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Sources of International Labor Law

The International Labor Organization (ILO), a specialized agency of the United Nations, is the main worldwide vehicle for developing and promoting labor standards. It has promulgated more than 180 labor rights conventions. At least three reasons-both moral and practical-led to the creation of the ILO in 1919. Concern existed about the poor conditions of people at work, but the founders of the labor organization also worried that unless those conditions were improved, social unrest would be likely to follow. At the same time, the impact on trade of unfair labor practices was a matter of deep preoccupation.3 Concern that lower wages and labor standards in one country will adversely affect workers in another-known as "social dumping"-remains today.4

Based on consensus about basic workers' rights, the ILO has identified eight core conventions: Freedom of Association and Protection of the Right to Organize, 1948 (Convention No. 87); Right to Organize and Collective Bargaining Convention, 1949 (Convention No. 98); Forced Labor, 1930 (Convention No. 29); Abolition of Forced Labor Convention, 1957 (Convention No. 105); Discrimination (Employment and Occupation), 1958 (Convention No. 111); Equal Remuneration, 1951 (Convention No. 100); Minimum Age, 1973 (Convention No. 138); and Worst Forms of Child Labor, 1999 (Convention No. 182).

Although not all countries have ratified these conventions, in 1998 the ILO established the Declaration of Fundamental Principles and Rights at Work, which focuses on the rights enshrined in the core conventions. It holds, "All Members, even if they have not ratified the Conventions in question, have an obligation arising from the very fact of membership in the Organization, to respect, to promote and to realize, in good faith and in accordance with the Constitution, the principles concerning the fundamental rights which are the subject of those Conventions, namely: (a) freedom of association and the effective recognition of the right to collective bargaining; (b) the elimination of all forms of forced or compulsory labor; (c) the effective abolition of child labor; and (d) the elimination of discrimination in respect of employment and occupation."5

Other sources of international labor-related law include the International Covenant on Civil and Political Rights (ICCPR), which states: "Everyone shall have the right to freedom of association with others, including the right to form and join trade unions for the protection of his interests."6 All three NAFTA countries are parties to the ICCPR. Canada and Mexico are also parties to the International Covenant on Economic, Social and Cultural Rights (ICESCR), encompassing the right to the enjoyment of just and favorable conditions of work, the right to form and join trade unions, and the right to strike.7 The American Convention on Human Rights, ratified by Canada and Mexico, also enshrines the right to free association.8 In addition, Mexico and Canada have ratified the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW), which prohibits employment-related discrimination.9 The United States has signed but not ratified the ICESCR, American Convention, and CEDAW, binding it to do nothing in contravention of their terms.

Links between Labor Rights and Trade

The NAALC was not the first attempt to address labor rights in the context of trade. As long ago as 1919, for example, the covenant establishing the League of Nations enjoined that body's member states to ensure "fair and humane conditions of labor" both domestically and "in all countries to which their commercial and industrial relations extend."10 In such general terms, the ill-fated League's member states undertook to engage their trading partners in efforts to secure labor rights.

After the demise of the League of Nations, the issue of labor rights and trade was taken up again as countries negotiated a charter for what was to be the International Trade Organization (ITO). Article 7 of the charter read, "The Members recognize that measures relating to employment must take fully into account the rights of workers under inter-governmental declarations, conventions and agreements. They recognize that all countries have a common interest in the achievement and maintenance of fair labor standards related to productivity, and thus in the improvement of wages and working conditions as productivity may permit."11 The organization never got off the ground, but the idea enshrined in Article 7 lived on in the General Agreement on Tariffs and Trade (GATT), established in 1947 to develop and enforce international trade rules. The parties to the GATT were required to observe the labor rights principles enunciated in the charter of the failed ITO. Nonetheless, neither the ITO nor the GATT established a mechanism to enforce labor standards.

