International Labour Office Multinational Enterprises Programme TRIPARTITE DECLARATION OF PRINCIPLES CONCERNING MULTINATIONAL ENTERPRISES AND SOCIAL POLICY

International Labour OfficeMultinational Enterprises

Programme

TRIPARTITE DECLARATION

OF PRINCIPLES CONCERNING MULTINATIONAL ENTERPRISES

AND SOCIAL POLICY


Programme

MNE DeclarationAdded Value

Universal reference point for social responsibility agreed by governments, business and labour

balances roles and responsibilities of governments, business and labour

applies equally across countries of operation


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MNE Declaration

Offers Business – Multinational and local:

ongoing and productive partnerships in global markets

risk management

Unions: fundamental rights at work skills training for employability good working conditions / health & safety sound industrial relations

Governments: investment flows partnerships to build decent work and reduce

poverty


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MNE Declaration

Issues

Background and aimGeneral policiesEmployment

promotion, equality, securityTrainingConditions of work and life

wages and benefits, child labour, safety and health

Industrial relations freedom of association and right to

collective bargaining


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MNE Declaration Background and

aim

Two interdependent aims

encourage MNEs’ positive contributions to economic and social progress

minimize and resolve difficulties arising from MNE operations


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MNE Declaration General policies

Government, business and labour, through consultations and good practice:

obey national laws

respect international standards United Nations human rights instruments fundamental principles and rights at work

support development priorities


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MNE Declaration Employment

promote full and productive employment in MNEs, directly and through linkages

pursue equality of opportunity and treatment

enhance employment security in set-up and changes of MNE operations


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MNE Declaration Skills training

develop national policies for vocational training and guidance

ensure training meets needs of MNEs and host country labour market

encourage skills development for employability


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MNE Declaration Conditions of work &

life

wages, benefits and conditions of work in MNEs as favourable as those of comparable employers if no comparable employers,

best possible conditions in MNEs basic amenities of a good standard

for workers help abolish child labour ensure highest standards of safety

and health at work


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MNE Declaration Industrial relations

standards of industrial relations in MNEs as favourable as those of comparable employers

respect freedom of association and the right to organize

recognize and facilitate collective bargaining

systems for consultations - not a substitute for collective bargaining

processes to examine individual and joint grievances and voluntary conciliation machinery to prevent and settle disputes


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MNE Declaration

National, regional and sectoral initiatives

building tripartite partnerships

stimulating consultations and coordinated action among government, business and labour

influencing government action: FDI and employment policies

helping collective bargaining agreements

providing input at regional levels


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MNE Declaration Principles in practice

Building partnerships: Brazil

National Accord for Accountability: Benzene Accord

preventing occupational exposure to benzene

shared responsibilities by MNEs, chemical industry trade unions and government

at plant level: workers monitor and enforce the agreement

at national level, a tripartite commission: oversees developments, monitors compliance

and promotes studies supplements laws and regulations provides for alternative control measures issues certificates for the controlled use of

benzene


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Building partnerships : closure of KEM gold mine in

Indonesia

poor remote rural area with food insecurity: miners wages help support 28,000 villagers

before closing operations, MNE consulted miners: 25% wished to become farmers

MNE’s goal: to work with local community to offer sustainable economic occupation after closure

agriculture retraining programme as part of Government regional development plan run in cooperation with MNE


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MNE Declaration Principles in practice Stimulating social

consultations: Philippines

Memorandum of Social Understanding & Plan of Action

adopted by Governments, business and workers

framework of objectives guided by the MNE Declaration

key roles of each partner in coordinated action to promote employment, security, training, working conditions and sound industrial relations


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MNE DeclarationNational, regional and sectoral

initiatives Influencing government

actionMNE Declaration guides and informs government strategy concerning labour and employment in :

foreign direct investment (FDI) activities reducing the gap between local

enterprises and MNEs concerning labour standards

mergers and acquisitions (M&As), privatization, and other major enterprise restructuring

export processing zones and other investment incentives


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Influencing government action: Ireland

Government strategy to attract foreign-owned MNEs, including favourable tax treatment

Tripartite “Partnership 2000 for inclusion, employment and competitiveness”: take advantage of the potential offered by

MNEs build and strengthen local industry improve linkages between multinational

and national enterprises Results:

increased employment opportunities improved living standards of workers Improved MNE resources for national social

services


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Helping collective bargaining: Argentina &

