Labour clauses in public contracts.Integrating the social dimension into procurement policies and practices. Report 97 III (1B)

The Labour Clauses (Public Contrasts) Convention, 1949 (No. 94), and Recommendation (No. 84) have been largely misunderstood, almost from the moment of their adoption at the start of the second-half of the twentieth century - the era of the ILO' s Declaration of Philadelphia, post-Second World War reconstruction, and the birth of the United Nations and international financial institutions. The objectives of the instruments are two fold. First, to remove labour costs being used as an element of competition among bidders for public contracts, by requiring that all bidders respect as minimum certain locally established standards. Second, to ensure that public contracts do not exert a downward pressure on wages and working conditions, by placing a standard clause in the public contract to the effect that workers employed to execute the contract shall receive wages and shall enjoy working conditions that are not less favourable than those established for the same work in the area where the work is being done by collective agreement, arbitration award or national laws and regulations.