CETA: Trading Away Democracy

thumb.phpFirst published by the Corporate Europe Observatory.

On September 26th, 2014, Canada and the European Union (EU) announced the conclusion of a far-reaching economic integration agreement, the Comprehensive Economic and Trade Agreement (CETA). The agreement includes an investor-state dispute settlement (ISDS) mechanism, which could unleash a corporate litigation boom against Canada, the EU and individual EU member states, and could dangerously thwart government efforts to protect citizens and the environment.

The ISDS mechanism gives foreign corporations the ability to directly sue countries at private international tribunals for compensation over health, environmental, financial and other domestic safeguards that they believe undermine their rights. These investor-state lawsuits are decided by private commercial arbitrators who are paid for each case they hear, with a clear tendency to interpret the law in favour of investors.

ISDS can prevent governments from acting in the public interest both directly when a corporation sues a state, and indirectly by discouraging legislation for fear of triggering a suit. Globally, investors have challenged laws that protect public health such as anti-smoking laws, bans on toxics and mining, requirements for environmental impact assessments, and regulations relating to hazardous waste, tax measures and fiscal policies.

Key findings of the report:

1) Canada’s experience with the North American Free Trade Agreement (NAFTA) illustrates the dangers of investment arbitration. Under NAFTA, Canada has been sued 35 times, has lost or settled six claims, and has paid damages to foreign investors totalling over C$171.5 million. Ongoing investor claims challenge a wide range of government mea- sures that allegedly diminish the value of foreign investments – from a moratorium on fracking and a related revocation of drilling permits to a decision by Canadian courts to invalidate pharmaceutical patents which were not sufficiently innovative or useful. Foreign investors are currently seeking several billions of dollars in damages from the Canadian government.

2) CETA’s investor protections would arguably grant even greater rights to foreign investors than NAFTA, increasing the risk that foreign investors will use CETA to constrain future government policy:

  • By protecting investors’ “legitimate expectations” under the so-called “fair and equitable treatment” clause, CETA risks codifying a very expansive interpretation of the clause that would create the “right” to a stable regulatory environ- ment. This would give investors a powerful weapon to fight regulatory changes, even if implemented in light of new knowledge or democratic choice.
  • CETA would give foreign investors more rights to challenge financial regulations than NAFTA, where they were mostly limited to a bank’s (still wide-ranging) rights to transfer funds freely and to be protected from expropriation. CETA expands their rights to include highly elastic concepts such as fair and equitable treatment, which threatens to hamstring regulators charged with protecting consumers and the stability of the financial system in an emergency.

3) The risks to Canada of being sued by banks, insurers and holding companies will increase significantly with CETA. These risks are evident as speculative investors, backed by investment lawyers, are increasingly using investment arbitration to scavenge for profits by suing governments experiencing financial crises. EU investment stocks in Canada are significant in the financial sector, which would gain far-reaching litigation rights under CETA.

4) CETA would increase the risk to the EU and its member states of challenges by Canadian investors in the mining and oil and gas extraction sectors. Canadian investment stocks in the EU are significant in these sectors, and Canadian mining companies are already engaged in a number of controversial natural resource projects across the EU. Mining specialists are celebrating CETA as a “landmark” agreement, which could have “major implications for miners.” Oil, mining and gas corporations around the world are increasingly turning to investment arbitration.

5) Canadian subsidiaries of US-headquartered multi- nationals will also be able to use CETA to sue European governments, even if the EU eventually excludes or limits investor-state dispute settlement within the Transatlantic Trade and Investment Partnership (TTIP) currently under negotiation with the US. This is particularly worrying for Europeans as US corporations dominate the Canadian economy. EU-based subsidiaries of foreign companies would also have the same power to challenge measures in Canada.

6) EU, Canadian and US companies are already among the most frequent users of investment arbitration, so there is every reason to expect that they will use CETA to rein in government measures in Canada and Europe. Fifty-three percent (or 299) of all known investor-state disputes globally were brought by investors from the EU. U.S. investors have filed 22 percent (or 127) of all known investor-state cases. Canadian investors are the fifth most frequent users of investment arbitration.

7) Opposition to investor-state provisions in CETA is growing on both sides of the Atlantic amongst civil society organisations, trade unions, and even EU member states. In response, the European Commission and the Canadian government have begun a misleading propaganda effort aimed at downplaying the risks of investment arbitration and diverting attention from the fundamental problems of the system by focusing on cosmetic reforms.

8) The “reforms” that the European Commission and the Canadian government have promised to dispel concerns about ISDS will not prevent abuse by investors and arbitrators. On the contrary, CETA will significantly expand the scope of investment arbitration, exposing the EU, its member states and Canada to unpredictable and unprecedented liability risks.

