TUAC Consultations with the CIME on the
Review of the OECD Guidelines for Multinational Enterprises
Paris, 17-18 February 2000
Summary Report by the TUAC Secretariat of
Consultations and Associated Meetings
Overview of developments
A TUAC delegation participated along with BIAC and NGOs in a 20-21 February
2000 consultation with the CIME on the Review of the OECD Guidelines for
Multinational Enterprises. The consultations were preceded by a preparatory
meeting of the trade union participants.
At the TUAC pre-meeting, and following a discussion where various views
were expressed it was decided to press more the need for textual revisions,
while maintaining the pressure for strengthened implementation procedures.
Discussions at the consultations around the implementation procedures
concentrated on national-level initiatives through National Contact Points
(NCPs). For the first time since the beginning of the Review some governments
were more willing to enter into a substantive discussion on strengthened
implementation procedures, as was BIAC (with some differences among delegates).
BIAC requested an informal side meeting at one point for a discussion on
textual amendments, in particular to the Employment Chapter. It was agreed
that contacts would be continued beyond the consultations. A bilateral
discussion was also held between the TUAC Secretariat and BIAC representatives
on implementation procedures, where BIAC were willing to discuss NCP reports
and recommendations on cases. Their strong opposition to naming companies
A further Hague informal meeting will be held on 20-22 March 2000. In
addition to limited delegations from TUAC/BIAC/NGOs a small number of governments
will participate. The NCP paper will be revised for discussion at that
meeting, as will a new paper setting out options for CIME reforms.
Formal consultations will then be held on Friday 14 April, to be preceded
by a preparatory meeting on 13 April, at which the Chair of the Working
Party will meet TUAC informally. Further formal and informal consultations
have yet to be arranged.
TUAC preparatory meeting
Annex one lists those affiliates attending the 19 February preparatory
meeting. Agenda items included an oral report of the 24-25 January 2000
informal Hague meeting; oral updates of national level discussions; and
preparations for the consultations, including implementation procedures
and textual revisions.
As regards national-level discussions, LO Norway had met with the relevant
State Secretary; the AFL-CIO had met with the Under Secretary of State,
and was planning a further meeting. The LO and TCO Sweden had met with
the political advisor to the Minister in charge of the Guidelines Review.
A DGB Executive Board member was to meet with the Minister of Economy,
and the Labour Ministry had been urged to engage in the debate. It was
reported that the CLC had been in contact with the Canadian Trade Minister,
and that the TUC was to meet with the Secretary of State for Trade and
Industry the following week. In Italy the responsibility for the Review
had passed from the Treasury to the Ministry of Foreign Affairs, and the
unions were to follow that up. These meetings were over and above meetings
The meetings had succeeded in raising awareness, especially on the trade
union views on the Review among those Ministers who previously had not
been fully informed of developments. Key TUAC affiliates expected the outcome
of the meetings to influence NCP positions at future Working Party discussions.
A full discussion took place on the relative weight that the trade union
campaign on the Guidelines should give to textual revisions and implementation
procedures. It was agreed that greater emphasis should be given to securing
textual revisions more positive to labour, while maintaining the emphasis
on implementation procedures.
CIME consultations with TUAC/BIAC/NGOs
The agenda focussed on the NCP aspect of implementation, using as a
basis for discussion the OECD secretariat paper, “Implementation of the
Guidelines for Multinational Enterprises and National Contact Points”;
with textual revisions being discussed during the plenary sessions and
within break out groups. TUAC and a number of governments expressed concern
at the omission of any formal agenda discussion on the future role of CIME
in implementation procedures.
In the introductory remarks TUAC re-stated the case for reforms at the
national (NCP) and CIME level to develop an effective Guidelines implementation
procedure. The new draft NCP paper was a step forward, but which only part
reflected the outcome of the January Hague informal meeting. Adequate filters
would be required to screen out frivolous cases, but then genuine cases
should move to a problem solving forum, open to all the interested parties,
with recourse where required to independent experts. According to the outcome
NCPs should be able to make recommendations to the enterprises on how to
bring their practices into conformity with the instrument, which, and according
to the circumstances could be made public. A CIME-level back-up system,
perhaps comprised of a committee of experts, could then deal with cases
breaking down at the national-level.
NGO representatives agreed with the TUAC comments, and re-stated their
case for a register of companies adhering to the Guidelines, with independent
BIAC meanwhile spoke of the need to preserve the voluntary nature of
the Guidelines. In their view non-OECD governments adhering to the Guidelines
should have to do so as part of the 1976 Declaration, rather than treating
the Guidelines as a stand-alone instrument. From that it can be seen that
BIAC have dropped their opposition to the global applicability of the Guidelines.