Toward Enforceable Labor Rights Protections

No compulsory enforcement mechanism exists to ensure that countries respect the labor standards included in ILO conventions. The World Trade Organization (WTO), successor to the GATT since 1995, did not establish any direct linkages between trade and labor rights. In December 1996, for example, at ministerial discussions in Singapore, the WTO rejected any direct involvement in labor rights issues, and reiterated that the ILO was the appropriate venue for dealing with labor rights.12 More recently, however, the Seattle ministerial meeting of the WTO in 1999 saw strong public discord about the role of labor rights in trade agreements.

Other international trade organizations, and several international commodity agreements, also address labor standards.13 The Organization for Economic Cooperation and Development (OECD) has a mechanism for receiving complaints of labor rights violations committed by multinational corporations, but lacks sanctions capabilities.14

The United States-Jordan Free Trade Agreement
On October 24, 2000, the United States and Jordan signed an agreement to establish a free trade area that contains labor rights provisions as a core part of the accord. In several key ways, the agreement breaks new ground in linking labor rights and trade, although application of its labor provisions will still depend on the political will of officials from the signatory governments. At this writing, the U.S. Congress had yet to vote on the agreement.

In comparing the potential for effectiveness between the NAALC and the U.S.-Jordan agreement, it is important to consider their differences with respect to the type of remedies they establish and when those remedies become available. The NAALC establishes a low threshold for governments to engage in non-binding remedial work on its full range of labor principles, but creates a high threshold for sanctions-producing work on a more limited range of labor law issues. In contrast, the U.S.-Jordan agreement establishes a high threshold for countries to begin to work on cases, but skips the non-binding remedial activities altogether by moving directly to case reviews that could lead to sanctions for non-enforcement of the full range of labor principles that it covers.

The labor laws subject to the U.S.-Jordan agreement are referenced to core international labor laws, and draw on bilateral U.S. trade law. The agreement notes that each signatory will "strive to ensure" that its domestic labor laws reflect the ILO's Declaration of Fundamental Principles and Rights at Work and will endeavor to improve its domestic standards. However, it does not require the signatories to ensure that they meet these goals.

The effective enforcement of each party's domestic laws will be reviewed to determine compliance with the U.S.-Jordan accord, and sustained or recurring non-enforcement of those laws could lead to sanctions.15 The agreement does not specify the types of actions the parties can take in response to violations of the accord. Rather, it establishes that if a dispute is not settled amicably, "the affected Party shall be entitled to take any appropriate and commensurate measure."16 The pact covers freedom of association and the right to organize, the right to bargain collectively, the prohibition on the use of any form of forced or compulsory labor, a minimum age for the employment of children, and acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health.17 The parties to the NAALC promise to effectively enforce a greater number of labor laws, but it permits sanctions only for a persistent pattern of non-enforcement of laws related to child labor, minimum employment standards, and occupational safety and health.

Structurally, the U.S.-Jordan pact overcame some of the limitations of the NAALC. The signatories integrate its labor stipulations into the body of the accord, providing them with as much force as the pact's provisions on trade and intellectual property rights.18 In addition, the accord does not divide its labor principles into tiers, with certain levels permitting stronger mechanisms to promote resolution of violations than others, as does the NAALC. Finally, where defined, the time periods for action under the dispute settlement mechanisms are shorter than they are for the NAALC, although no time frame is given for the naming of members of a dispute settlement panel under the U.S.-Jordan accord.19

The U.S.-Jordan agreement sets a high standard for a case to be opened for review. It holds that "A Party shall not fail to effectively enforce its labor laws, through a sustained or recurring course of action or inaction," but then limits this provision by noting that a failure to effectively enforce labor law will only be of concern if it takes place "in a manner affecting trade between the Parties."20 Trade between the two countries is minimal, totaling U.S. $300 million in 1999, with only $30 million in imports to the United States from Jordan.21

The NAALC also contains wording linking remedial action to trade, but it does not erect barriers to initial efforts to promote compliance with the accord's obligations. It does, however, limit the formation of an Evaluation Committee of Experts-a step beyond the initial review and activities designed to address violations of the NAALC's obligations-to matters that are "trade-related," a reference to goods or services that are traded between signatories or that compete with goods or services produced in a signatory country.22 Work by the NAOs and between labor ministries designed to address violations of the NAALC's obligations need not be related to trade at all; rather, the issue to be addressed must be related to "any matter within the scope of the [NAALC]."23

