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International Labour Standards, Voluntary Initiatives & Social Dialogue in India C S Venkata Ratnam, IMI, India & Anil Verma, University of Toronto Canada.

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Presentation on theme: "International Labour Standards, Voluntary Initiatives & Social Dialogue in India C S Venkata Ratnam, IMI, India & Anil Verma, University of Toronto Canada."— Presentation transcript:

1 International Labour Standards, Voluntary Initiatives & Social Dialogue in India C S Venkata Ratnam, IMI, India & Anil Verma, University of Toronto Canada

2 India – A statistical profile n Population : 1 bn. Plus n Workforce: 384 mn. Plus n Organised labour force: 28 mn. n Unionised labour force: 16 mn. Plus n Unemployment – No. on rolls of employment exchanges: 40 mn. Plus n Educated unemployment increasing n Incidence of poverty poor among employed than unemployed!

3 India and International Trade n India’s share in FDI very low n India’s share in international trade declined from 1.5% at the time of independence to 0.67% in 2000 n 300 Japanese investment in India against 3000 in Singapore n Major exports: textiles, gems and jewellery and software n Exports: volumes up but revenues down n Imports: revenue outgo increasing faster than volume

4 India & International Labour Standards n ILO member since 1919 n Ratified 38 out of 182 conventions n Ratified only 3 of the 8 core conventions: 29,100 and 111 n Will soon ratify 182 n Still has reservations about ratifying 87 and 98

5 Foundation of ‘Decent Work’ n The ILO Declaration, 1998: Affirming the right of every one to “conditions of freedom and dignity, of economic security and equal opportunity.”

6 Social Clause and Indian Legislation n Social clause aspect –Freedom of association and right to collective bargaining n Legal position –Freedom of association fundamental right –Trade Unions Act, 1926 meets with part of the objectives of Conventions 87 and 98

7 Social Clause and Indian Legislation n Social clause aspect –Forced labour Conventions 29 and 105 n Legal aspect –Article 23 of Constitution and Bonded Labour System (Abolition) Act, 1976. India ratified Convention 29, not 105

8 Social Clause and Indian Legislation n Social clause aspect –Minimum Age Convention 138 and 182 concerning immediate action to end the worst forms of child labour n Legal aspect –Child Labour (Prohibition and Regulation) Act, 1986 prohibits employment of children below 14

9 Social Clause Aspect n Social clause aspect –Equal Remuneration Convention 100 n Legal aspect –Ratified Conv. 100 –Equal Remuneration Act, 1976 seeks to provide for equal remuneration to men and women

10 Social Clause and Indian Legislation n Discrimination (Employment and Occupation) Convention 111 n Legal aspect –India ratified Conv. 111 –Caste discrimination still a problem. Became an issue in Durham conference in 2001

11 Universal Floor and India n Freedom of association and right to collective bargaining – not ratified n No child labour – highest in India n No forced labour – persistent n No discrimination – still a problem

12 Decent Work Deficit – Employment Gap n Employment gap : subsistence to existence –160 million openly unemployed –with underemployed, the number skyrockets to one billion –Half the population lives on less than US$2 a day –500 million new jobs required over the next 10 years –job creation is priority. Work without rights is a permanent trap into poverty – all these are a problem in India

13 Decent Work Deficit – Rights Gap n 250 million child workers n 20 million workers in debt bondage n Nearly 2 out 5 countries in the world have problems with freedom of association n Decentralisation and deregulation is adversely impinging on union density, coordination and bargaining power n World Bank orchestrating support for labour law reform that reduces existing protection

14 Decent Work – Social Protection Gap n Only 20 per cent of workers have social protection n 3000 people die every day due to work related accidents or disease n In some countries more man-days are lost due to work related depression than strikes and lockouts n Only 7% enjoy a semblance of social protection in India

