Conference (ILC)? Manuela Tomei Conditions of Work and Equality - PowerPoint PPT Presentation

Global supply chains: Why a topic at the International Labour Conference (ILC)? Manuela Tomei Conditions of Work and Equality Department (WORKQUALITY), ILO 1

What are global supply chains? Organization of production and delivery of a range of goods and services by lead firms through complex chains of suppliers and sub- contractors that span many different countries. 2

Global supply chains range within 2 main types: 1. Foreign Direct Investment (FDI) by MNEs in wholly-owned subsidiaries or joint ventures 2. International sourcing: lead firms engage with a “cascade” of suppliers and sub-contracted firms with which they have no direct contractual relation, except for first-tier suppliers and/or intermediaries 3

FDI inflows by region 4

Global supply chains and employment  Employment opportunities in developing countries incl. for women, youth and migrants  Scale of employment in GSCs difficult to estimate but substantive and growing  Quality of employment is a concern, esp. wages, OSH, working time and non- standard forms of employment (NSFE) 5

Why is ILO involved?  C.177 on home-based work (1997); Social Justice Declaration (2008)  Value-based approach to development  Mandate and expertise in the world of work  Tripartite structure  Convening power to bring together main actors required to bridge governance gaps 6

Why is ILO involved?  UNCTAD World Investment Report 2013  WTO Global Value Chains in a Changing World 2013  OECD, WTO and UNCTAD for G20 in 2013  Extensive research on global value chains and global supply chains  BUT: first time quality of employment discussed at global level 7

Types of governance and related challenges  Public governance  Private governance  Social partners’ initiatives  Multilateral initiatives Challenges  Regulatory space is crowded and confusing  Lack of coherence and coordination  Limits on extra-territorial application of legislation 8

Workers’ views  Concerns about downwards pressure on conditions of work as a result of competition among suppliers  Address global governance gap to ensure global floor of rights at work  Tripartite constituents to become drivers of change to achieve decent work in GSCs  Possible gaps in International Labour Standards and the MNE Declaration 9

Employers ’ views  GSCs stimulate growth/decent work and are proven means of development  Workers in GSCs enjoy better conditions than those outside GSCs. Pushing for DW for those already better off creates 2- tiered system  International buyers and MNEs do not control/coordinate GSCs: suppliers are independent legal entities governed by national legislation  Central problem is lack of enforcement of national legislation  The primary duty to protect/enforce should not be shifted from States to companies 10

Governments’ views  GSCs contribute to sustainable development and stimulate growth and employment  DW challenges exist particularly in production/supplier countries  Governance gaps at the national, sectoral, regional and global level: close through ILS, national legislation and enforcement  Workplace compliance is primary duty State; GVTs often struggle with enforcement.  Level playing field - avoid protectionism.  Business responsibility: due diligence  Inadequate national legislation concerning NSFE, informality, outsourcing, subcontracting and labour migration 11

Comprehensive ILO approach  International labour standards  Closing governance gaps  Inclusive and effective social dialogue  Cross-border social dialogue  Capacity building and development cooperation  Harmonizing processes and sector-level approaches  Labour Administration & Inspection  Knowledge and statistics  Partnerships 12