Globalization, Labour Relations Decent Work Challenges for Trade

							Globalization, Labour Relations & Decent Work: Challenges for Trade Unions
Arun Kumar

Globalization?
Participants views…

Why Globalisation?
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Capital needs markets…new markets for profits; for natural resources Developing countries need to grow, need capital, access to new technology, goods & services; Investors need free trade, minimum or no regulations on capital & safe guarding of their investments;

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 Economic reforms, free trade & Globalization!

Global Background (2002, in %)
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Share in World Income/GDP Share in World Trade Share in FDI

HIC (80.5), MIC (11.5), LIC (2), China & India (6) HIC (72.9), MIC (15.6), LIC (2.7), China & India (8.7) HIC (76.6), MIC (12.5), LIC (1.1), China & India (9.8)

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Share in Portfolio HIC (76.6), MIC (12.5), LIC (1.1), Investments China & India (9.8)
Source: ILR, 2004/1-2, Vol 143, ILO, Geneva

What is Globalization Promoting?
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Basic thinking: Supremacy of markets, Government - a problem! One size fits all kind of policies: Open markets for trade, investment & capital flows, seek FDI rather than foreign aid, no performance requirements on FDI, cut govt deficit, privatize, deregulate & reduce role of govt in economic activities, and so on In the labour markets – employment flexibility

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Implications of New Policies
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Shift from development cooperation to free trade; Free Trade means  More competition between Unequals; More freedom to Capital; Adverse impact on devt & employment – many developing countries may remain providers of natural resources & low value products;

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The policies that helped developed countries to develop are now considered trade distorting and hence to be done away.

Effects in labour markets – on labour, trade unions and employment

Changing World of Work & Management Policies
Globalization means  more competition  more pressure to reduce costs, increase productivity
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Downsize, reduce regular workforce, preference for casual-contract labour, increase workloads Weaken TUs thru new HR policies such as Create a committed workforce through employee welfare measures Encourage employees to directly come to the Managers rather than go to the Union in case of problems Transfer jobs from bargainable to non-bargainable Job insecurity;

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Effects on Labour
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Deterioration of labour standards & social protection provisions; decline in social dialogue – consultations & tripartite machinery Weakening of public services (transport, health care systems, basic education, etc as public expenditure & role of Govt in these sectors declines); Growing informal economy – rural-urban migration as agriculture becomes non-viable for small farmers – casual insecure jobs in urban areas with no social protection;

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Size of the unprotected work force
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For example (in 2005): Bangladesh: 78% of total employment (37.2 m) India: 92% of total employment (362 m) – (almost 46% of employment in the organized sector is informal) Nepal (98/99 data): 73% of all employment Pakistan: abt 73% of non-agricultural employment (20 m) Sri Lanka: about 62% of the total employment (4.4 m) Indonesia: over 78% Philippines: over 71%
Note: Rough estimates, collated from different sources

Effects on Trade Unions
Participants experiences

Trade Union Densities (in %)
Country
Sweden Belgium UK France Italy USA Japan

2004
79-81 56 29-31 8-10 33-35 12-13 19.7%

Source: SAK, quoting OECD Employment Outlook, July 2004, 30/11/2006

Trade Union Densities (in %)
Asia-pacific
Country
China

2002
17-18

Korea
Malaysia Philippines Singapore India Pakistan Sri Lanka
Source: Labour & Social Trends in Asia-Pacific, 2006 - ILO

6-7
7-8 11-12 18-19 1.6 (2000) 0.6 (2000) 7.5

So, what are TUs saying?
Answer does not lie in Protectionism
 Justice, Equity & Democracy in the new global order;  Role of State & public regulation of business and

international trade;

 Review Free Trade – to re-focus on the objectives of

Devt, Employment & Poverty reduction – multilateralism rather than bilateralism.
promotion of Decent Work;

 Respect for basic International Labour Standards for

 Representation & Participation of TUs

ILO’s Response – Decent Work For All!
All those who work, have rights at work!

