Business and the labour dimension of human rights due diligence

Due diligence is a management tool that allows enterprises to uphold their responsibility to respect human rights as outlined in the UN Guiding Principles on Business and human rights, the ILO MNE Declaration and the OECD MNE Guidelines. Due diligence consists of a process that allows companies to identify, prevent and mitigate their actual and potential adverse impacts on human rights and account for how they address such impacts. Labour rights are human rights and thus a critical component of any due diligence process. However, proper due diligence on respecting labour rights begins with a good understanding of what is expected of companies.

In line with the Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework, the Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration) states that: “Enterprises, including multinational enterprises, should carry out due diligence to identify, prevent, mitigate and account for how they address their actual and potential adverse impacts that relate to internationally recognized human rights, understood, at a minimum, as those expressed in the International Bill of Human Rights and the principles concerning fundamental rights set out in the ILO Declaration on Fundamental Principles and Rights at Work” (paragraph 10 d).

The ILO Declaration on the Fundamental Principles and Rights at Work is an expression of commitment by governments, employers' and workers' organizations to uphold basic human values - values that are vital to our social and economic lives. It affirms the obligations and commitments that are inherent in membership of the ILO, namely: freedom of association and the effective recognition of the right to collective bargaining; the elimination of all forms of forced or compulsory labour; the effective abolition of child labour; the elimination of discrimination in respect of employment and occupation; and a safe and healthy working environment.

The MNE Declaration provides further orientations to enterprises on how to gauge human rights risks in their own operations and as a result of their business relationships: “(…) enterprises – including multinational enterprises – should identify and assess any actual or potential adverse human rights impacts with which they may be involved either through their own activities or as a result of their business relationships. This process should involve meaningful consultation with potentially affected groups and other relevant stakeholders including workers’ organizations, as appropriate to the size of the enterprise and the nature and context of the operation. For the purpose of achieving the aim of the MNE Declaration, this process should take account of the central role of freedom of association and collective bargaining as well as industrial relations and social dialogue as an ongoing process” (paragraph 10 e).