TUC Response To EU Proposals For Multilateral Investment Court

The TUC has responded to the European Commission’s consultation on proposals for a multilateral court for investment agreements.  The TUC submission states that this proposal should be rejected due to the fact it would undermine domestic legal systems and pose significant threats to workers’ rights and public services, just as other international agreements on investment protection (like ISDS) have in the past.  Rather than develop a multilateral investment court system, the TUC calls for the EU to strengthen provisions in trade agreements to enforce fundamental labour rights and support the development of sound domestic legal systems in partner countries.

Introduction

The Trades Union Congress (TUC) is the national union centre of the UK.  The TUC has 50 affiliated unions, representing almost six million members, who work in a wide variety of sectors and occupations. The TUC welcomes the opportunity to respond to the European Commission’s consultation on multilateral reform of the investment court system as we have significant concerns about the proposed system.  The TUC objects to the nature of the Commission’s online consultation on the proposed multilateral investment system which is biased in favour of the proposal as it provides no opportunity for respondents to reject it. [1]

The TUC’s online response to the consultation should therefore be considered alongside this submission.

The TUC does not believe the European Commission should proceed with the proposal for a multilateral investment system as is not only unnecessary but would undermine the EU’s commitment to promote respect for labour rights and democratic systems of decision making.   Rather than develop a multilateral investment court system, the Commission should strengthen provisions in trade agreements to enforce fundamental labour rights and support the development of sound domestic legal systems in partner countries.

 Unnecessary

The TUC believes it is important for investors’ property rights to be respected. However we do not believe that foreign investors deserve additional rights established in a special body of law to claim compensation when they believe their property rights have been violated, as is proposed in the multilateral investment system.  The TUC believes domestic court systems should be used to resolve issues around property rights for both domestic and foreign investors.

If there is no functioning rule of law in certain countries, the domestic system will not be improved by establishing a parallel, democratically unaccountable multilateral court system that only protects foreign investors, such as that proposed by the European Commission.

The TUC believes the EU should work with potential trading partner countries to support the development of well-functioning, independent legal systems as part of its due diligence before undertaking trade negotiations.  Indeed the EU has undertaken to support such work by pledging to work towards the realisation of the UN Sustainable Development Goals which include a goal to create Peace, Justice and Strong Institutions (Goal 16).

If foreign investors choose to invest in countries where the rule of law is not yet established, the TUC believes they must bear the risk of this individually through private insurance.  Governments should not create parallel court systems to protect foreign investors’ rights as they come at the cost of undermining labour and social rights and the policy space of governments, as we highlight below.

 Chilling effect

The TUC believes that the additional rights given to foreign investors through the proposed multilateral investment system would pose a threat to governments’ ability to pass laws that protect workers and public welfare.

The TUC shares the concerns of the ETUC that the proposed multilateral court system does not plan to reform the rules of existing investment protection agreements.  As the terms of existing agreements contain broad definitions of what can be interpreted as ‘indirect expropriation’ and a breach of investors’ rights to ‘fair and equitable treatment’, the multilateral system will still provide scope for foreign investors to challenge legitimate legislation that promotes public welfare.  Existing investment protection systems have been used in such a way on numerous occasions in the past with damaging consequences for the countries involved.  Bolivia was sued by UK company Rurelac via Investment-State Dispute Settlement (ISDS) for nationalising its energy sector and ordered to pay the company $31 million in 2014.  Slovakia was sued by the Dutch health company Achmea via ISDS when it renationalised its health care system and ordered to pay €1.3 million in 2014. Meanwhile, the Italian diamond company Piero Foresti argued that South Africa’s laws to overcome the legacy of racial discrimination left by Apartheid constituted indirect expropriation and sued the government. As a result South Africa had to pay legal fees of over €5 million in 2015. These cases illustrate the serious cost to countries’ finances that result from cases brought by foreign investors through special court systems which mean governments have less resources to provide essential public goods such as health, education and infrastructure, or, indeed, support the creation of decent jobs.

Foreign investors’ use of ISDS in the past also indicates the dangerous chilling effect that the proposed multilateral court system may have over policy making. For example, New Zealand decided not to introduce plain packaging laws for cigarettes after Philip Morris launched an ISDS case against Australia for introducing similar laws.[2]

Indeed, the corporate law firm Cromwell Morris has advised its clients that investor protection in a trade agreement gives foreign investors ‘leverage to negotiate with the host government and cause it to change its behaviour more quickly.’[3]

We are concerned that the existence of an additional court system at the multilateral level will add to the pressure ISDS has brought to bear on governments not to pass policies in the public interest that might be challenged by foreign investors. These could include decisions to introduce additional protections for workers, raise the minimum wage or change the ways public services are run.

