Enforcement Instruments for Social Human Rights along Supply Chains

218 Pages·2017·5.15 MB·English

by  Christoph Scherrer (ed.)

Enforcement Instruments for Social Human Rights
along Supply Chains
Labor and Globalization

Volume 9

Edited by Christoph Scherrer
Christoph Scherrer
(Ed.)

Enforcement Instruments
for Social Human Rights
along Supply Chains

Rainer Hampp Verlag Augsburg, München 2017
Bibliographic information published by the Deutsche
Nationalbibliothek
Deutsche Nationalbibliothek lists this publication in the Deutsche
Nationalbibliografie; detailed bibliographic data are available in the
Internet at http://dnb.d-nb.de.

ISBN 978-3-86618-894-5
Labor and globalization: ISSN 2196-5382
First published 2017

Cover photo: A garment worker in the Dharavi locality of Mumbai, 2016,
by Christoph Scherrer.

© 2017 Rainer Hampp Verlag Augsburg, München
Vorderer Lech 35 86150 Augsburg, Germany
www.Hampp-Verlag.de

All rights reserved. No part of this publication may be reprinted or
reproduced or utilized in any form or by any electronic, mechanical, or other
means, now known or hereafter invented, including photocopying and
recording, or in any information storage or retrieval system, without
permission in writing from the publisher.

In case of complaints please contact Rainer Hampp Verlag.
Contents
List of Figures and Tables .................................................................................... iv
Acknowledgments ................................................................................................. v
Notes on Contributors .......................................................................................... vi
1. Introduction ....................................................................................................... 1
Christoph Scherrer
2. Economic Arguments for International Workers’ Rights ................................. 6
Christoph Scherrer
3. Overview of Enforcement Instruments for Workers’ Rights along
Supply Chains.................................................................................................. 18
Stefan Beck / Christoph Scherrer
4. Instruments of German Foreign Economic Policy for Promoting
Co-Determination along Supply Chains ......................................................... 50
Alison Schultz
5. The Enforcement of Workers’ Rights through Conditional or Promotional
Trade Agreements: A Comparison of US and EU Social Chapters.............. 155
Madelaine Moore
6. Corporate Due Diligence: A Contribution to the Enforcement of
Human Rights? .............................................................................................. 186
Christian Scheper
List of Figures and Tables
Figures
Figure 3.1: ILO member countries with trade agreements including labor
provisions by region, 2013 ...................................................... 21
Figure 3.2: Increase in number of labor provisions in bilateral and
regional trade agreements, 1990 – 2013 ................................. 22
Figure 4.1: Review Process of KfW Bank’s Export Financing ..................... 77
Figure 4.2: The different evaluation standards ............................................... 79
Figure 4.3: Due Diligence Procedure for Export Credit Guarantees,
Investment Guarantees and Untied Loan Guarantees ............. 85

Tables
Table 3.1: Labor Provisions in US PTAs ........................................................ 23
Table 3.2: Different types of labor provisions in EU trade agreements ......... 25
Table 3.3: Comparison of Basic Elements for a Labor Chapter ..................... 29

iv
Acknowledgments
This volume brings together a few very recent studies on the enforcement issue
of social human rights. While each of them is offering valuable insights in its
own right, together they provide a fuller picture of the current debates on the
instruments necessary for improving the working conditions of workers in
global supply chains. Therefore, I asked the authors of these studies whether
they would be interested in contributing an updated version of their studies to a
volume on enforcement instruments for social human rights along supply chains.
I am pleased that the authors responded positively and also got permission from
the organizations that previously published their studies as working papers.
The contribution of Stefan Beck and me is taken from a longer study
commissioned by ACTRAV of the International Labor Organization. It was
published as a Global Labour University working paper in October 2016
(“Trade regulation and global production networks”). The contribution of Alison
Schultz is a translation of a study published in German (Schultz und Scherrer,
2017: Mitbestimmung in Zulieferketten. Instrumente der deutschen
Außenwirtschaftspolitik, Hans-Böckler-Stiftung, Working Paper
Forschungsförderung Nr. 033) with the financial support of the Hans-Böckler-
Foundation. The contribution of Madelaine Moore builds on a study
commissioned by the Friedrich-Ebert-Foundation for its project on “Core
Labour Standards Plus”. The chapter by Christian Scheper is a modified and
updated version of Part I of the study “Corporate Obligations with Regard to
Human Rights Due Diligence”, published by the Friedrich-Ebert-Foundation in
2015 (and co-authored with R. Grabosch). My own brief chapter on the
economic arguments for international workers’ rights builds on a number of
previous publications.
I thank Kosmas Kota for translating the long study by Alison Schultz and the
Hans-Böckler-Stiftung for funding the English language translation. I like to
express my thanks to Nicole Magura for formatting the manuscripts.
Many thanks also to Rainer Hampp at Hampp Verlag who was enthusiastic
about the book project from the very beginning. Financial support was granted
by the International Center for Development and Decent Work which is one of
the five Centers of Excellence for Exchange and Development program
managed by the German Academic Exchange Service (DAAD) using funds
from the German Federal Ministry for Economic Cooperation and Development
(BMZ).
Christoph Scherrer Berlin, May 2017

