Conference on The Future of Work, Employment and Social Protection
Annecy, January 18-19, 2001
Mr. Laurijssen, Eddy
Deputy General Secretary
ICFTU
Boulevard du Roi Albert II, 5 Bte. 1
B-1210 BRUSSELS
Belgium
Consumers and producers - their role in the promotion of fair labour standards
Introduction
Ladies and Gentlemen:
When I was asked to speak about whether the producer is sacrificed to the consumer, my immediate response was to say
that this is not a logical distinction to make. In reality there are no consumers without producers, and vice versa. To
separate work and consumption is to separate one's head from one's shoulders - because workers' wages pay for their
consumption, which gives jobs to those who produce what they consume, and so more wages, higher consumption. Better
wages will lead to higher consumption and, consequently, increased need for production.
This virtuous circle is a very old one. But globalisation does give a whole new dimension to it. For French people, of
course, especially those who lived through President Mitterrand's programme of economic expansion in 1981 just after the
Socialists were elected, that must evoke some very bitter memories. They remember how France's efforts to boost growth
and employment led rapidly to a huge and unsustainable increase in its import bill, because the Government had not
recognised the extent to which France could not expand its own economy without also bringing in goods from overseas as
well. That led in turn inexorably towards economic problems, followed by an abrupt reversal of policy a few months later.
More recently, though, at different times in the last ten years, globalisation has had more positive effects. When one
region of the world economy has been in recession, the continuing consumption by other regions has kept global
production growing. In the early 1990s, when the US and the EU were both in recession, it was consumption in the newly
industrialising countries of Latin America and Asia that kept the world economy afloat. After the Asian financial crisis in
1997, it was consumption in the US that provided jobs for the rest of the world. And if some of the commentators are right
and the US is about to experience recession, maybe over the next year it will be growth in the EU that takes up the slack.
From a global perspective, this also shows that building the purchasing power of consumers in developing countries can
make a major contribution to world economic growth. And I think you may not be surprised to hear me point out that in
turn, the surest way of generating that purchasing power is by providing decent work for all by raising living standards
which mean, among other things, ensuring that trade unions can undertake effective collective bargaining. On the other
hand, a virtuous circle cannot be achieved when governments gear all their efforts towards export maximisation, which
often involves the repression of wages and workers' rights. That is one of the reasons why such immense global benefits
could be derived from some form of guarantee of basic workers' rights in the international trading system.
What I have described is one of the direct ways in which consumption and production are linked in a globalised economy.
Another way is through the increasingly deliberate choices that consumers can make in a globalised world.
It is said that markets know the price of everything, but the value of nothing. The same cannot be said of the modern
consumer. The great awakening of consumers in the 1960's and 1970's was related largely to product safety and quality, as
much or more than price. Parallel to the growth of the global economy called globalisation in the 1990's, there has been a
new awareness by consumers of what goes into what they are consuming. What goes into products may be dioxin or the
proteins that lead to mad cow disease or it may be child labouror other forms of exploited labour.
The growing awareness by consumers of the effect of their purchases on conditions of workers as well as the dangers of
products and their consequences for the environment does not just exercise itself in the market. Consumers are also
workers and the public. They are helping to restrain the excesses of free market dogma.
The consumer awareness of exploitation is related to the development of production chains. Although multinational
enterprises are playing an ever-growing role in the world economy, that role is not the same as it was 30 years ago. Many
medium, small, micro, and even informal sector enterprises are engaged in the global economy, often through their
relationships with large companies that no longer make products, but simply attach their brands to them and market them.
This process is facilitated by new technologies and by a radical reduction in the cost of transport. Globalisation is a
goldfish bowl for companies and image damage is beginning to enter into cost-benefit analysis. As intangible factors grow
in the value of companies, there are, at least for companies who market their products directly to consumers, some dis-incentives connected to the appearance of anti-social or anti-environmental or anti-human rights behaviour.
So, if one discards the thesis of short term maximisation of profits as a primary objective of companies and their
shareholders, we observe more and more that there exists a common cause, a convergence with the interests of consumers
and those of producers. This evolution has been stimulated and amplified by the phenomenon of globalisation and even
more so by the modern information technology explosion due to which we live today in a very transparent society,
including with regard to commercial and business practices.
