INTERNATIONAL POLITICAL ECONOMY

CRITICAL ANALYSIS
The Struggle for Workers’ Rights in a Global Economy

Submitted by: Adnan Ul Haq

ERP ID: 18508

Submitted to : Dr Lalarukh Ejaz

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The Struggle for Workers’ Rights in a Global Economy

Introduction:

Achieving worker’s rights , indeed , have been a real struggle and even now its contributors

working with high profile companies, the non-governmental organizations, international

regulatory bodies and newly formed trade unions on several continents explain why the real

wages of the workers have declined in the majority of garment factories , the corporate social

responsibility programs have failed and why the unions and other workers organization have had

such difficulty in establishing themselves in China, Central America and South Asia. The

incident of Dhaka in 2013 where eleven hundred workers lost their lives working in Rana Plaza

factory, an apparel manufacturing company, shows the exploitation and corruption of workers’

rights. The real causes of the tragedy were low wages, poor working conditions and the unheard

voices of the labors who work in the export industries of the global south.

Today , the retail dominated chains, commanded by executives in Walmart, Nike, Adidas, Zara,

Apple and H&M generate half of all the world trade and employ millions of workers across

different parts of the world. Having enormous power, these retail executives squeeze prices and

wages and steer world capitalism towards their interests. Moreover having employed several

labors they as well determine the worldwide distribution of labor for their huge stream of

commodities that flows across different countries. According to Jill Esbenshade , in a world

dominated by global supply chains, there exists a “Triangle of Power“ with employers ,

contractors and government joining the points. These three points in extension are now brands,

their contract factories and the large western NGOs that nudge these corporate brands to improve
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labor standards , monitor firms hired by these brands to have inspection of their factories for any

non compliance activities against labors and report them back.

Analysis :

The role different world organizations in revitalizing global economy and labor rights:

The creation World trade organization (WTO) and North American Free Trade Agreement

(NAFTA) in an attempt to liberalize world economy and strengthen labor rights have been in

question especially in the case of the latter one. Before forming the analysis we need to

understand two basic questions:

1. The regulation of capital and labor rights amongst countries having extraterritorial rules?

2. The relationship between the equity groups effecting labor rights in different parts of the

world?

Extra territorial rules involve a state demanding the corporations having head quarters in their

state or are engaged in the economic activity in their state conduct the business practices

according to the home state’s rules. The preferences of the particular state become the bench

mark for the corporate behavior in other countries. This extra territorial jurisdiction may have

negative or positive impact but mostly negative in my opinion. Many people say that developed

states prosecuted the corporation for using slave labor which is in fact a good thing. However, in

a bigger picture many states objected such rules for examples like the US Helms – Burton Act of

1996 forbidding trade with Cuba. The U.S threatened the corporations that did business with it to

avoid any trade with Cuba. The extra territorial rules show the balance of power lies within a

particular state rather the consensus of international community.

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After the creation of WTO many points of international labor movement were addressed in the

organization by incorporating labor standards and its principles. The major elements include :

 Abolition of child labor

 Effective elimination of all forced and compulsory labor

 Freedom and effective recognition of rights of the labor

 Removal of any discrimination on the basis of employment and occupation

The labor movement however was unable to achieve any enforceable rights in the international

institutions because of liberal states who argued that economic growth within a state would lead

to increased labor standards and any interference in trade due to labor reasons might result into

lower gains. The developing countries also opposed the movement as they fear this would allow

developed countries to use this as a form of protection against them. The business associations

also showed a red flag as they were of the perception that this would give rise to protectionism

and reduction in profits simultaneously.

Efforts of Unions and Consumer groups :

The unions have pursued steps through International labor Organization and took initiatives to

set out labor standards and put them into 1998 ILO declaration on fundamental principles and

rights at work which made all the states to respect core labor standards. The second initiative was

the campaign at ILO and the UN for a Social Protection Floor which set a minimum level of

protection for the workers in all of the countries (Deacon, 2012 ).

This I believe was important in setting goals but there is still a doubt to what extent the countries

have implemented such measures.

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In order to enforce codes of conduct in several translational corporations a series of campaigns

have been instigated by the consumer and union groups. One of such activity was “Think

Globally and Punish Locally” where student activists rallied across college campuses in U.S

against Sweatshops for improving working conditions and labor rights in companies that supply

products to universities. It gave significance to profiting from ethical policies to many

corporations and businesses across U.S.

The codes of conduct are basically the set of principles to look into the behavior of transnational

corporations and their subcontractors with respect to their labor practices and environmental

policies. For eg, the code of ethics of the Levi Strauss jean corporation is repeated in union

literature as an indication of the TNC interacting with the labor union movement (ICFTU, 1996a,

p. 59). Levi Strauss is noteworthy not only for its code of ethics banning abuse of labor, but also

for its withdrawal in 1992 from states practicing severe modes of repressive industrial relations,

such as Burma and China.

Strategy used to highlight the abuse of labor rights:

One influential strategy, a marketing strategy perhaps, is to select a severe violation of workers'

rights, expose violations in the media and continue to pressurize the government to legislate,

customers to boycott and corporation to change their code of conduct. One such example

includes the campaigns against the child labor and labor conditions in South-East Asia toy

factories and manufacture of footballs in Pakistan. Prior to 1996 European Football

Championships, FIFA endorsed the balls made in Pakistan using a child labor. The cooperation

between British, Pakistani and Norwegian camera crew made this adverse publicity allow FIFA
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adopting new code of practice giving more attention to labor issues revolving around sporting

events.

The pressure from organized labor and consumer groups in developed countries forced the

government to take action. For example, in April 1995, US president Bill Clinton announced a

voluntary code of conduct covering business ethics and workers’ rights for US companies

working abroad. This was designed to make businesses abide by internationally agreed

principles on human rights, labor standards, environmental protection and anti-corruption.

Conclusion:

After analyzing various incidents of abuse of labor rights, claims of transnational corporations

and several states of following code of conducts to protect labor rights, I believe that the

workers’ rights are not being adhered to and there is still a long way and struggle needed to

completely safeguard the workers in different parts of the world, be it developed or developing.

The global products today pass through so many supply chains through the world that it is

difficult to know the labor and environmental conditions in which these products are traded and

manufactured. Citing my personal experience of football manufacturing in Pakistan, Sialkot,

even after government and FIFA putting regulations on child labor , I have witnessed a lot of

children still being used to manufacture footballs and which are one of the best produced.

Moreover, I interned in a textile manufacturing factory and I have seen a lot of labor laws being

violated, like discrimination with respect to designation, extremely poor working condition with

no cleanliness etc , in the name of incentives which the executives’ happily over look

irrespective of what the worker has to go through.

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References:

Burtless, G. (2001). Workers’ Rights: Labor standards and global trade.

Nelson Lichtenstein, R. A. (2016 ). Achieving Workers' Rights in the Global Economy.

Robert O'Brien, M. W. (2016). Global Political Economy.