Concern was expressed at the way in which the commentary seemed linked
to the text. BIAC also preferred to retain the original link of the Guidelines
with the other instruments, eg, National Treatment in the 1976 Declaration.
The discussion then moved onto specific issues around implementation.
BIAC were interested in the concept of functional equivalence, whereby
governments were not bound to a prescriptive list of activities. Within
that the future role of NCPs should be to assist in problem solving, not
to resolve problems on their own. They also raised the question of “standing”,
in terms of which groups would have access to national-level problem solving
where a Guidelines dispute arose with an enterprise. BIAC also stated that
if a conciliation or mediation process were agreed, then it should be invoked
only with the agreement of all parties. Whatever happened then in terms
of reporting on a case, enterprises should not be named. For them the annual
NCP reports to the CIME should be published, though outstanding questions
remained around the inclusion of company sensitive information.
In response NGOs agreed that confidentiality should apply to aspects
of company information, but had grave reservations about blanket confidentiality.
The presumption should be transparency, except where all parties agree
on confidentiality, or while the conciliation procedure is in train. They
agreed with BIAC that all parties should agree to conciliation, subject
to agreement that where an enterprise refused that should be reported by
the NCP publicly. They also agreed with TUAC on the need for certain common
terms of reference for implementation procedures for NCPs. Questions were
raised about whether the implementation procedures were falling behind
those in other inter-governmental bodies. For example, the proposed EU
Ombudsman would have sweeping powers, particularly over the role of sub-contractors
and suppliers in terms of maladministration.
The representative of France argued that outside of progress at the
CIME level, no decisions could be made on functional equivalence at the
national-level. He agreed with TUAC that functional equivalence should
in any case be built around a core set of recommendations common to all
NCPs, and that they should be biased towards maximum standards, not minimum
ones. He also agreed on the need for contestability as an underlying concept,
with the ability for all parties to contest a dispute. Transparency was
also important, and nothing should be ruled out in advance including naming
companies. The credibility of the OECD and its Member governments was at
stake in this process, an issue that shouldn’t be lost sight of.
The Chair responded that the government only NCPs could ultimately be
accountable to parliament. Chile wanted a better understanding of how non-OECD
governments would be involved in drafting the annual NCP reports to the
CIME. The Mexican representative asked the NGOs if they would be prepared
to disclose information on their sources of funding. In his view confidentiality
of all information was as a rule essential, a factor that should extend
to naming companies. On this, the Mexican experience with the NAFTA labour
side agreement had not been a good one, where confidence had not been respected.
The Belgian speaker announced that the 53rd meeting of the tripartite
NCP had just taken place. He recalled that expectations were high in the
1970s as regards the Guidelines. However, in practice governments had allowed
them to fall into disuse, so today they were seen as a failure. His government
had been prevented from naming Renault during the Vilvoorde case under
the Guidelines, but it nevertheless happened on a daily basis in the press,
bringing the Guidelines into disrepute in Belgium.
The representative of the United States stated that the objective of
the Review should be to get the widest acceptance of the Guidelines both
in principle and practice. The outcome would have to be credible to TUAC
and NGOs, while addressing the concerns of business, and leaving no opportunity
for abuse. On that, firm procedures were needed. As regards mediation or
conciliation, again the focus should be on procedural issues, and
he expressed some sympathy for the TUAC view of having common procedures.
There was also a case to be made for sacrificing transparency for conformity
to the Guidelines. On promoting the Guidelines there should be more of
a role for the social partners. He asked TUAC whether confidentiality should
be respected in a case where an NCP had made a recommendation for a company
to comply with.
The Italian representative stated that confidentiality should be the
exception to the rule, and sympathised with Belgium on the need for more
binding standards. The speaker for the European Commission suggested among
other things that one possible role for an independent expert(s) could
be to decide on whether a case should be received by the NCP.
TUAC responded by stating that any move by governments to rule out naming
enterprises would further undermine the credibility of the OECD as well
as the Guidelines. Affiliates would see that as a deal breaker. A procedural
annex, along with a further revised Council Decision were welcome steps
forward, but further work was needed on key issues such as the modalities
for bringing cases forward, reporting, and contestability, and not just
at the national level. The NCPs would have to play a central role in implementing
the Guidelines. That would include promoting dialogue with and between
interested parties, but ultimately the NCP would have to take decisions
on, among other things reporting. As regards reporting, whether at the
national or CIME level TUAC agreed with the NGOs that transparency as a
rule, with confidentiality where agreed should be the base line.
BIAC returned to the role that implementation procedures should play.