Likewise, if rootless capital is to be followed by the emergence of rootless workers tossed about by anonymous market
forces from job to job or rather activity to activity, there will be consequences for employers, workers, and governments. I
am not totally convinced that some of the futurists are right, on this point. Enterprises and governments need to recognise
that it is difficult to combine employee insecurity with real employee loyalty. And, that developing skills and capabilities
outside the company for sub-contracting parts of its operations to outsiders will not strengthen the competencies and basic
value of the enterprise and tend to turn employers into brokers of services or production.
Unfortunately, much of the public debate on these issues is contradictory. Just look, for example, at the area of retirement.
If, in fact, insecure, precarious, and even "flexible" employment becomes the norm, that very well may mean that people
are thrown on the social scrap heap at even younger ages. Already, many workers in their 40's and 50's are having great
difficulty finding jobs and are often explicitly told by potential employers that they are looking for younger workers. At
the same time, many of the advocates of greater "flexibility" are arguing for raising the age of retirement because of
demographic pressure on retirement schemes.
A similar, illogical response, to short-term attachment to employment and the growth of exclusion and inequality is to rely
on funded pensions for retirement provision rather than the social solidarity and universality of pay-as-you-go retirement
systems. Any system of insurance, including social insurance, is about managing risk. Unfortunately, what we are seeing is
a trend towards shifting risk away from enterprises and society as a whole and onto individual workers.
The informalisation of work organisation and in the employment relationship is taking place not only on the bottom of the
social scale with the growth of informal and unprotected work, especially in developing countries. It is taking place in
developed countries as well and even among highly skilled workers. The variety of forms of work organisation boggles
the mind.
Recently, I learned of an Australian domestic airline that has virtually no employees. The people who fly the planes and
work on the ground are shareholders, having purchased a share for 20 Australian dollars. They are not paid any salary, but
receive dividends. Social security is their own problem. And if they are no longer needed or wanted the share is simply
repurchased by the company. This is the ultimate flexibility, completely disposable workers.
So, what are the approaches and principles that can respond to this plethora of related changes in the global economy, in
shifting responsibilities, in work organisation and social protection, even if some of the details may escape us?
The distinction between the nature of laws that protect workers and laws that protect property remains valid, in some cases
even more compelling. Labour law recognises that the parties in the employment relationship have unequal power. It seeks
to compensate for that gap. Some new forms of work organisation escape those protections because of confusing or non-existent employment relationships or are deliberately designed to leave workers unprotected. Legislation and enforcement
has to be constantly examined, changed, and adapted so that the rights and protections of workers remain in spite of such
changes. This is an international as well as national task.
If laws and practices provide real protection for the rights of workers, there will be opportunities for workers to improve
their lives and live in dignity. They may, however, need to be creative and, yes, flexible, including in the structures and
functions of their trade unions. It may be that in some cases very old forms of organisation based on a common craft or
trade or occupation will be the best way for workers to join together rather than based on a common employer.
Social protection in the context of atypical work requires more not less solidarity. And the global economy and
demographic pressures mean more, not less international solidarity. It is not possible to address these problems without
addressing equality issues, not only between groups of workers, but between the rich and poor inside and among countries.
Globalisation has been accompanied by a selective growth of extreme poverty as well as an even more spectacular
concentration of wealth.
Finally, effectively addressing all of these problems requires modern, efficient, and effective mechanisms. Principal
among them is social dialogue and tripartism. This should not mean some sort of vague and unaccountable consultation
with "civil society," but the active involvement of real actors.
I have spoken of getting and keeping the government provided framework right and comprehensive. That is vital and
indispensable. However, even under the best of circumstances, the flexibility and creativity of the most enlightened
regulator will not match the possibilities to regulate the work place found in social dialogue and collective bargaining.
Freedom of association and strong and comprehensive systems of collective bargaining are not just positive for the rights
and protections of workers and for economic and social progress, but are vital roots of democracy itself.
The global economy requires global social dialogue. Fortunately, that is beginning to emerge, in spite of the lack of any
inter-government framework or mandate. A few months ago, a global collective bargaining agreement was signed
between a group of ship-owners and the International Transport Workers Federation. Several framework agreements have
been signed between major multinational enterprises and international trade union bodies of their sector. And, there is
more global social dialogue, including through the UN Global Compact, than we have witnessed in the past.
I leave you with the challenge for the ILO itself as well as for the social partners. How can social dialogue rooted in
respect for freedom of association and collective bargaining be expanded in ILO member countries? And, how can it be
used to grapple with the problems identified at this conference? But, also, how can the ILO become more relevant to
building global social dialogue? This is a central ingredient in building decent work in the global economy and in building
a future we can all welcome.
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