Unjust

The TUC does not believe it is just for foreign investors to be given access to a special court system to claim their rights that is not available to any other group, including domestic investors or workers.   As discussed above, granting additional rights to foreign investors through the creation of a multilateral investment system risks endangering workers’ rights further by creating a means for foreign investors to challenge laws that protect workers.

The TUC believes that rather than pursuing proposals for a multilateral investment system, the Commission should focus its energies on ensuring that workers are able to claim their fundamental rights to organise, collectively bargain and be treated decently.

The TUC welcomes the pledge made by the European Commission’s Trade for All strategy to ‘prioritise work to implement effectively the core labour standards (abolition of child labour and forced labour, non-discrimination at the workplace, freedom of association and collective bargaining), as well as health and safety at work in the implementation of FTAs and GSP.’ [4]

This supports the commitment by the EU to work towards the realisation of the Sustainable Development Goals which include a goal on Decent Work (Goal 8).

However, we are concerned that, at present, trade agreements do not contain measures to ensure labour standards are effectively enforced.  South Korea committed to respect core ILO standards in the EU-Korea free trade agreement. However, the agreement contained no mechanism for sanctions if labour rights were violated and trade unions were relegated by the agreement to a monitoring role. This meant they have had no power to trigger investigations when labour rights have been abused and while trade unions registered concerns in recent years with the Commission that labour rights, it has been up to the discretion of the Commission whether to take action. The TUC has been concerned by the fact the Commission has to date chosen to take no action to address labour violations in South Korea that have included the imprisonment of union leaders, excessive working hours and union busting. [5]

The ETUC and TUC have raised concerns that the labour chapter in the recently finalised EU-Canada (CETA) agreement adopts the same approach as the EU-Korea agreement.

Given the current inadequacies of labour chapters in trade agreements and the significant incidence of labour rights abuses in many countries the EU has trade agreements with – or is negotiating trade agreements with – it is imperative that the European Commission develop more effective means to enforce labour rights.

Justice dictates that the European Commission work to ensure that the rights of workers facing discrimination, abuse and exploitation are respected, rather than creating the proposed multilateral investment system which provides another means for already powerful investors to advance their interests and exposes workers to further harm.

[1] https://ec.europa.eu/eusurvey/runner/mutlilateralinvestmentcourt#

[2] http://www.italaw.com/sites/default/files/archive/costs-and-benefits-of-an-eu-usa-investment-protection-treaty.pdf

[3] https://www.crowell.com/NewsEvents/AlertsNewsletters/all/How-Mining-Companies-Can-Mitigate-Risks-and-Protect-their-Investments-Part-I-International-Investment-Agreements

[4] http://trade.ec.europa.eu/doclib/docs/2015/october/tradoc_153846.pdf

[5] https://www.ituc-csi.org/korean-unions-plan-national

Download pdf Multilateral reform of the investment court system consultation TUC final.pdf

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New Aussie Union Leader Takes Stand Against Anti-union Laws

Sally McManus, ACTU General Secretary

by Barry Camfield in Australia

Sally McManus has recently been elected Secretary of the Australian Council of Trade Unions, the first woman to hold the post.

In her message to Australian workers she argued: “
 the need to take on corporate greed and tackle inequality is urgent 
 The rules are not working for working people – that’s clear from the recent Fair Work ruling cutting penalty rates and the fact that jobs are being rapidly casualised 
 We are going to build and lead a movement to change the rules and bring fairness back to Australia.”

She expanded on this theme in a radio interview: “”I believe in the rule of law, when the law is fair and the law is right 
 But when it’s unjust, I don’t think there’s a problem with breaking it 
 It might be illegal industrial action according to our current laws, and our current laws are wrong 
 It shouldn’t be so hard for workers in our country to be able to take industrial action when they need to.”

She was immediately attacked by the leadership of the Liberal (Conservative) Party which sought to drive a wedge between the unions and the Labor Party by calling on Labor to distance itself from the unions (which it did).

Ms McManus came back fighting, making the case against the anti-union laws: “Australia has been built by working people who have had the courage to stand up to unfair and unjust rules and demand something better 
 There is rampant lawlessness in the workplaces of Australia and this is occurring in the form of chronic underpayments of workers, exploitation of visa workers and workplace that put safety and lives of people at risk 
 Australian unions are committed to changing the laws at work because they are no longer strong enough to guarantee and protect workers’ rights.”