Like the NAALC, the U.S.-Jordan accord limits the scope of its labor protections by excluding from concern any "course of action or inaction" leading to a failure to effectively enforce labor laws that results from the exercise of investigation-related, regulatory, or prosecutorial discretion, or "results from a bona fide decision regarding the allocation of resources."24

The U.S.-Jordan agreement holds that the governments will consider public views in the implementation of the accord. The implementing regulations for the U.S.-Jordan agreement could further clarify the role of nongovernmental groups in the presentation of complaints and receipt and processing of information, but they had yet to be released at this writing. However, a memorandum of understanding between the parties further defines the role of nongovernmental groups with respect to transparency in the agreement's dispute settlement procedures. It states, for example, that Jordan and the Untied States "shall solicit and consider the views of members of their respective publics in order to draw upon a broad range of perspectives," and that the parties "shall accept and consider amicus curiae submissions by individuals, legal persons, and nongovernmental organizations with an interest in the outcome of the dispute."25

Trade and Labor Rights in the Americas
More than two-dozen bilateral or multilateral trade-related agreements exist in the Western Hemisphere. Several have linked trade and labor rights to varying degrees, including the 1991 agreement creating the Common Market of the South (Mercado Común del Sur, Mercosur), the 1997 Canada-Chile Free Trade Agreement (CCFTA), and the 1997 Charter of Civil Society of the Caribbean Community (CARICOM).26

The treaty establishing Mercosur, the southern Latin American customs union comprising Argentina, Brazil, Paraguay, and Uruguay, did not directly address labor rights issues. In 1994, the Mercosur countries rejected the inclusion of a social charter, after failing to come to agreement on its provisions.27 However, under the auspices of the accord, several working groups were established to address labor-related issues, and an Economic and Social Consultative Forum was created in 1994 and became operational in 1996.28 It provided a context for NGOs, business, and labor interests to discuss issues including labor rights, but its recommendations had no binding authority on the Mercosur countries, which did not have official representation in the group.29

In 1998, however, the presidents of the four Mercorsur countries issued the Social-Labor Declaration, which led to the creation of the Social-Labor Commission. The declaration discusses core labor standards and other labor issues, including migrant workers' rights, and obligates the signatories to respect the enunciated labor standards and enforce their own labor laws.30 It contains no enforcement mechanism, however. The commission comprises government, labor, and business representatives, and includes among its faculties the ability to make recommendations and to report on issues related to the fulfillment of the declaration.

Only the NAALC and the Canada-Chile agreement contain express labor rights standards linked to actionable mechanisms. In most respects, the two agreements are the same. The biggest difference between the two agreements rests with the role of sanctions. Permitted in certain circumstances in the NAALC, sanctions are not a part of the CCFTA.31 A further difference relates to the CCFTA's detailed procedure for using the findings of arbitration panels in domestic courts.32 Such provisions are absent from the NAALC. No complaints have been filed under the CCFTA.

The Caribbean Community and Common Market (CARICOM), established in 1973, developed a Charter of Civil Society in 1997. The charter recognizes basic workers' rights and lays out government responsibilities with respect to those rights.33 The charter establishes a mechanism for lodging complaints about violations of its content, but the strongest action that can be taken in response to a complaint amounts to a recommendation. The charter broke new ground, however, in permitting complaints against more than just governments. In addition, "social partners"-defined as "the Government of a State, Associations of Employers, Workers Organisations and such Non-Governmental Organisations as the State may recognize"-can be the subject of complaints. 34 No complaints have been filed under the Charter of Civil Society.