There is no need for the creation of a special legal regime to protect foreign investors, especially in stable jurisdictions like the EU and Canada. Today’s multinationals are amongst the most successful and sophisticated in the world, capable of evaluating risk and the expected returns on that risk. Should the risk be too great, options such as regular courts, private insurance and public investment guarantee schemes are all readily available to them.

Trading Away Democracy calls on legislators in Canada and the EU to reject the investment protection provisions in CETA and in future treaties, including the controversial EU- US Transatlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP).

Read the full report in English, German and French.

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France Says “Non” To ISDS in TTIP – No Deal In 2015

stop_ttip_foto_ecoblog_itFrom EurActiv.com

Matthias Fekl, France’s Secretary of State for Foreign Trade, has said that France will not support the inclusion of the Investor State Dispute Settlement mechanism (ISDS) in a potential TTIP agreement. The ISDS is a point of heated debate between the EU and the United States.

Europe’s fears over the Transatlantic Trade and Investment Partnership (TTIP) are not abating, while America is beginning to show signs of impatience. Europe and the United States have reached a standoff in the TTIP negotiations, over the question of the Investor State Dispute Settlement. This mechanism could give companies the opportunity to take legal action against a state whose legislation has a negative impact on their economic activity.

“France did not want the ISDS to be included in the negotiation mandate,” Matthias Fekl told the French Senate.

“We have to preserve the right of the state to set and apply its own standards, to maintain the impartiality of the justice system and to allow the people of France, and the world, to assert their values,” he added. German opposition to the ISDS mechanism is also very strong.

The German Minister for Economic Affairs has often expressed his support for the trade deal with the United States, on the condition that it does not include the ISDS. The disagreement over the ISDS has caused negotiations to stall. “The year 2014 did not see any great advances in the transatlantic agreement,” Fekl said during a speech to the French Senate.

In Brussels, the EU’s position on the Investor State Dispute Settlement mechanism became clear after the appointment of the new team of EU Commissioners. In his speech to the European Parliament on 22nd October, the new Commission President Jean-Claude Juncker said he would not accept any external limitations being placed on the member states’ ability to settle their own industrial disputes.

Commission mulls TTIP minus investor arbitration

Negotiators from the United States are trying to move the talks forward, despite reluctance from the European Union. During a visit to the European Parliament’s October plenary session in Strasbourg, Anthony Luzzatto Gardner, from the United States’ mission to the EU, insisted that the ISDS was an important clause in the TTIP negotiations.

“Our message to the people of Europe is not to remove it from the table, but to conclude the discussion process and to improve it,” he said.

“Removing the ISDS from the negotiations would give off a very bad signal. It would clear the way for the removal of other chapters of the negotiations,” he added. The American negotiators are beginning to show frustration at the demonisation of these arbitration tribunals.

“Investor State Dispute Settlements have never been, and will not be, a way for businesses to challenge legislation they do not agree with,” an American negotiator said in Paris.  

Commission swamped by 150,000 replies to TTIP consultation

The next cycle of negotiations is due to take place in December.

The European Commission’s mandate for the TTIP negotiations was set by the member states, and the American negotiators will have to satisfy not only the Commission, but also the national parliaments of the EU if an agreement is to be reached.

In France, Matthias Fekl reminded the Senate that the Transatlantic Trade and Investment Partnership was “a mixed agreement”. “It is the parliamentarians who will have the last word when the agreement is finalised,” he said, adding “I don’t think will be any time soon”.

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Workers of the world unite against the new generation of trade deals

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David Cameron’s ringing endorsement at the G20 of the proposed EU-US trade deal, the Transatlantic Trade and Investment Partnership (TTIP), was perhaps predictable but also has opened up the topic of TTIP and its like to greater public awareness. Until Brisbane discussion of this new generation of multi-lateral trade agreements was very much a topic for aficionados.

From opening up TTIP to public debate we can hopefully unspin the web of secret negotiations that are taking place more or less across the planet that are seeking to bind the peoples of the world into an all-encompassing corporate friendly, neo-liberal settlement.

As well as TTIP, currently the Labour movement should also be concerned about the proposed EU agreement with Canada, CETA; a multilateral agreement on trade in services, TISA; and, a parallel deal that the US is trying to construct in the Pacific Basin, with the exclusion of China, TPP.

The treaties are at different stages in the negotiations with CETA being initialled in Ottawa quite recently; TPP apparently open to some bi-partisan deal between the Republicans and a lame duck President Obama and Cameron promising to put “rocket boosters” behind the TTIP negotiations.

