Core Labor Standards and Development: Evaluating the Impact

IMGXYZ777IMGZYX On September 20, 2007, the Carnegie Endowment for International Peace hosted a discussion of the impact of core labor standards on development.  The speakers included Mr. Kari Tapiola, Executive Director for Standards and Fundamental Principles and Rights at Work for the International Labor Organization (ILO); Professor Colin Fenwick, University of Melbourne, Australia, author of an independent evaluation of ILO programs; Mr. Lewis Karesh, Assistant United States Trade Representative for Labor Affairs; and Ms. Ros Harvey, Global Manager of the Better Work Programme of the ILO.  Carnegie Senior Associate Sandra Polaski moderated the event.

Ms. Polaski began the discussion by noting that in recent years there has been a strong convergence within the international community toward recognizing four core labor standards as basic human rights that apply to all workers in all countries, regardless of the level of economic development.  The progress made in instituting these rights in international agreements and institutional policy over the past ten to fifteen years has been quite remarkable. This does not mean that there is no longer any controversy about applying core labor standards in developing countries or linking them to economic policy instruments such as trade agreements or loans from international financial institutions.  However enough experience has accumulated that it is possible to assess how the principles are actually working in practice and how they are affecting development issues.  She then introduced the panelists to address this issue.

Kari Tapiola began by describing the ILO’s Declaration on Fundamental Principles and Rights at Work, adopted in 1998, which identifies the four core rights applicable to all workers: freedom of association and the right to bargain collectively, the elimination of forced labor, the abolition of child labor, and non-discrimination in employment.   He noted that the ILO had also adopted a program to implement the Declaration, focusing not only on normative legislation but also on providing technical cooperation to help developing countries implement the necessary reforms.  The ILO, he said, is no longer simply trying to find out what’s wrong, but is also working to try to help to put it right.  Central to this new imperative is a “tripartite” approach, involving governments, employers’ organizations, and workers’ organizations.  Mr. Tapiola noted that recently there had been some real success in combating child labor and forced labor, however regrettably there had been less progress in ensuring workers’ right to organize and bargain collectively.

Colin Fenwick then presented the results of an independent study he had co-authored assessing the success of the ILO Declaration programs in Brazil, Indonesia, Morocco, and Vietnam.  (Click on the link to the right for the full text of the report.)  Mr. Fenwick found that the projects had achieved measurable successes and resulted in tangible improvements in labor conditions for the impacted workers in these countries.  In Brazil, 17,000 workers were rescued from conditions of forced labor.  In Indonesia, the ILO facilitated the revision of labor laws and provided key training for labor court judges.  The Moroccan ILO project educated employers and workers on a newly enacted labor code and trained labor inspectors, including producing manuals for labor inspection in both French and Arabic.  In Vietnam, the ILO project focused on educating the government, employers, and workers of their roles in a market economy.  Mr. Fenwick cautioned, however, that widespread labor problems remained in these and other developing countries, and that these small, targeted programs – while successful – were limited in what they could achieve.

Next, Lewis Karesh addressed the importance of core labor standards in American trade and development policy.  He pointed out that labor provisions in American trade deals were nothing new, that they have been included in numerous free trade agreements as well as the General System of Preferences, and even date from some of America’s earliest trade agreements in the 19th century.  He asserted that in many developing countries governments welcomed making trade agreements conditional on enhanced labor standards, as this helped build domestic support for sometimes difficult labor reforms.  Mr. Karesh also noted that the United States was by no means the only country to stress the importance of core labor standards, as several other countries – including Canada, the EU, and Chile – also include labor provisions in trade agreements.

Ros Harvey provided an overview of the ILO’s highly successful Better Factories Cambodia program, and addressed how its lessons could be applied to other countries.  The Better Factories program provided an incentive for Cambodian apparel manufacturers to improve working conditions and respect for workers’ rights by offering increases in access to the US market in return for demonstrated improvements.  To facilitate this process, the ILO implemented a strategy consisting of monitoring labor standards in factories, reporting the results in very transparent and detailed public reports, presenting suggestions for addressing problems, and providing capacity building to help implement solutions.  The new Better Work Programme, co-sponsored by the ILO and the International Finance Corporation (the private sector lending arm of the World Bank) and headed by Ms. Harvey, is an attempt to apply the Better Factories Cambodia framework to a greater number of workers in numerous sectors and countries.  The program, still in its infancy, is currently in negotiations with stakeholders in Jordan, Lesotho, and Vietnam; Ms. Harvey expressed hope that all three of these projects would go ahead shortly, and would be as successful as Better Factories Cambodia had been.

Sandra Polaski opened the question period by asking the panelists what they thought were the most important next steps for the international community toward improving workers’ rights.  Mr. Tapiola commented that there was a need to deepen and expand the decent work agenda, including a stronger focus on creating new jobs; he noted, however, that there was no effective way to legislate job creation.  Mr. Karesh underlined the importance of building support for core labor standards within countries that have not yet shown much support for linking workers’ rights with trade.  Mr. Fenwick said one of the most important issues facing workers today was trafficking in people, and expressed the need for international cooperation in addressing this challenge.  Ms. Harvey stated that the greatest need today was to move beyond very small, targeted projects to find projects which were scalable (able to include a large number of workers) and sustainable for the long term.

In response to questions from the audience, the panelists expressed the need for national governments and international institutions (such as the ILO, the World Bank, and others) to work together to promote labor standards; the importance of including the informal economy in labor standards projects, a proposition which they agreed is difficult but possible; and the challenge of promoting core labor standards – particularly the right to organize and bargain collectively – in China, due to political constraints.