The current Review of the OECD Guidelines for Multinational Enterprises has reached a critical phase. TUAC’s objectives have been:- to establish an effective implementation mechanism in which National Contact Points have amongst other things clear instructions to help resolve cases raised and to make public recommendations; to back this up with an efficient OECD level implementation process; to reinforce the global application of the Guidelines with a clear responsibility for companies to respect human rights and to ensure their supply chains respect the Guidelines; and to have an updated and strengthened text which on employment and industrial relations includes reference to all ILO core labour standards.

Progress has been made. The text is close to agreement although TUAC is insisting on stronger language on child labour. There are clear statements on the global scope of the Guidelines and language is included on the promotion of guidelines amongst companies “business partners”, although this is currently qualified as “where appropriate”. Most of this progress has come in the face of fierce opposition from BIAC and a minority of its key affiliates, who have also conducted effective lobbying campaign in some capitals. 

However, although significant progress has been made on developing a workable or at least testable set of implementation procedures for National Contact Points, at the most recent meetings of the OECD Committees and Working Groups on 17-21 April 2000, a small number of governments succeeded in getting language added to the draft OECD procedures which would cloak much of the procedures in secrecy on the grounds of confidentiality. This could risk rendering them ineffective.

The Working Party on the Review and the CIME will next meet on 15-17 May in an attempt to finalise negotiations ahead of the 26-27 June meeting of the OECD Council of Ministers that is scheduled to endorse the outcome of the Review. TUAC, BIAC and NGOs will have consultations with the Working Party on the morning of 15 May.

Stepping up pressure by TUAC affiliates at the national level in the run up to these meetings is essential and could have a real effect.

The remainder of the TUAC note highlights the changes that have been made by the Working Party on the Guidelines and the CIME to the various texts. It then focuses on those key issues where it is essential for affiliates to pressure their governments over the days ahead.
 

Recent Developments

The OECD Working Party on the Review of the Guidelines and the CIME met on 17-21 April 2000 to negotiate further changes to the implementation procedures, text and commentaries to the Guidelines. A TUAC delegation along with representatives of BIAC and NGOs held a consultation with Working Party members on 14 April, itself preceded by a TUAC preparatory meeting. The new draft texts that emerged from the OECD meetings are attached for information. The draft implementation paper includes proposed revisions to the OECD Council Decision and a Procedural Annex that sets out operational guidance to the National Contact Points and the CIME. The draft commentary is at this time restricted to key features of the Procedural Annex. This will be supplemented shortly by other commentary. The new draft text and commentary includes revisions made at the 17-21 April meetings.
 

Implementation Procedures (DAFFE/IME/WPG/RD(2000)17

The new draft implementation procedures retain the form of the previous proposals, in that the onus is on National Contact Points (NCP) to promote the Guidelines, provide a forum such as conciliation or mediation to assist in resolution of cases, to then make recommendations to the parties on implementing the Guidelines, and to make them publicly available. The CIME role would be to consider whether an NCP has followed the procedures in handling a case, or has correctly interpreted the Guidelines in responding to a complaint. It would retain its role in issuing clarifications of the Guidelines. The TUAC proposal to include a reference in the Procedural Annex, such that the NCPs operate in accordance with the core criteria of visibility, accessibility, transparency, and accountability has been included in the text.

However, a number of changes have been made to the text and commentary that limit transparency of all problem solving activities, while raising the possibility that all aspects of the conciliation or mediation procedures, including any outcomes remain confidential. The previous implementation text and commentary struck a balance between where necessary confidentiality for the process, and transparency for the outcome. Now, confidentiality has been extended beyond that acceptable to cover sensitive business information to include all procedures covered by paragraph 2, and potentially the outcome of any conciliation or mediation. Particularly problematic is the inclusion of a new paragraph 4. a, in section C of the Procedural Annex for NCPs:

“In order to facilitate resolution of the issues raised, take appropriate steps to protect sensitive business information. The procedures of paragraph 2 will remain confidential unless otherwise agreed by all the parties concerned.” 

That has been compounded by the addition of a new paragraph 42bis in the commentary, along with revisions to paragraph 45 of the commentary.

TUAC Proposal Paragraph 4. a, of section C. must be deleted, along with the second sentences of paragraph 42bis and 45. Governments should be aware that failure to do this would render the whole of the core procedure ineffective.

Paragraph 40 of the commentary to the implementation procedures has been revised in such a way that some governments could screen out or delay legitimate cases that otherwise would be handled by the NCP. In particular a new indent states that the NCP will take into account:

“the procedural status and relevant results with respect to the treatment of similar or identical issues in other proceedings at the domestic and international level.”