What is Decent Work? Work that is productive, gives fair income, security in the workplace & social protection for the family, equal opportunities & treatment, better prospects for - personal devt & social integration, freedom to organize & participate in decision making

How is DW to be achieved?
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Creating productive jobs – thru sustainable economic & social devt; Guaranteeing fundamental rights at work to all workers; Providing basic social protection for all – a minimum protection against low or declining living standards; Promoting social dialogue for policy formulation & conflict resolution;

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Fundamental Principles and Rights at Work (1998)
• Freedom of association & recognition of the right to collective bargaining • No forced/compulsory labour • No child labour • Elimination of discrimination in employment and occupation …. a global social floor

TUs support Decent Work
TUs support the integrated approach of ILO to address the social impacts of globalization; Because the concept of Decent Work • Focuses on core rights, addresses all workers, in all economic sectors (formal, informal); • Is participatory, promotes Social Dialogue & seeks to involve all social partners • Is Dynamic – progresses as the economy changes

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includes promotion of FoA & Coll. Barg. rights

7 Oct 2008

World Day for Decent Work

Ending Poverty and Inequality

Trade Union responses to the challenges posed by Globalization
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Mergers of trade unions – GUFs(EI, BWI, IAEA, ICEM, IFJ, IMF, ITF, ITGLWF, IUF, PSI, UNI); ITUC – merger of ICFTU, WCL & some other unions – on 1 Nov 2006, Vienna;
ITUC represents 311 affiliated national trade union centers of 155 countries & territories representing some 168 million members.

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4 new regional organizations (in Africa, Asia, Latin America, & Europe/Central Asia) have also been created

Trade Union Responses
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Core Labor Standards (CLS) campaign aimed at financial IFC, World Bank, IMF, WTO, EU and other multilateral institutions; Development cooperation programs to strengthen worker/union rights & organizing activities (initiatives in informal sector, including for migrants); International Framework Agreements to promote MNCs’ commitment to basic labor conditions, including workers’ right to organize & bargain collectively (55 agreements in place covering approx. 5 million workers worldwide)

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Build alliances with other social partners on mutually agreed agenda
Participants views on national responses?

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Challenges for the international trade union movement
 How to ensure workers’ rights in global
economy?  How to influence employment policies?  How to balance demands for increased employment flexibility with workers rights to social protection?  How to organize in globalizing economy and in new work place environment (given employment flexibility, informal economy and increasing mobility of capital)?

Negotiating Change…
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What do Employers want?

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What is important to TUs?
While the ends may remain the same, the means can change?

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Negotiating change at national level …
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Ensure Right to Organize Collective Bargaining!

&

Right

to

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Prevent further divisions of workers in the labour market –put all workers in one boat. Set nationwide floor labour standards –that apply to all workers & employers (de-link labour standards from permanency of employment); Roof to be attained thru Collective Bargaining – the right to which should be ensured.

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Negotiating Change…
What is the floor that employers should respect?
 Freedom of Association –the right to form unions,

the right to recognition

 Right to Collective Bargaining  Basic social security contribution  Access to skills training  No discrimination, No child labour

Why Labour Standards?
Labour Standards are not just a question of workers rights BUT are also means to promote sustainable economic growth! Labour standards create conditions for growth of domestic markets since they enable sharing in gains of growth & spread of purchasing powers – this makes domestic economic growth more sustainable.

Getting back to basics
Trade unions must strengthen their organizing and bargaining power.

HOW?

Challenge 1: Creating an “Enabling Environment” for Trade Union Activities

Challenge 2: Building Capacity of Unions in Organizing and Collective Bargaining

Group Work
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List the major changes that have affected (positively or negatively) the employment, labour & Trade Unions. What actions has your trade union taken or can take to meet challenges of Globalization & free trade? What changes are being proposed by Govts? Employers? What are the priorities of Trade Unions in Asian region?

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