How important are these treaties? If successful the TTIP zone would cover a region accounting for 60% of global GDP, 33% of world trade in goods and 42% of world trade in services. The 12 countries negotiating TTP account for 40% of global GDP. Even accounting for the overlap of the US being included in both sets of figures these treaties indicate a global reach that could tie the world’s economies to a system outside, as becomes apparent, the control of national governments.

As far as the responsible EU Commissioner, Celia Malmstrom, is concerned CETA, after two years of legal scrubbing, is a ‘done deal’. That, however, remains to be seen. In the EU it seems to be an unresolved but important political and legal point to establish if the treaties may be defined as a “mixed agreement” or not. A ‘mixed agreement’ would have to be referred to all 28 members states for ratification (no problem for Cameron’s coalition presumably).

The outgoing Commission strenuously tried to avoid allowing the treaties to be so described but in the confusion that has surrounded the appointment of the new Commissioners, Malmstrom has said that TTIP is a ‘mixed agreement’ and that maybe the status of CETA is not final. Commission President, Jean-Claude Junkers has moved to reverse or limit Malmstrom’s opinion.

The Canadian unions are not happy with the way that CETA has been handled. Larry Brown, National Secretary-Treasurer of the National Union of Public and General Employees, said at the time of the initialling:

During negotiations we were told that the process was secret and that Canadians couldn’t see the text or have input into the agreement, now they have what they claim is final text and we are told it is not open to discussion or debate. This is an outrageously undemocratic process for an agreement that will have wide-ranging consequences for all Canadians.”

In the run up to Brisbane the International Confederation of Trade Unions and the ‘host’ national federation, the Australian Council of Trade Unions called for a halt to the TTP negotiations. The ICTU General Secretary, Sharan Burrow, said:

Although it seems that a labour chapter with a certain degree of enforceability will be part of the TPP, if ever agreed, we felt that this would not be enough to endorse the TPP … Besides, the labour chapter … does not cover all core labour standards and sub-national labour law is not within the scope of the agreement. More to this, practical experience has shown that governments are reluctant to use labour chapters. This is not to say we do not support a labour chapter, but that TTP’s and other future trade agreement’s impact on workers need to be considered as a whole” (my emphasis).

Examples of these wider issues contained within TPP, which almost always are features of the new generation of trade treaties (including CETA and TTIP), are:

  • a quasi-legal procedure to make governments submit to Investor State Dispute Settlement (ISDS) whereby investors can sue governments over a wide range of policies, including environmental and social policies
  • severe restrictions on governments’ ability to make national laws for public health, safety and general welfare with a ‘regulatory coherence’ chapter
  • stopping governments from giving priority to public policy aims when making decisions about public procurement.

Meanwhile in the US, lame duck President Obama is working on his legacy which seems to be delivery of TTP and possibly TTIP. There is a possibility that the new Republican majority in Congress will help him deliver on one, maybe two, of the treaties. The Republican Senator, Mitch McConnell, has already made the point that maybe the trade treaties are one area at least that the President and Republicans make find common cause.

This unlikely alliance will do this by passing a Trade Promotion Authority (TPA) that will give the President an ability to bring one or both treaties that he and his team have negotiated to Congress, which will vote for or against it but will not be able to amend it. If the Republicans can get possibly six Democrats to switch Obama is in with a shout of getting TPP or less likely TTIP through. Congress would be asked to vote for the TPA before it knew the terms of TPP or TTIP!

The US unions have this month launched a major campaign against ‘fast track’ as the TPA is known, including video advertisements showing in the metro station used by all presidential and congressional employees.

Celeste Drake of the US union federation, the AFL-CIO, makes the telling point that all of the trade deals that have benefited corporate American – but not American labour – have all been pushed through Congress under ‘fast track’ – North American Free Trade Agreement, World Trade Organisation, Central American Free Tarde Agreement, the US-Colombia Free Tarde Agreement, the US-Korea agreement. NAFTA displaced 700,000 manufacturing jobs and has helped drive wages down. The WTO deal that allowed entry to China has cost US workers $37 billion is lost wages in a single year (2011)

The President of the Communication Workers of America, Larry Cohen, says:

US companies and multinational corporations can’t wait to move our remaining manufacturing jobs to a nation where the government will protect multinational investment. Then, US and other workers will be told to compete with wages half the rate of Mexico, Central America and China … if any of the TPP nations improves worker rights … a multinational corporation can sue in a secret arbitration tribunal for any loss of future profits die to legislative action.”

The legal action against nations that Cohen raises is the very thing that Cameron pooh-poohed in his Brisbane speech “we’ve signed trade deal after trade deal and it’s never been a problem.”