v
Notes on Contributors
Stefan Beck is an adjunct lecturer at the University of Kassel, focused on
political economy and comparative research on capitalism. He holds a PhD in
political science from Kassel University. He published on the export surpluses
of Germany (“Vom fordistischen zum kompetitiven Merkantilismus”,
Metropolis) and issues of international trade in general.
Madelaine Moore is an associate PhD fellow at the International Center for
Development and Decent Work (ICDD) at the University of Kassel. She
received her MA in Labor Policies and Globalization from the Berlin School of
Economics and Law and the University of Kassel as part of the Global Labour
University. The PhD thesis is about struggles over access to water from a Social
Reproduction Feminist perspective. Her areas of interest include social
movements, Social Reproduction Feminism, Labour Rights and Global Value
Networks.
Christian Scheper is a postdoctoral researcher at the Institute for Development
and Peace at the University of Duisburg-Essen. His work focuses on human
rights, transnational corporations and the politics of global production. He holds
a PhD in political science from the University of Kassel. In his dissertation he
analyzed the discourse on corporate responsibility for human rights in the
context of global production networks.
Christoph Scherrer is director of the International Center for Development and
Decent Work at Kassel University. He works on issues of the international
political economy and labor. His most recent books are: Public Banks in the Age
of Financialization: A Comparative Perspective (Edward Elgar; forthcoming),
Combating Inequality: The Global North and South (co-edited with A.Gallas/H.
Herr/F. Hoffer, Routledge, 2015), Financial Cultures and Crisis Dynamics (co-
edited with B. Jessop/B. Young, Routledge, 2014)
Alison Schultz is a master student of Global Political Economy at the University
of Kassel. She has published on the Latin American debt crisis (with L. Rama
Iglesias “What Kind of Challenges does a Debtors’ Cartel Face? An Analysis of
the Latin American Debt Crisis”, New Research in Global Political Economy
2015/2) and is currently working on fossil fuel divestment.

vi
1. Introduction
Christoph Scherrer
Dire working conditions are prevalent in the labor-intensive segments of global
value chains. Suicides, such as those that occurred at the some of the Foxconn
consumer electronics assembly plants in China, and accidents such as the
collapse of the Rana Plaza garment factory in Bangladesh, have made
consumers more attentive to the plight of workers. For many years, trade unions
and human rights nongovernmental organizations have called on corporations
and governments to take responsibility for ensuring the human rights of the
workers in sweatshops around the world. In response, corporations have
developed internal codes of conduct and have hired corporate social
responsibility staff and consultants to certify their suppliers’ labor relations. By
signing on to the United Nations Covenant on Economic, Social and Cultural
Rights and membership to the International Labor Organization, governments
have committed themselves to respect social and human rights, encompassing
freedom of association and the right to organize and bargain collectively.
Economically advanced countries have also written OECD guidelines for
businesses outside their home countries. And recently all member countries of
the United Nations have underlined their commitments to the human rights of
workers by including the goal to “Promote sustained, inclusive and sustainable
economic growth, full and productive employment and decent work for all” in
the Sustainable Development Goals for 2030.
The rising awareness of the plight of workers in supply chains and the
pronouncements of governments and corporations has not, however, resulted in
improved working conditions for most of these workers. For example, the
infamous Rana Plaza building had been inspected shortly before it collapsed.
After this tragedy, efforts were mounted to prevent another disaster from
occurring, but despite the great attention the tragedy gained, the preventative
measures implemented fall far short from what is necessary (Khan/Wichterich
2015). Some governments have even committed themselves in trade agreements
to uphold labor standards. Yet, the most famous and elaborate labor chapter in a
trade agreement, the labor side agreement to the North American Free Trade
Agreement (NAFTA) has not protected workers against labor rights violations
(Greven 2012). In sum, corporations and governments have yet to take the step
from pronouncements to the actual enforcement of their commitments.
The lack of enforcement of labor rights is the unresolved key issue in the world
of work. It therefore deserves our attention. This volume takes up the challenge
and explores the effectiveness and feasibility of the enforcement instruments
under discussion. It starts with a general overview of the currently considered
instruments for ensuring better working conditions and respect for the human

1