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

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

2. Globalization?Participants views…

3. Why Globalisation? • 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; • Economic reforms, free trade & Globalization!

4. Share in World Income/GDP Share in World Trade Share in FDI Share in Portfolio Investments 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) HIC (76.6), MIC (12.5), LIC (1.1), China & India (9.8) Global Background (2002, in %) Source: ILR, 2004/1-2, Vol 143, ILO, Geneva

5. What is Globalization Promoting? • 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

6. Implications of New Policies • 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; • The policies that helped developed countries to develop are now considered trade distorting and hence to be done away.

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

8. Changing World of Work & Management Policies Globalization means  more competition  more pressure to reduce costs, increase productivity • 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;

9. Effects on Labour • 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;

10. Size of the unprotected work force 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

11. Effects on Trade UnionsParticipants experiences

12. Trade Union Densities (in %) Source: SAK, quoting OECD Employment Outlook, July 2004, 30/11/2006

13. Trade Union Densities (in %)Asia-pacific Source: Labour & Social Trends in Asia-Pacific, 2006 - ILO

14. 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. • Respect for basic International Labour Standards for promotion of Decent Work; • Representation & Participation of TUs

15. 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

16. How is DW to be achieved? • 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;

17. 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

18. 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 &includes promotion of FoA & Coll. Barg. rights

19. 7 Oct 2008 World Day for Decent Work Solidarity Rights at work Ending Poverty and Inequality

20. Trade Union responses to the challenges posed by Globalization • 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. • 4 new regional organizations (in Africa, Asia, Latin America, & Europe/Central Asia) have also been created

21. Trade Union Responses • 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) • Build alliances with other social partners on mutually agreed agenda • Participants views on national responses?

22. 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)?

23. Negotiating Change… • What do Employers want? • What is important to TUs? • While the ends may remain the same, the means can change?

24. Negotiating change at national level … • Ensure Right to Organize & Right to Collective Bargaining! • 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.

25. 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

26. 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.

27. Getting back to basics Trade unions must strengthen their organizing and bargaining power. HOW? Challenge 1: Creating an“Enabling Environment” for Trade UnionActivities Challenge 2: Building Capacity ofUnions in Organizingand CollectiveBargaining

28. Group Work • 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?