It’s not a problem if you ignore this – by the end of 2013 the number of known ISDS cases had reached 568, the number of countries that have been respondents in at least one case has increased to 98, with three quarters of cases brought against developing and transition economies (Latin America and the Caribbean account for the largest share), but EU countries ranked third as respondents with 21% of all cases.

The ISDS has become the major issue in Europe; to which in the UK can be added the future of the NHS. On the NHS Cameron in Brisbane said:

Some people argue in some way this could damage the NHS. I think that is nonsense. It’s our National Health Service. It’s in the public sector. That’s not going to change. It will remain free at the point of use.”

It is a commonplace that the majority of tendered NHS services are being awarded to the private sector, a creeping privatisation of the NHS. Agreements such as TTIP effectively ‘lock-in’ privatisations and make it extremely difficult to restore services to the public sector once transferred to the private sector.

The EU has previously had what is called a ‘positive list’ approach in free trade agreements, where those sectors specifically mentioned are the sectors opened up to liberalisation and corporations. CETA adopts a ‘negative list’ approach where the free trade agreement applies to all sectors apart from those sectors specifically listed for exclusion – hence the ‘list it or lose it’ label.

This is understood to be the approach in TTIP and Cameron has not chosen to ‘list’ the NHS to exclude it from the provisions of the treaty, as, for example, the French have ‘listed’ to given protection to their cinematography industry. As Unite’s Len McCluskey has said:

Why doesn’t David Cameron just make an explicit commitment to use his veto in Europe to get the NHS out of TTIP?”

ISDS within TTIP is proving to be major problem for the European Commission. When the Commission opened a public consultation on ISDS a remarkable 150,000 European citizens responded, the overwhelmingly majority against ISDS.

However, even if the ISDS clauses were removed it is open to speculation about how effective that may be. Most US corporations have subsidiaries in Canada, if CETA is indeed a ‘done deal’ surely EU governments could be used by US Canadian subsidiaries as, for example, Australia is being sued by a Philp Morris subsidiary over cigarette plain paper packaging, this before TPP is signed, as a result of a previous bilateral deal signed by Australia.

There is a whole separate discussion about the issue of labour rights. Where under TTIP European workers and their unions would fear any ‘regulatory coherence’, code for levelling down, around US standards. Republicans have warned against using TTIP to smuggle into the US Euro-style labour rights. Conversely with TPP, it is the US that has the higher standards and US workers and their unions would fear ‘regulatory coherence’ with South East Asia.

Many UK unions welcome the filing of a lawsuit by the Stop TTIP Alliance with the European Court of Justice to stop TTIP on the grounds of secrecy and ISDS, but the case could take a year and half to be heard.

More immediately, activists could sign the self-organised European Citizens Initiative on TTIP.  Usually under the European Citizens’ Initiative if a petition of 1 million signatures from at least 7 member states is presented to the Commission it will be referred for debate in the European Parliament. Outrageously, the Commission has declared that TTIP is exempt from the ECI hence the self-organised campaign.

The UK unions are lined up against TTIP through a TUC Congress motion calling for ‘outright opposition’ to TTIP. Civil society organisation are ranged against TTIP. The unions and the civil society organisations are allied in the #noTTIP campaign. All that remains is to shift the Labour Party in our direction.

Adrian Weir is Assistant Chief of Staff at Unite the union and an officer with the activist group Campaign for Trade Union Freedom

This blog first appeared on the Left Futures website.

 

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ECHR Article 4: Prohibition of slavery, servitude, forced and compulsory labour

UnknownBy Virginia Mantouvalou, Reader in Human Rights and Labour Law and Co-Director of the Institute of Human Rights; UCL, Faculty of Laws

Article 4 of the ECHR prohibits some of the worst forms of labour exploitation. It says that no one should be subjected to slavery, servitude, forced and compulsory labour. The prohibitions contained in the provision are absolute, in the sense that the protection of workers cannot be limited for reasons of economic efficiency, national security or other such purposes. The provision only allows a limited number of exceptions, exhaustively enumerated (compulsory military service, prison labour, service in case of emergency threatening the life of the nation or work that is part of normal civic obligations).

Until a few years ago, Article 4 may have seemed out of date, as most people would assume that we do not have this type of extreme exploitation nowadays, at least not in Europe. Since 2005, a line of judgments of the European Court of Human Rights (Court or ECtHR) have shown that Article 4 is sadly relevant today in the UK and in Europe. The Court has accepted that vulnerable workers, like migrant domestic workers, are sometimes prone to serious exploitation that was classified as ‘servitude’ (Siliadin v France, App No 73316/01, Judgment of 26 July 2005). Domestic workers are vulnerable for numerous reasons, such as the fact that they work in the privacy of the employers’ household and that they are often migrant, so there may be language barriers too. They are also excluded from much labour protective legislation, and are therefore in a situation of ‘legislative precariousness’. There are several examples in the press and in case law, which show how unscrupulous employers exploit domestic workers by, for example, withholding their passports (see, for instance, H Khaleeli, ‘How Domestic Workers Become Slaves’, The Guardian, 6th August 2010; Siliadin, as above).