3 See, for example, Eddy Lee, "Globalization and Labour Standards: A Review of Issues," International Labour Review, Vol. 136, No. 2, 1997. Available on the Internet at

4 See, for example, Stephen S. Golub, "Are International Labor Standards Needed to Prevent Social Dumping?" Finance and Development, December 1997, pp. 20-23, and Robert T. Stranks, "The New Jerusalem: Globalization, Trade Liberalization, and Some Implications for Canadian Labour Policy," Department of Foreign Affairs and International Trade, Government of Canada, February 1994.

5 ILO Declaration on Fundamental Principles and Rights at Work, adopted by the International Labour Conference, Geneva, June 18, 1998.

6 International Covenant on Civil and Political Rights, Article 22.

7 International Covenant on Economic, Social and Cultural Rights, Articles 7 and 8.

8 American Convention on Human Rights, Article 16(1).

9 Convention on the Elimination of All Forms of Discrimination against Women, Article 11.

10 Philip Alston, "International Trade as an Instrument of Positive Human Rights Policy," Human Rights Quarterly, Vol. 4, No. 2, Spring 1982, p. 171.

11 Cited in ibid., p. 172.

12 World Trade Organization, "Singapore Ministerial Declaration," December 13, 1996. The declaration holds, "We renew our commitment to the observance of internationally recognized core labour standards. The International Labour Organization (ILO) is the competent body to set and deal with these standards, and we affirm our support for its work in promoting them."

13 International Confederation of Free Trade Unions, "Building Workers' Human Rights into the Global Trading System,"1999, p. 61. These include the International Sugar Agreement, Tin Agreement of 1981, Cocoa Agreement of 1986, and International Rubber Agreement of 1987.

14 Lance Compa, "The First NAFTA Labor Cases: A New International Labor Rights Regime Takes Shape," U.S.-Mexico Labor Law Journal, 1995, p. 160.

15 Agreement between the United States of American and the Hashemite Kingdom of Jordan on the Establishment of a Free Trade Area, October 24, 2000, Articles 4 and 6(4)(a-e). The agreement states, "A Party shall not fail to effectively enforce its labor laws, through a sustained or recurring course of action or inaction, in a manner affecting trade between the Parties."

16 Ibid., Article 17(2)(b).

17 Ibid., Article 6(6).

18 Ibid., Article 6.

19 If the Parties fail to resolve a dispute through bilateral consultations within sixty days, the issue will go to the Joint Committee, a committee comprising Jordan's labor minister and the U.S. trade representative. If they fail to reach a resolution in 90 days, the matter will go to a dispute settlement panel, which will be composed of one representative named by each Party and a chair named by those two representatives. There is no deadline for the naming of the members of dispute settlement panels. The panel's non-binding report will be sent to the Joint Committee, which will endeavor again to resolve the dispute taking into consideration the report's recommendations. If no resolution is reached, the affected party will be able to take an "appropriate and commensurate measure." Ibid., Article 17.

20 Ibid.

21 U.S. Census Bureau, U.S. Trade Balances by Country, available on the Internet at

22 NAALC, Article 49.

23 Ibid., Article 22(1).

24 Agreement between the United States of American and the Hashemite Kingdom of Jordan, Article 6(4)(b).

25 "Memorandum of Understanding on Transparency in Dispute Settlement Under the Agreement between the Untied States and Jordan on the Establishment of a Free Trade Area," October 24, 2000.

26 For a detailed discussion of these systems, see International Labor Rights Fund, "Developing Effective Mechanisms for Implementing Labor Rights in the Global Economy," August 1998, discussion draft, available on the Internet at

27 Lance Compa, "Works in Progress: Constructing the Social Dimension of Trade in the Americas," paper delivered at the U.S.-E.U. Seminar on the Social Dimension of Economic Integration, Washington, DC, October 14-15, 1999, p. 17.

28 Ibid., pp. 19-20.

29 Ibid.

30 Ibid., p. 21.

31 Agreement on Labour Cooperation between the Government of Canada and the Government of the Republic of Chile, Article 35(4)(b).

32 Ibid., Article 37.

33 Charter of Civil Society for the Caribbean Community, Article 19.

34 Ibid., Article 1.

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