For them a positive approach was required to help business conform to the
Guidelines, rather than to force them. One speaker stated that NCPs as
decision makers would in turn lead to sanctions, which was a back door
route to compulsory Guidelines. A BIAC speaker asked TUAC for their views
on what should happen if mediation failed, and what type of decision should
an NCP give in that case.
In response a TUAC speaker said that first and foremost every effort
should be made to solve a problem. The key issue was to effect a change
in behaviour of an enterprise where the Guidelines were breached. If that
was the result and a case was solved, then interested parties should have
the right to agree that the outcome remains confidential. However, if the
outcome of the Review was that all parties had to agree before a case was
heard, and if an enterprise then blocked a case the NCP should publish
a report stating the reasons why the case would not be heard, and within
that name the enterprise. Alternatively, were a case to go ahead, and if
no agreement could be reached among the parties a number of options could
occur. The NCP could bring in an independent expert to make recommendations
based on the merits of the case. The NCP itself could make a unilateral
decision, and on the basis of that make recommendations. Or, the case could
be referred up to the CIME to make a recommendation for action. TUAC had
suggested that a group, including outside experts be convened at
the CIME level to assist in problem solving. On the specific issue of full
agreement to initiate conciliation/mediation, governments were asked to
reflect on the fact that such a procedure was required to invoke a case
under the ILO Tripartite Declaration on Multinational Enterprises and Social
Policy. In practice employers blocked the majority of cases brought forward.
In further discussions the representative of the Brazilian government
called for more prescriptive implementation procedures, and that the CIME
should have a role in problem solving. He also agreed with TUAC that inter-agency
NCPs would probably work better than those organised by single government
The Swiss government speaker favoured a practical rather than a theoretical
approach to problem solving. Clear procedures would be required for that
to work, and also to build confidence among participants. The procedural
annex would have to be more prescriptive on certain implementation issues.
The Belgian government speaker raised the need for sanctions or penalties
as in his view ‘sticks’ were needed to ensure enterprises implemented the
Guidelines. France expressed sympathy with that view, but questioned a
sanctions based approach when the Guidelines were non-binding recommendations
to enterprises. Naming a company that breached the Guidelines would be
the best approach.
BIAC returned once more to the problem solving aspect of implementation.
For them the NCP should decide upon the procedures to follow where a case
was raised. In a new departure they agreed that the NCP should have the
ability to make recommendations to an enterprise, including for remedial
action, but retained their opposition to naming companies. They maintained
that the agreement of all parties would be required to initiate mediation/conciliation.
However, they signalled that they would re-think their opposition to the
publication of a report by an NCP with recommendations to a company.
A German government speaker indicated that the Guidelines were known
and respected by multinationals operating in Germany, and German ones operating
abroad. All cases brought before the NCP had been solved, and of the three
cases brought in 1999, one had been solved, and three were being considered.
He was of the view therefore that the current system was working well,
and that conciliation would bring the system close to a tribunal system.
Furthermore, the OECD should not become an international arbitration system.
The discussion then turned to the role of non-OECD governments in the
implementation procedures. BIAC were for the most part concerned with ensuring
that non-Member governments signed up to the whole of the 1976 Declaration,
and not just the Guidelines. Most government speakers, TUAC and NGOs did
not foresee major problems in implementing the Guidelines outside of the
OECD. The one exception was the US who suggested that in practice follow-up
might prove difficult.
A discussion then took place around the French idea for the OECD to
initiate a register of companies supporting the Guidelines. The speaker
suggested that audit companies could verify whether companies wishing to
be on the list had implemented the Guidelines, or that companies themselves
could produce their own report on compliance. A further suggestion was
for random unannounced checks, perhaps one or two per year. Such a move
was supported by the NGOs. BIAC re-stated their opposition to the idea.
TUAC raised practical questions around monitoring, implementation and verification
procedures, especially as they applied to suppliers and sub-contractors.
The point was also made that such a move could reinforce the idea that
the Guidelines were a voluntary instrument for individual enterprises to
endorse or not, rather than an instrument applying to all enterprises.
Rather than a register a TUAC speaker floated the idea that individual
enterprises be encouraged by the OECD to express their support for Guidelines.
Textual revisions were handled in the plenary sessions and break out
groups. A wide ranging discussion took place on the preface. BIAC complained
that one paragraph in particular was too negative toward multinationals.