The case law of the Court post-2005 has imposed a number of positive obligations to state authorities for situations of grave labour exploitation. For example, the authorities have to criminalise employers’ conduct, which can be classified as servitude or slavery; they have an obligation to investigate allegations of abuse, when these come to their attention; they must prosecute the employers who take advantage of the workers’ vulnerability.

In fact in 2012, the ECtHR said that the UK violated Article 4 in the case of a migrant domestic worker, exactly because the authorities did not investigate properly her allegations of abuse (CN v UK, App No 4239/08, Judgment of 13 November 2012). Similar state obligations to legislate and enforce the law exist in situations of trafficking for sexual exploitation: human trafficking has to be criminalized; legislation must also be properly enforced through investigations by the authorities when there is suspicion of trafficking; and immigration rules should not be too restrictive so as to allow employers to exercise a great degree of control over the worker (Rantsev v Cyprus and Russia, App. No. 25965/04, Judgment of 7 January 2010).

Enforcement of the law in this area is extremely difficult because victims of serious labour or sexual exploitation are very often hidden (domestic workers in private household that cannot be accessed by labour inspectors).

The UK Government is currently in the process of preparing a Draft Modern Slavery Bill, which is supposed to place the country at the forefront of the fight against ‘modern slavery’. So it is of fundamental importance that the UK remains bound by the Convention. It is vital that the ECtHR, which has developed key principles in the area of article 4, constantly assesses compliance with the duties of the authorities for cases of labour exploitation.

But aspects of domestic law have flaws. Of particular concern in this context is the Overseas Domestic Worker visa regime, which is in force since 2012. This visa ties domestic workers to the employers with whom they entered the UK. It makes them in this way uniquely vulnerable to abuse because they cannot change employer even if they are seriously exploited or abused. The control that the employers exercise on these workers may therefore raise questions under Article 4.

A separate but related issue involves the rights of undocumented migrants. In English law, because the contract of these workers is illegal, they are not entitled to protection of their contractual rights, but are entitled to protection against discrimination claims, when the worker may have been victim of human trafficking, as defined, inter alia, in Article 4 case law of the ECtHR (Hounga v Allen and Another [2014] UKSC 47 on appeal from [2012] EWCA Civ 609). The so-called doctrine of illegality in relation to contractual claims, though, might still raise issues under article 4, because it gives the employer great power to exploit the worker.

Article 4 is also an important safeguard against exploitation of workers that participate in workfare schemes. These are schemes that make social benefits, like a jobseekers’ allowance, conditional upon acceptance of suitable work.

The ECtHR has decided a few cases on this type of arrangements, looking at whether they constitute forced labour. For a form of labour to be considered forced, it must be imposed against the will of the person and under the threat of a penalty (Van der Mussele v Belgium, App No 1989/80, Judgment of 23 November 1983). The Court has said that it may be legitimate for the government to ask that someone who claims an unemployment benefit has first tried to obtain a job. When a state has a welfare system, it is entitled to set conditions on the receipt of benefits: a condition that one seeks ‘generally acceptable employment’ is not unreasonable. This is particularly so when there is a possibility to reject work that is socially unacceptable or the possibility of conscientious objection (Schuitemaker v Netherlands, App No 15906/08, Decision of 4 May 2010).

The UK Supreme Court that has examined a claim on workfare schemes ruled that it does not constitute forced labour (R (on the application of Reilly and another) (Respondents) v Secretary of State for Work and Pensions (Appellant), [2013] UKSC 18), even though it found it unlawful for other reasons. Yet it is not unimaginable that a workfare scheme can go too far and violate the Convention, if for example the job that a jobseeker is required to perform is not generally acceptable, because of very harsh working conditions. The protection of individuals under the prohibition of servitude, forced and compulsory labour, can serve as a guarantee: if a workfare scheme does go too far, there will be judicial supervision at supranational level.

Because article 4 is about the worst forms of labour exploitation – a labour right that is undoubtedly a human right too – it is a crucial safeguard for workers. Withdrawal from the Convention would mean that both Government and private employers could remain unaccountable for serious labour exploitation. Labour exploitation is something that no liberal state should either engage in or tolerate.

This blog first appeared on the Institute of Employment Rights Website.