BrazilCommon approach among Volkswagen affiliates and trade unions in Argentina and Brazil:exchange informationstrengthen productivity resolve disputes (individual &

collective) respect workers’ right to be

represented and to organize include trade unions in planning skills

developmentcontinually improve the contract

through social dialogue in MERCOSUR


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Providing input at regional levels: a Southern African

experience The “Maputo Declaration” :

adopted 1999 by worker representatives in the textile, clothing, leather and footwear industry from nine SADC member countries

calls for: respect and promotion of core labour standards

endorsement and implementation of the MNE Declaration and the 1998 ILO Declaration on Fundamental Principles and Rights at Work

encourages regional collective bargaining agreements


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MNE Declaration

Corporate Social Responsibility

inspiring company policies and programmes on a day-to-day basis

offering benchmarks for corporate performance

providing baselines for framework agreements

MNE Declaration Corporate Social Responsibility

Inspiring company policies1998 ILO Study Codes of conduct

Issues selecteda. Health and safety 75%b. Employment discrimination 66%c. Child labour 50%d. Wage levels 40%e. Forced labour 25%f. Freedom of association 15%

Sources of reference Self-definition 55% National law 45% International labour standards

33%Conclusion:

unpredictable correlation with MNE Declaration benchmarks

a b c d e f0

10

20

30

40

50

60

70

80


Offering benchmarks for corporate performance

Elements for putting principles into practice: Equality of employment opportunity

Quantitative workforce ratios by gender, ethnicity, religion, in

percentage of population ratiosQualitative penalties for violation of discrimination/equality

laws and regulations recruitment based on skills Systems equal opportunity policy training systems on non-discrimination grievance procedure to address

discrimination/harassment


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MNE Declaration Corporate Social

Responsibility Providing baselines for framework

agreements16 agreements between MNEs and Global Union Federations for worldwide operations:

Building and wood working: IKEA,

Skanska, Hochtief, Faber Castel, Ballast Nedam

Food, agriculture, hotel: Danone, ACCOR, Chiquita, Fonterra

Chemistry, energy and mining: Statoil, Endesa, Freudenberg

Metallurgy: Merloni elettrodomestici, VolksWagen

Telecommunications: Telefónica Retail: Carrefour


Providing baselines for framework agreements

Percentage of 16 Framework agreements including references to international labour standards:

1. Freedom of association and collective bargaining 100%

2. Employment discrimination 88%

3. Child labour 81% 4. Forced labour 81%5. Safety & health 50% 6. Minimum wages 44%

Conclusion: higher correlation with MNE Declaration benchmarks

0%

10%

20%

30%

40%

50%60%

70%

80%

90%

100%

1 2 3 4 5 6

MNE Declaration Other international initiatives

The OECD Guidelines on Multinational Enterprises

OECD Guidelines Countries of operation

of OECD companies

OECD governments’ supervision

Service by National Contact Points with or without business and labour inputs

MNE Declaration All ILO member

states

Tripartite oversight

Assistance by ILO offices on a tripartite basis

MNE Declaration Other international initiatives

UN Global CompactUN Global Compact Labour principles

freedom of association and collective bargaining

elimination of forced labour effective abolition of child

labour elimination of employment

discrimination

built-in dialogue and partnerships

UN agencies, business, labour and NGOs oversight

MNE Declaration Added guidance on

ways to implement labour principles by the four parties

built-in dialogue and partnerships, includes reporting and dispute solution systems

Tripartite oversight


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MNE DeclarationILO products and services

Follow-up

Tripartite surveys to assess progress

Interpretation procedure to address conflicts

Thematic, sectoral, country or regional studies

Dialogue and advisory activities at national and regional level


Assessing progress: follow-up surveys

Successes and challenges in realizing MNE Declaration goals

Joint or separate views of home and host country governments and of workers’ and employers’ organizations across ILO membership

Conclusions and recommendations decided by global representatives of government, labour and business

Results:examples of good practice insights into new trendspractical experiences

MNE Declaration ILO products and services

Assessing progress: 1996-1999 survey

Experiences of governments, business and labour in 100 countries:

positive and adverse effects of the use of technology by MNEs and of their linkages with local enterprises

MNE contributions to social and business partnerships that develop skills to sustain employment in changing markets

regional ripple effects of good MNE practices in health and safety

benefits and difficulties of promoting security of employment in the context of flexibility, restructuring and out-sourcing

MNE and government policy and practices in export processing zones and other investment incentives

employment effects of privatization and mergers and acquisitions.


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Addressing conflicts: interpretation procedure

Requests for interpretation of the MNE Declaration: in specific cases of actual dispute over the

meaning of the principles examined and answered by the ILO

Governing Body

to date, interpretations have been given in four cases covering: Notice before change of operations Consultations on decisions with major

employment effects Authority of management representatives

to take decisions during negotiations


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MNE Declaration

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Documents

International Labour Office Multinational Enterprises Programme TRIPARTITE DECLARATION OF PRINCIPLES CONCERNING MULTINATIONAL ENTERPRISES AND SOCIAL POLICY