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CTUF – IER : Bexit & Employment Rights

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UN Rights Expert: “Fundamental Right To Strike Must Be Preserved”

GENEVA (9th March 2017) – Further to the Human Rights Council side event on freedoms of association and of peaceful assembly in the workplace which took place on Monday 6th March, and on the occasion of a key meeting of the International Labour Organization (ILO), the UN Special Rapporteur on the rights to freedom of peaceful assembly and of association, Maina Kiai, is recalling that the right to strike is a fundamental one enshrined in international human rights and labour law, and that its protection is necessary in ensuring just, stable and democratic societies:

“As the 329th session of the Governing Body of the ILO starts today, I wish to reiterate the utmost importance of the right to strike in democratic societies.

As stated in my 2016 thematic report to the General Assembly (A/71/385), the right to strike has been established in international law for decades, in global and regional instruments, such as in the ILO Convention No. 87 (articles 3, 8 and 10), the International Covenant on Economic, Social and Cultural Rights (article 8), the International Covenant on Civil and Political Rights (article 22), the European Convention on Human Rights (article 11), and the American Convention on Human Rights (article 16). The right is also enshrined in the constitutions of at least 90 countries. The right to strike has in effect become customary international law.

The right to strike is also an intrinsic corollary of the fundamental right of freedom of association. It is crucial for millions of women and men around the world to assert collectively their rights in the workplace, including the right to just and favourable conditions of work, and to work in dignity and without fear of intimidation and persecution. Moreover, protest action in relation to government social and economic policy, and against negative corporate practices, forms part of the basic civil liberties whose respect is essential for the meaningful exercise of trade union rights. This right enables them to engage with companies and governments on a more equal footing, and Member States have a positive obligation to protect this right, and a negative obligation not to interfere with its exercise.

Moreover, protecting the right to strike is not simply about States fulfilling their legal obligations. It is also about them creating democratic and equitable societies that are sustainable in the long run. The concentration of power in one sector – whether in the hands of government or business – inevitably leads to the erosion of democracy, and an increase in inequalities and marginalization with all their attendant consequences. The right to strike is a check on this concentration of power.

I deplore the various attempts made to erode the right to strike at national and multilateral levels. In this regard, I welcome the positive role played by the ILO’s Government Group in upholding workers’ right to strike by recognizing that ‘without protecting a right to strike, freedom of association, in particular the right to organize activities for the purpose of promoting and protecting workers’ interests, cannot be fully realized.’

I urge all stakeholders to ensure that the right to strike be fully preserved and respected across the globe and in all arenas”, the expert concluded.

ENDS

Mr. Maina Kiai, Special Rapporteur on freedom of peaceful assembly and of association, took up his functions as the first Special Rapporteur on the rights to freedom of peaceful assembly and of association in May 2011. He is appointed in his personal capacity as an independent expert by the UN Human Rights Council.

The Special Rapporteurs and Independent Experts are part of what is known as the Special Procedures of the Human Rights Council. Special Procedures, the largest body of independent experts in the UN Human Rights system, is the general name of the Council’s independent fact-finding and monitoring mechanisms that address either specific country situations or thematic issues in all parts of the world. Special Procedures’ experts work on a voluntary basis; they are not UN staff and do not receive a salary for their work. They are independent from any government or organization and serve in their individual capacity.

Click on graphic for further information.

 

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Merseyrail Legal Challenge Fails

RMT on Merseyrail legal challenge

9th March 2017

General Secretary Mick Cash said:

“This is an important victory for the union. However, it is frankly ludicrous that Merseyrail have been wasting important time and money on bogus legal challenges this week when they should have been sat round the table with the union negotiating a safe and sustainable settlement to this dispute which gives the travelling public the guarantee of a guard on their trains.

The strike action goes ahead”/

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Bangladeshi Garment Workers Released

Valter Sanches, General Secretary of IndustriALL the global trade union for manufacturing and energy workers has announced that 35 Bangladeshi unionists and garment workers arrested in December last year have all been released. This follows an international campaign led by IndustriALL Global Union and UNI Global Union against the Bangladesh government’s crackdown on the labour movement.

A tripartite agreement was reached on 23rd February between IndustriALL Bangladesh Council (IBC), the Ministry of Labour and the Bangladesh Garment Manufacturers and Exporters Association, providing the release of the arrested trade unionists and garment workers. According to the agreement cases against them will be disposed of.

This follows an incredible show of global solidarity, and is an important victory for garment workers in Bangladesh, sending a strong message to the country’s industry to enter into a constructive dialogue with the trade unions.

IndustriALL says they were also successful in putting pressure on brands in the context of the Global Framework Agreements with them.