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Implications of withdrawal from European Convention On Human Rights on employment law

Unknown-1By Michael Ford QC, Old Square Chambers

Article 8 of the Convention protects the right to private life. Conservative conceptions of this right see it as restricted to matters such as freedom of thought, the protection of property (especially the home) against state intrusion and, above all, the right to engage in market transactions. The Court of Human Rights (“ECtHR”), however, has resisted such a narrow conception. Starting with its ruling in Niemitz, it has consistently held that the right is not restricted to an “inner circle” but also extends to encompass the right to form and develop relationships with other human beings, including with colleagues at work.

Articulated in this way, the right in Article 8 has the potential to protect against practices which interfere with working life in the broad sense. It may apply where an employer engages in secret monitoring of a worker’s telephone calls or e-mails in the workplace (Halford v UK). Combined with Article 10 on freedom of expression, it may prevent refusals to recruit owing to political views or activities (see e.g. Sidabras v Lithuania).

It protects against decisions to dismiss on the ground of a person’s sexuality, exemplified by the ruling that the UK’s ban on gay people serving in the military infringed Article 8 (Smith v UK). Where a choir master was dismissed by a Catholic church for having an extra-marital affair and would find it especially difficult to find a job outside that church, for example, Article 8 required that the German domestic courts balanced the choir master’s family life with his unmarried partner against the interests of the church, without according overriding weight to the interests of the church (Schuth v Germany).

The recent decisions in Volkov v Ukraine and Affaire IB v Grèce equally demonstrate the potentially significant effect of Article 8 on UK unfair dismissal law. In Volkov the ECtHR wasted little time in deciding that the dismissal of a judge from office engaged Article 8: dismissal from office affected a wide range of his relationships with other persons, including professional relationships, as well as affecting his “inner circle” because of its consequences for his material well-being and his family; it also affected his professional reputation. Because his dismissal was not in accordance with domestic law, it was unlawful under Article 8.

In IB v Grèce, unfortunately only available in French at present, IB was employed in a jewellery factory. After he told three colleagues that he thought he was HIV positive, the employer received a letter from 33 employees asking that it dismiss IB to protect their health. In fact there was no health risk to other employees from working with IB, but the employer still dismissed him. His legal action against his employer failed before the Greek courts and so he applied to the ECtHR.

The Greek government argued that Article 8 was not engaged because IB was not prevented from working but only dismissed from a particular job. It relied, too, on the complaints of IB’s colleagues to justify his dismissal. Rejecting these arguments, the ECtHR held that the dismissal had serious effects on IB’s private life, stigmatising a person with no symptoms. Although he had managed to find another job this did not, the ECtHR said, erase the damaging effects of his dismissal. Nor could the decision to dismiss him be justified by the employer’s interest in calming the problems in the workplace.

In particular, it was unclear what would have happened if the appeal courts in Greece had made clear that it was not permissible to dismiss HIV positive employees based on false beliefs. The ECtHR awarded IB his lost wages since dismissal and compensation for injury to feelings.

These decisions show, then, that Article 8 will normally apply to the decision to dismiss someone from a single post (and not only to complete bans on working). As shown most clearly shown by Volkov, a “normal” dismissal often has serious consequences for an individual’s relationships at work, material welfare and reputation. If so, it must meet the relatively strict test of justification in Article 8(2).

To date the domestic tribunal courts have not been very good at translating Article 8 into UK law: Volkov v Ukraine and IB v Grèce shows they may have to change their attitude.

Though these are uncharted waters, the cases point to the following challenges to domestic law and practice. First, what if a dismissal protection affects someone’s private life, well-being and reputation (as in Volkov) but the employee has no right even to claim unfair dismissal (e.g. because he or she has insufficient service)? How could it then be said that a dismissal was justified when it relies on simply giving notice of dismissal or payment of damages in lieu of notice – non-existent or irrelevant remedies? Second, the decisions may prevent employers simply relying on prejudice, “common sense” (for which read what the employer thinks) or wrong views to justify the fairness of a dismissals.

More radically still, third, they point to a greater degree of scrutiny of employers decisions, based on the European tests of necessity and proportionity, rather than what is traditionally required by the very weak “range of reasonable responses” test in unfair dismissal. Fourth, they may be used to challenge the low levels of compensation, now capped at one year’s salary, and the irrelevance in practice of the remedies of reinstatement and re-engagement: how can such weak remedies provide an effective remedy for an infringement of Article 8.

This blog first appeared on the Institute of Employment Rights website.

