a living wage, and provide safe working conditions

• including workers in the process of creating standards in the supply chain, supporting worker monitoring, and recognising the workers’ union

• being transparent in efforts to trace their suppliers and disclose their entire supply chain

Consumers have a choice in the products they purchase. Consumers can support changing the structure of supply chains and holding businesses accountable by:

• becoming more educated about how the products they buy are manufactured

• purchasing products that are produced only by companies that respect worker rights and have their suppliers aligned with that practice

Question 5 – what, more generally, are the benefits and drawbacks of global supply chains as a 'model' for production and development?

While global supply chains may offer development opportunities in poorer countries they also allow for a race to the bottom. On top of that, they limit the liability for multinational corporations seeking both cheap labour and loosely regulated business environments in which to produce their goods. Global corporations have gone from being factory owners to buyers, allowing them to claim less responsibility for abuses in their supply chain.

Workers and the unions and organisations representing them are finding ways, however, to use the reliance on global supply chains by multinational corporations to promote worker rights. From framework agreements to the Bangladesh Accord, these groups are educating consumers and leveraging brand recognition to push for binding agreements to improve the treatment of and respect for workers around the world.

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