TUAC and NGOs in contrast said it was too weak in its criticisms. TUAC
also called for the deletion of the word “voluntary”, as it suggested the
Guidelines were optional. TUAC and NGOs agreed that the word “principles”
be replaced by “standards” as in the original text. The Chair of the Working
Party requested that the TUAC Secretariat forward to him text on certain
A number of points were raised during the discussion on the General
Policies chapter. BIAC both opposed the language on human rights and called
for a different interpretation, while looking to weaken the whistleblower
text. TUAC and the NGOs called for strengthened language on human rights,
suppliers and sub-contractors, disclosure issues, including lobbying activities,
and the language on whistleblowers.
TUAC and BIAC presented their points as set out in their respective
background papers on the Employment and Industrial Relations chapter to
the meeting, and notified the Chair that they would have no-strings discussions
in an attempt to reach a consensus on key points. A debate took place on
the trade union proposal to replace “employees” with “workers” so as to
take account of changing work patterns within multinationals and their
suppliers. An NGO proposed that the chapter include a reference to a living
wage, which was opposed by BIAC, who were in turn criticised by the French
government spokesperson. A short discussion also took place on the need
to strengthen the text on child labour, with little dissent from governments.
The breakout group discussion on the Environment chapter saw BIAC attempting
to weaken the text, and TUAC and NGO speakers pressing for it to cover
sustainable development, including issues around workers’ health and safety,
including the right to refuse unsafe work, and protection for whistleblowers
in all these issues.
The Disclosure chapter was discussed in a breakout group. TUAC and NGOs
argued strongly that disclosure requirements should cover key elements
of enterprise relationships with suppliers and sub-contractors, with BIAC
opposition. BIAC also opposed the joint trade union and NGO proposal that
the word “encourage” be replaced by “should” in the chapeau to paragraph
A breakout group discussion on the Bribery chapter saw a BIAC speaker
question the need for the chapter itself. He then argued to weaken the
already weakened text on whistleblowers, and to delete the text covering
company to company bribery. The US government speaker spoke in favour of
the chapter, and the breakout group Chair noted the consensus in the Working
Party for the chapter. TUAC and NGO speakers countered the BIAC arguments
and called for the original whistleblower text to be reinstated, and strengthened
company to company language. It transpired that the OECD Working Group
on Bribery had drafted the original whistleblower text that was subsequently
weakened by the Guidelines’ Working Party.
Press conference by Chair of the OECD Working Party on the Review
The Chair of the OECD Working Party on the Review of the Guidelines
held a press briefing on 24 February to promote the Review. Prior to that
the TUAC secretariat held its own press briefing. Annex two contains the
subsequent press articles.
The Working Party Chair in his introductory remarks said that the Review
had entered a new phase whereby the views of the social partners were being
incorporated into the text, both through the formal and informal consultation
procedures. Regarding the text, an explicit reference to human rights had
been included, all core ILO labour standards were too, the focus of the
environment chapter was on sustainable development, and an explicit reference
to an enterprise’s supply chain had also been included.
He talked also of a “new political will” to make the implementation
procedures work, based on the principles of visibility, accessibility,
transparency and accountability, which he hoped would go far enough to
gain the endorsement of TUAC, BIAC and NGOs. In the following discussion
he was asked whether the Review would specifically allow the naming of
companies. In response he said that governments were seeking to develop
a problem solving framework for the Guidelines that would produce solutions
acceptable to all. However, differences remained on key issues within that
procedure. He was then asked about the main divergences within the Review,
to which he replied: the strength of the text on human rights; the treatment
of the ILO core labour standards; the extent to which the Guidelines should
be extended down the supply chain; and implementation procedures at the
national and CIME levels. He concluded by saying that he was looking to
trade unions to help formulate language on child labour.
On the basis of the comments made by certain governments at the consultations,
alongside those made at the following press seminar by the Chair of the
OECD Working Party on the Review, some progress, however slight has been
made in pushing the Review toward the TUAC position. Movement among certain
BIAC affiliates, and their desire for bilateral discussions on the text
and implementation procedures is also welcome.
However, more pressure on governments at the national level will be
needed, on textual amendments, but more importantly, implementation procedures.
Attached for information is new text prepared by the TUAC Secretariat following
consultation with affiliates that covers the Employment and Industrial
Relations chapter and the Preface. It supplements previous TUAC proposals.
Some affiliates may also be canvassed by their government for views
as to whether the 26-27 June meeting of the OECD Council of Ministers is
a feasible deadline for the Review. At this point it makes sense to hold
to that date, as a means of maintaining pressure for a satisfactory outcome.
At some point though it may make sense for the deadline to be pushed beyond
the Ministerial meeting, but with textual amendments and implementation
procedures remaining as a package. Any de-linking of the two issues could
result in agreement in June by Ministers on a new text, with implementation
pushed into an uncertain future timetable.