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TTIP: European Disintegration, Unemployment and Instability

By Jeronim Capaldo
GDAE Working Paper 14-03
October 2014

According to its proponents, the Trans-Atlantic Trade and Investment Partnership will stimulate growth in Europe and in the US. Projections endorsed by the European Commission point to positive, although negligible, gains in terms of GDP and personal incomes. In a paradox, these projections also show that any gains in Trans-Atlantic trade would happen at the expense of intra-EU trade reversing the process of European economic integration.

Furthermore, recent literature has pointed out several problems in the most influential assessment of the TTIP’s effects. Projections by different institutions have been shown to rely on the same Computable General Equilibrium model that has proven inadequate as a tool for trade policy analysis.

In this paper we assess the effects of TTIP using the United Nations Global Policy Model, which incorporates more sensible assumptions on macroeconomic adjustment, employment dynamics, and global trade. We project that TTIP will lead to a contraction of GDP, personal incomes and employment. We also project an increase in financial instability and a continuing downward trend in the labor share of GDP.

Evaluated with the United Nations model, TTIP appears to favor economic dis-integration, rather than integration, in Europe. At a minimum, this shows that official studies do not offer a solid basis for an informed decision on TTIP.

Download the The Trans-Atlantic Trade and Investment Partnership: European Disintegration and Other Consequsences

Download the Executive Summary

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Unite’s TTIP Action Alert

TTiP action alert

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ITUC Calls For Halt To TPP Negotiations

ITUC General Secretary Sharan Burrow calls for a halt to TPP Negotiations

ITUC General Secretary Sharan Burrow calls for a halt to TPP Negotiations

The International Trade Union Congress has called for negotiations on a new trade agreement between the USA and nine Pacific Rim countries to be brought to a halt.

In a statement issued by Sharan Burrow, the General Secretary of the ITUC the ITUC said in consultation with trade union centres from TPP (Trans-Pacifice Partnership) countries called for negotiations to stop and seek for a new mandate that puts people and the planet first.

The ITUC said: “Although it seems that a labour chapter with a certain degree of enforceability will be part of the TPP, if TPP is ever agreed, we felt that this would not be enough to endorse the TPP. Indeed, the TPP establishes an ISDS, stricter IP protection, (de)regulatory coherence and other concerns explained below in our release and the letter. Besides, the labour chapter (as it stands now on the negotiation table) does not cover all core labour standards and sub-national labour law is not within the scope of the agreement. More to this, practical experience has shown that governments have been reluctant to use labour chapters. This is not to say that we do not support the labour chapter, but that TPP’s and any other future trade agreement’s impact on workers need to be considered as a whole”.

Together with the ITUC, the national trade union centres that support this call are: Australia, ACTU; Canada, CSN and CSD; Japan, JTUC-RENGO; Mexico, UNT; New Zealand, NZCTU; Peru, CUT and CATP; United States, AFL-CIO. Some of these trade unions, as well as the unions of Chile (CUT-Chile) and Malaysia (MTUC) had asked for the negotiations to stop at an earlier stage.

“TPP Trade Talks Must Stop”

 The ITUC has called on governments to stop negotiations on the “Trans-Pacific Partnership” agreement, criticising the secrecy and corporate bias in the current negotiations.

Sharan Burrow, ITUC General Secretary, said: “This secretive trade deal is good for some multinational corporations, but deeply damaging to ordinary people and the very role of governments.  Corporate interests are at the negotiating table, but national parliaments and other democratic actors are being kept in the dark.  What we do know, much of it through leaks, is that this proposed deal is not about ensuring better livelihoods for people, but about giving multinational companies a big boost to profits.  Governments should shut down the negotiations, and not re-open them unless they get genuine and transparent public mandates at home that put people’s interest in the centre.”

 The current TPP proposals include provisions which would:

  • Make governments submit to so-called investor to state dispute settlement (ISDS) procedures whereby investors can sue governments on a wide range of policies, including environmental and social policies ;
  • Introduce patent protections that would boost pharmaceutical companies’ profits, but put vital medicines out of reach for millions of poorer people;
  • Severely restrict governments’ ability to make national laws for public health, safety and general welfare with a ‘regulatory coherence’ chapter;
  • Stop governments from giving priority to public policy aims when making decisions about public procurement;
  • Impose a series of restrictions on governments’ abilities to regulate the financial sector, thus holding back efforts to reform damaging financial speculation and impeding governments from taking measures to maintain their balance of payment.

Proposals for protection of workers’ rights have met with heavy resistance from some countries, and appear to not cover all ILO Conventions that establish Fundamental Rights at Work or subnational (state and province) labour legislation.  The proposals also contain no enforcement for environmental provisions, and fail to address the need for action to mitigate climate change.

“A fair and open global trading system is essential to prosperity, but this proposed TPP is nothing of the sort.  Global and regional trade needs to create jobs and prosperity for the many, not just provide welfare for corporations and transfer more power from the parliaments to the boardroom,” said Burrow.