TUAC Proposal. The Guidelines are supplementary to national law, and as such that indent should have no bearing on the receivability or otherwise of cases by an NCP. As such governments should be urged to delete it.

The current follow-up procedures at the CIME would allow TUAC to bring cases forward were the NCP to fail to follow the procedures laid down in the Procedural Annex, or if we were to feel that the NCP had interpreted the Guidelines incorrectly in a specific case. Furthermore, the proposed procedures would allow the CIME to seek expert advice on any matter relating to the Guidelines from organisations, for example, the ILO. However, that falls short of the TUAC demand for a more efficient and faster system in the CIME in the event that national level procedures fail to resolve a case.

TUAC Proposal Governments should be urged to agree to the establishment by the CIME of a “group of experts” to pronounce its views on Guidelines related cases and make recommendations to the parties.
 

Revisions to the Guidelines Text and Commentary

Progress, even if it does not fully meet all our objectives, has been made on textual amendments: the extension of the Guidelines into the supply chain; the inclusion of language to cover human rights; the inclusion of child and forced labour into the Employment Chapter, along with a reference to give workers prior notice in the event of major changes in plant operations; protection for whistleblowers; a new Chapter on bribery; and strengthened provisions on disclosure of information, etc. At this stage therefore affiliates may wish to keep the campaign focus on the implementation procedures, and to press for priority amendments (set out) to the text and commentary, while stating opposition to any attempts by some to undo the progress made. 
 

Commentary to the Chapter on General Policies

Paragraph 2 is an attempt to build on a previous clarification that distinguished the Guidelines as being supplementary to domestic laws, but which confuses the issue. The paragraph also ranks multinational enterprises as partners with governments in the development of both voluntary and regulatory policies, while stating that governments should merely consider the views of other stakeholders. 

Maintaining the distinction between the Guidelines and domestic laws is a key issue, especially as regards the implementation procedure. Paragraph 2 should read:

“Every state has the right to prescribe the conditions under which multinational enterprises operate within its national jurisdiction, subject to international law and the international agreements to which it subscribes. The Guidelines are not a substitute for national laws, to which multinational enterprises are fully subject. They represent supplementary standards of behaviour, particularly concerning the international operations of these enterprises.”

That language is taken from page 30 of the Green book on the Guidelines. The rest of the chapter should then be deleted, or balance the input of the social partners into relevant policy development.
 

Employment and Industrial Relations Chapter

At the April meeting of the Working Party meeting on the Review, the ILO representative tabled amendments to paragraph 1. a, to bring it more in line with ILO principles, upon which many governments expressed support. Affiliates should urge their governments to support: 

1.a Respect the right of their employees to establish and be represented by trade unions and other bona fide representatives of employees, and engage in collective bargaining and constructive negotiations, either individually or through employers’ associations, with a view to reaching agreement on employment conditions.

b) Refrain from using child labour in all their operations. Contribute to the effective abolition of child labour, and in particular, not engage in the worst forms of child labour in their operations. The commentary would require revising to take account of these changes. 

c) Refrain from using all forms of forced or compulsory labour in all their operations. Contribute to the elimination of all forms of forced ore compulsory labour and, in particular, not engage in the use of such labour in their operations; 

4  b) Take appropriate steps to ensure occupational health and safety in their operations, and to respect workers’ rights to refuse to engage in hazardous or dangerous work practices. 

Paragraph 2 of the commentary draws on the WTO Singapore Declaration and refers to the ILO as the “competent body to set and deal with international labour standards…” In light of the trade union campaign on labour standards at the WTO, affiliates should press governments to delete “and deal with ” from the sentence, such that it would state “The ILO is the competent body to set international labour standards…”
 

V. Environment

New paragraph 8. Recognise the role of workers’ Health and Safety and Environment representatives and the right of workers to refuse unsafe, unhealthy and environmentally damaging work. 
 

Next Steps for TUAC Affiliates

The majority of OECD governments will be finalising their positions on the Review ahead of the 15-17 May meetings of the OECD Working Party on the Review and the CIME. Some Ministers and/or their political advisors could be taking a direct interest in this for the first time. TUAC affiliates may be consulted as part of this process. BIAC affiliates will lobby their governments intensely on this.

Several TUAC affiliates have already discussed the Review with Ministers, their policy advisors, or senior government officials. It is important that Ministers, even if already approached, are made aware of the trade union concerns around the issues set out in the note.