The issue that sparked the crackdown on unions at the end of last year still remains. We will continue to support the fight for higher wages and will closely monitor the situation until all charges are dropped.

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Tory Anti-Union Laws Come Into Force

As the new anti-union legislation pushed through by the Conservative Party will the UKs biggest union Unite said it would continue to support working people seeking justice.

Speaking the Trade Union Act comes into law Len McCluskey announced regional dispute teams to ensure that not one member will be denied the justice or support they need, as the regressive new rules impose higher thresholds for industrial action ballots and attack trade unions’ ability to campaign.

This follows the union’s rule change to ensure that it can take action to defend members even if forced outside the law by this Act, in addition to the establishment of a £35 million strike fund to support members through disputes.

The Act, which seeks to tie unions up in red tape and administration costs, as well as erecting barriers to the fundamental right to strike – has been derided as ‘not fit for purpose’ by the government’s own regulator and denounced as ‘needlessly ideological’ by former business secretary, Vince Cable.

Commenting Unite general secretary Len McCluskey said: “This is a dark day for basic rights in this country. Once again, Conservative laws are a gift to the bad bosses as they make it harder for working people to get a fair hearing. They have priced working people out of the tribunal process and now they want to intimidate their unions into inaction.
 
“Well, that is not going to happen at Unite. There is no way that this union will allow a Conservative or any other government to further stack the dice against working people.
 
“Unite has already organised itself to be able to see off these attacks and to ensure that our members will be defended to the hilt when they need to be.  Our rules have been changed to ensure that we can defend members even when the law has been twisted to prevent this, and our £35 million strike fund ensures that no Unite member will ever be starved back to work. Added to this our regional dispute teams will provide the rapid and expert support workers need when faced with trouble in the workplace.
 
“The Conservative party is fundamentally wrong in how it treats union members.  There are six million of us, all with families and friends, so our reach is far further.  We are not the `enemy within’. We are the people who care for our sick, our children and our communities, who keep our shops shelves stacked, keep our country defended and the lights on.
 
“The anti-worker legislation being brought in today is a disgraceful way to treat decent people.  Today, sadly, this county, thanks to the Tories, takes a massive step backwards into becoming a more unequal nation.”

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Unite Demands Government Ends Umbrella Companies

Unite Acting General Secretary Demands End To Umbrella Companies Rip Off

Unite, now the UKs biggest union for construction workers, has called for ‘umbrella companies’ to be outlawed after a BBC report exposed how construction workers are falling victim to wage theft.

The union made its demand after BBC Look North on February 24 carried an expose on how workers operating via umbrella companies in construction and other sectors are having huge deductions taken from their pay.

Umbrella company workers have to pay employers’ and employees’ national insurance contributions as well as income tax, a tax rate of 45.8 pence in the pound on eligible earnings.

Workers often have their holiday pay rolled into the rate, meaning they are unpaid when taking leave. If they pay into an auto-enrolment pension they have to pay both employee and employer contributions. Umbrella company workers have to pay a fee of around ÂŁ20 a week to be paid in this manner.

The huge growth in umbrella companies operating in construction began in April 2014. This was a result of government legislation which attempted to outlaw employment agencies from bogusly self-employing construction workers.

Overnight the industry moved to the umbrella company model in order to avoid paying employer’s NI contributions.

Unite have recently established a bogus self-employment unit to step up their support of members who are being denied basic employment rights. The unit is also targeting umbrella companies.

Acting general secretary, Gail Cartmail, said: “Umbrella companies are highly immoral and rip off workers. The government need to end the misery of umbrella company workers by outlawing this practice and all forms of bogus self-employment.”
 
“Unite has already succeeded in outlawing umbrella companies for example on Hinkley Point. The Scottish and Welsh governments and several local authorities have introduced measures outlawing umbrella companies on public sector contracts. If the government fails to act we will step up pressure on all public and private sector organisations to ban these sinister organisations.”
 
“The message is loud and clear Unite are coming for rogue employers who increasingly rely on false self-employment. We will leave no stone unturned in exposing the blatant unfairness of umbrella companies, ending exploitation and getting justice for our members.”
 
The government has previously estimated that 430,000 workers are paid via umbrella companies. Unite believes that this figure is an underestimate as unscrupulous employers in sectors such as logistics, supply teaching and pharmaceuticals are increasingly using this form of employment.