 National trade union centres in the countries negotiating the TPP are today formally calling on their governments to stop the negotiations, and to seek a proper negotiation mandate if they are to engage in the negotiations again. Continue reading

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How Fast Track Works! Why We Don’t Want A Fast Track Trade Deal: It Will Lower Wages

Put-the-Brakes-on-Fast-Track_issuebannerFrom the AFL-CIO Website, by Celeste Drake

You may have heard that Fast Track has helped depress wages for America’s workers over the past 20-plus years. How does it do this?

Fast Track is a trade policy in which Congress cedes its accountability over trade policy (the Constitution calls it “regulat[ing] Commerce with foreign Nations”) to the executive branch and promises to advance the trade deals the executive branch brings back in an accelerated process that allows no amendments and very limited debate.

On the one hand, it may make some amount of sense to delegate negotiating authority to the executive branch. I mean, really, can you imagine simultaneously flying 435 representatives and 100 senators all over the world to negotiate trade deals? I know, I know, some people think it would be an improvement to get Congress as far away from Washington as possible, but let’s be practical: 535 people (and their aides) on a negotiating team?

However, the accountability that Congress gives up when it tells the executive branch to go negotiate an agreement makes no sense at all. Instead of setting up mandatory negotiating goals—and requiring the executive branch to demonstrate it has achieved those goals before sending the trade agreement to Congress for a vote — Fast Track includes “negotiating objectives,” which the executive branch should only “make progress” toward. And there is no independent evaluation that requires the executive branch to meet even that low bar.

Yup. It’s true: Under Fast Track, Congress cedes its authority without guaranteeing that Americans get a good trade deal in return.

As a result, the executive branch has repeatedly sent bad deal after bad deal to Congress: the North American Free Trade Agreement (NAFTA), the World Trade Organization (WTO) talks, the Central American Free Trade Agreement, the U.S.-Colombia Free Trade Agreement, the U.S.-Korea trade agreement, just to name a few. And they’ve all passed under Fast Track.

And workers have paid the price for these bad trade deals: The Economic Policy Institute (EPI) has determined that net job displacement since China entered the WTO in 2001 cost the U.S. economy $37.0 billion in lost wages in 2011 alone! And the impact has not been equal—it has displaced a disproportionately large number of good jobs for minority workers—958,800 good jobs with excellent benefits, 35% of total jobs displaced.

And it’s not just the WTO that has harmed U.S. workers. NAFTA has displaced nearly 700,000 jobs and has helped push wages down. As Jeff Faux writes:

“NAFTA strengthened the ability of U.S. employers to force workers to accept lower wages and benefits. As soon as NAFTA became law, corporate managers began telling their workers that their companies intended to move to Mexico unless the workers lowered the cost of their labor. In the midst of collective bargaining negotiations with unions, some companies would even start loading machinery into trucks that they said were bound for Mexico. The same threats were used to fight union organizing efforts. The message was: ‘If you vote in a union, we will move south of the border.’”

chart.jpg_imagelargeThis forced reduction in wages—to move U.S. wages closer to the wages paid in Mexico, where unions face severe and, in some cases, violent repression—combined with anti-union tactics has had long-term negative effects on the U.S. labor force. While the trend clearly started during the Reagan era, NAFTA and other Fast Track trade agreements have exacerbated, rather than fixed, the problem.

And now Congress wants to pass another Fast Track law to allow more Fast Track trade agreements?  Where is the evidence that these agreements have been good for working people? Where is the evidence that these agreements have grown the middle class? We must say no to Fast Track. The promises of NAFTA-style agreements have thus far not lived up to the hype. We have to fight for better policies that work for all of us—not just the 1%.

Intrigued? Read what other groups have to say about how Fast Track has undermined shared prosperity here,here and here.

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Holiday Pay Win For UK Unions

This week there was an historic ruling that workers in the UK are entitled to have overtime and other payments included in their holiday pay calculations.

The ruling attracted much media attention with some employers going into near panic, warning of lay offs and bankrupted companies.

The Government panicked and rushed into setting up a ‘task force’ to look at how to limit the impact of the ruling.

As many of us remember employers said the same thing about the national minimum wage and increased holidays emanating from the EU.

Some employers and employers bodies took the decision in their stride saying that they will comply with the ruling, get on with it and work with unions on the issue.

Howard Beckett, the legal director for Unite explains in the video that the ruling by the employment appeal tribunal to include overtime in holiday pay will not open the floodgates to historic payments.

The ruling comes after some workers who are contractually obliged to work overtime were receiving less than their normal wage in holiday pay.

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