15 Decent Work Deficit – Social Dialogue Gap n Representational gap n 27 million workers in export processing zones have no or little voice n Less than 7% participate in social dialogue n Weak tripod. Huge social exclusion n Civil society institutions growing in strength and asserting. In India, public interest litigation, consumer courts and environmental litigation restraining and relegating the rights of labour and management to a backseat

16 Balanced Approach – Dual Concern for Equity and Efficiency n Flexibility and competitiveness –employment friendly – need for wage moderation –should not be synonymous with insecurity –socially responsible and people sensitive enterprise restructuring –Markets should work for all: not just shareholders, but all stakeholders

17 Globalisation and Labour Standards n Growth of international production chains to seek competitive advantage n View from the north –race to bottom; job shift to south n View from the south –competitiveness depends on productivity –low standards mean low productivity –developing countries share in manufactured goods export marginal

18 Linking International Labour Standards to International Trade n Arguments for –provide a universal social floor –work first and rights later: a virtuous cycle –rights and representation critical to achieve decent work –avoid race to bottom n Arguments against –seek to deny comparative advantage of cheap labour to developing county –seek to save developing countries from development

19 Different Aapproaches to International Labour Standards n ILO Principles: moral persuasion without sanctions n WTO – keep off n Voluntary initiatives – sanctions at market places – new non-tariff barriers making compliance a condition for trade,investment, etc.

20 ILO Approach to Universal Social Floor n OECD, ICFTU – Core standards/social clause n UN Social Summit, 1985 n Singapore Trade Ministers Conference, 1996 – WTO keep off n ILO Fundamental Principles Declaration, 1998 n Decent work, 1999

21 Voluntary Private Efforts n Corporate Codes of Conduct –Ethical Trading Initiative (ITI) –Clean Clothes Campaign (CCC) –Fair Labour Standards (FLA) –Social labeling n SA 8000 n Consumer boycotts

22 The Fair Labour Association n US-based NGO and US universities n Large apparel firms n Developed a code n Developing, monitoring and reporting procedures n Plans to publish audit results n Issue sweat-free labels n Remedies and sanctions not clear

23 Socially Responsible Investment H Brill and J A Brill (1999). Investing with Your Values: Making Money and Making a Difference, Princeton, Bloomberg Press. n ILO Tripartite Declaration on MNEs and Social Policy & OECD Guidelines n SRI – pay attention to social consequences of investment decisions: –Domini 400 Social Index – superior performance over Standard & Poor’s 500

24 UN Global Compact n Core labour standards n Human rights n Sustainable development n Indian firms subscribing to Global Compact. Case studies and training programmes on the cards

25 Voluntary Intiatives and Indian Situation n NGOs in the forefront in securing minimum social floor n Carpets: Kaleen and Rugmark n Sports goods in Jallundhar – Initiative similar to Sialkot in Pakistan n SA 8000 Audit: 3 of 72 firms are Indian. Roughly half are Chinese n Commerce Ministry taking initiative in textiles n Worry about core labour standards becoming non-tariff barriers

26 Attitudes of Social Partners in India n Reject labour rights – WTO linkage n Uphold the principles of universal labour rights and the need for evolving structures to monitor the enforcement of labour rights n Set up UN Labour Rights Commission n Establish national level powerful National Labour Rights Commission n Unions reject rights – WTO linkage globally but locally strive to improve them. Fighting a losing battle in the context of global competition.

27 Three Steps in Labour Standards Regulation n Develop standards –relatively easy –ILO core labour standards –Corporate codes of conduct n Monitor reports –relatively harder n Remedies and sanctions –Most difficult

28 Implications for Employers and Workers n Voluntary initiatives at market place more visible impact than lowest common denominator of consent at higher level – but they have slow pace and low coverage n Adherence to fair labour practices is key to remain in business and succeed n It is necessary to focus on the entire supply chain n Need to overcome the notion: jobs first and rights later. Jobs without rights will make ‘decent work’ elusive forever.

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