 

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Trump To Visit Boeing S.C. Plant After Anti Union Vote

Following on from the good news of the withdrawal of his nomination for US Labor Secretary by Andrew Pudzer, US unions suffered a setback when workers at Boeing’s South Carolina plants voted against recognition of the International Association of Machinists and Aerospace Workers union following massive pressure and a fierce anti union campaign by the company and local politicians. 74% of 2800 workers voted against the union. South Carolina is one of the least unionised states in the USA.

US President Donald Trump is expected to appear at the plant today celebrate the rollout of the first 787-10 jet liner, the largest version of the Boeing Dreamliner.

The vote came two years after the Machinists union had called off a vote at the South Carolina facilities following widespread misinformation and ‘unrelenting pressure from local politicians’.

The Machinists union were confident that this time workers would vote for a union citing management’s unfair approach to evaluating staff, pay raises and promotions.

Workers complained that instructions on performing their jobs changed from month to month. Production and maintenance workers in South Carolina, make $23 per hour on average, compared to about $31 per hour for comparable workers in Washington State.

Boeing’s efforts to defeat the union organising campaign proved too strong. The company using well tested anti union messages implied to workers that a union would drive a wedge between them and management and they also used the machinists’ union’s opposition to its 2009 decision to open a second Dreamliner assembly line in South Carolina.

The union back then had argued that opening the plant would undermine the protected right to strike of tens of thousands of Boeing workers in Washington State, and the machinists filed a charge against the company with the National Labor Relations Board.

Opponents of unionisation also ran a series of adverts opposing the union, including one depicting the machinists union as a casino boss who wanted workers to gamble away their future.

Critics of the union say they rushed the campaign to unionise the S.C. sites before Trump could appoint two new members to the N.L.R.B., which would give Republicans a majority on the board.

Mike Evans, the lead organizer for the machinists’ union, said the union had moved to hold the vote ‘because it believed it had finally built sufficient support among workers’.

The N.L.R.B.’s make-up will be a factor in future organizing campaigns as a Republican board could undo rules enacted in 2015 to expedite the union election process, a move widely viewed as helping organizers.

 

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Anti Union Pudzer Withdraws From Nomination For USLabour Secretary

By Tony Burke : Chair, Campaign For Trade Union Freedom

Many trade unionists in the USA have a ‘spring in their step’ today (Wednesday 16th February) after learning that Donald Trump’s nominee for US Labour Secretary Andrew Pudzer withdrew his nomination when he recognised the uphill climb he was facing on Capitol Hill.

Pudzer the CEO of fast food chain giant CKE Restaurants, (owners of Carl’s Jr and Hardee’s outlets) was due to appear before the Senate health, education, labour and pensions committee Thursday

Pudzer’s nomination was facing opposition from unions, progressive groups, democrats and even some republicans.

The US Department of Labor website states that its mission is to “foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights.”

Puzder’s pedigree showed that he was likely to fall foul of the statement – as he has done the exact opposite of what the mission statement requires.

He has fought against workers’ rights; argued against increases in minimum wages; argued for replacing workers with robots and “and showed disdain for his own employees –   the very people who helped make him a multi millionaire” according to Sarah Baker who led the vetting team in the White House during Obama’s presidency.

It transpires that Puzder employed an ‘undocumented immigrant’ and never paid taxes – and he would have been responsible for wage and working hours standards, benefits and providing protection for workers.

Adverts for his Carl’s Jr. and Hardee’s outlets have been described as ‘pornographic’ and ‘sexist’ – depicting scantily clad women in bikini’s eating burgers. Pudzer naturally disagreed calling the adverts ‘American’.

In 1990, Puzder’s ex-wife went on the Oprah TV show (in diguise) and alledged that Pudzer abused her – a claim she has since withdrawn.

Richard Tumka the President of the US union umbrella organization the AFL-CIO says “the power of collective action” brought Pudzer down.

Unions and progressive groups have organized demonstrations against Pudzer since his nomination was announced, with a remarkable degree of success.

The Service Employees International Union (SEIU), staged protests around the country, the largest outside of CKE’s St. Louis headquarters.

Mindful of the blue collar support for Trump among their own members unions made Puzder the focus of a campaign to portray Trump as a tool for corporate interests who favours low wages and exploitation.

Thomas Perez, the former US secretary of labour who is in the running to lead the Democratic National Committee, called Pudzer a “frequent flyer defendant – someone for whom we had a steady diet of wage and hour cases”.

“When you call your workers the ‘the worst of the worst,’ (as Pudzer has done) that’s no way to earn or command respect,” Perez said.

This decision was good news but as a US friend and a senior union official told me: “Who knows who Trump will bring forward next? The CEO of Burger King?”

Read more by clicking here: The New Yorker

 

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