Labour standards in the World Trade Organization are binding rules, which form a part of the jurisprudence and principles applied within the rule making institutions of the World Trade Organization (WTO). Labour standards play an implicit, but not an overt role within the WTO, however it forms a prominent issue facing the WTO today, and has generated a wealth of academic debate.
The debate about the extent to which the WTO should recognise labour standards is typically based on the principles found in Conventions of the International Labour Organization (ILO), as well as mainstream human rights treaties, most prominently, the International Bill of Human Rights.Includes the Universal Declaration of Human Rights (UDHR), the International Covenant on Economic, Social and Cultural Rights (ICESCR) and the International Covenant on Civil and Political Rights (ICCPR) and its two protocols.
WTO overview
The WTO is an international institution that deals with the rules of trade between countries with the view of inter alia "raising standards of living, [and] ensuring full employment…".World Trade Organization, 'Preamble', Agreement Establishing the World Trade Organization, par. 1 http://www.wto.org/english/docs_e/legal_e/04-wto.pdf This is achieved through a series of trade liberalising agreements based on consensus from the WTO's 164 members who form the General Council. The General Council, sitting as the Dispute Settlement Body (DSB) has the jurisdictional power to solve disputes brought before it, and is able to approve trade restrictive measures to enforce compliance with agreements. The WTO's dispute settlement process is compulsory and the DSB's recommendations and rulings immediately become binding international law.Jackson, J 2005, 'The Role of International Law in Trade', Georgetown Journal of International Law, Vol. 36; Iss. 3; pp 663, 5
History of the WTO The WTO has its origins in the 1944 Bretton Woods Conference which was convened by the Allied nations towards the end of World War II with the aim of establishing an international economic order. Although the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (now known as the World Bank) were created, the International Trade Organisation (ITO), the forerunner of the WTO, was only a proposition at this point. It was not until 1947 that negotiations were concluded and the ITO came into being. In the Havana Charter, the text of the ITO, Article 7 pertained specifically to fair labour standards, requiring that members of the organisation must, amongst other things, "take fully into account the rights of workers under inter-governmental declarations, conventions and agreements" and recognise "that all countries have a common interest in the achievement and maintenance of fair labour standards related to productivity, and thus in the improvement of wages and working conditions as productivity may permit".Final Act of the United Nations Conference on Trade and Employment: Havana Charter for an International Trade Organisation Havana Charter accessed 4/3/2007 In the interim period before the ratification of the charter, states decided to follow an interim agreement, known as the General Agreement on Tariffs and Trade (GATT), which was to be later incorporated into the ITO's legal framework. This temporary arrangement did not include any references to labour rights. The requisite number of states failed to ratify the ITO and so it failed and GATT became the basis for the current world trade system.Wilkinson, R 1999, 'Labour and trade related regulation: beyond the trade-labour standards debate?', British Journal of Politics and International Relations, vol.1, no.2, pp 165-191
The WTO was established 1 January 1995 as a result of the Uruguay Round of negotiations (1986–1994). It was formed from the GATT, which became one of the core agreements annexed to the Marrakesh Agreement, the document establishing the WTO. None of the other WTO agreements concluded at the end of the Uruguay Round include labour rights obligations. The effects of GATT are still felt and some commentators have described the WTO as the one major international governance organisation that does not examine the impact of its policies upon the ability of member states to advance human rights.Aaronson, S & Zimmerman, J Nov 2006, 'Fair trade? How Oxfam presented a systematic approach to Poverty, Development, Human Rights & Trade' Human Rights Quarterly, vol.28, no. 4.
Problems with the current approach The WTO currently does not have jurisdiction over labour standards and the only place in which they are mentioned in the entire set of WTO Agreements is in GATT Article XX e) "relating to the products of prison labour". Since the formation of the WTO in 1995 there have been increasing calls for action on the labour standards issue,Steve Hughes and Rorden Wilkinson (2000), "Labor standards and global governance: examining the dimensions of institutional engagement", Global Governance, 6: 2, pp. 259-277 and requests for a "human face on the world economy". The United Nations is among those bodies which have criticised the current system, and have called for a shift to a human rights oriented approach to trade, with steps to be taken "to ensure that human rights principles and obligations are fully integrated in future negotiations in the World Trade Organization",United Nations Sub-Commission on the Promotion and Protection of Human Rights, The Realization of Economic, Social and Cultural Rights: Globalization and its impact on the full enjoyment of human rights, par.63 http://www.unhchr.ch/huridocda/huridoca.nsf/(Symbol)/E.CN.4.Sub.2.2000.13.En?Opendocument as the "primacy of human rights law over all other regimes of international law is a basic and fundamental principle that should not be departed from". It is clear that states have both a legal and a moral obligation to uphold human rights standards, inclusive of their activities in the economic sphere. The United Nations (UN) Charter states that in "the event of a conflict between the obligations of the Members of the United Nations under the present Charter and their obligations under any other international agreement, their obligations under the present Charter shall prevail".'Charter of the United Nations', Chapter XVI, Article 103 of Charter. The UN Charter explicitly advocates the upholding of human rights and fundamental freedoms.'Charter of the United Nations', preamble, art. 62(2). This means that respect for human rights, and within this, labour standards, effectively trumps any conflicting WTO Agreements. However, not all WTO members are members of the UN (e.g. Taiwan), which raises issues.
Core labour standards
Identified by the International Labour Organization (ILO) in the 'Declaration of the Fundamental Principles and Rights at Work',International Labour Organization 2006, 'Core Labour Standards Handbook', Manilla core labour standards are "widely recognised to be of particular importance".Organisation for Economic Cooperation and Development 1996 'Trade, Employment and Labour Standards: A Study of Core Workers' Rights and International Trade' They are universally applicable, regardless of whether the relevant conventions have been ratified, the level of development of a country or cultural values. These standards are composed of qualitative, not quantitative standards and don't establish a particular level of working conditions, wages or health and safety standards. They are not intended to undermine the comparative advantage that developing countries may hold. Core labour standards are important human rights and are recognised in widely ratified human rights instruments including the Convention on the Rights of the Child (CROC), the most widely ratified human rights treaty with 193 parties, and the ICCPR with 160 parties.Office of the United Nations High Commissioner for Human Rights, Ratification and Reservations: Convention on the Rights of the Child, Office of the United Nations High Commissioner for Human Rights, Ratification and Reservations: International Covenant on Civil and Political Rights, The core labour standards are:
freedom of association:ICCPR Art.22, ILO Convention 87 workers are able to join trade unions that are independent of government and employer influence the right to collective bargaining:ICCPR Art.22, ILO Convention 98 workers may negotiate with employers collectively, as opposed to individually the prohibition of all forms of forced labour:ICCPR Art. 8, ILO Conventions 29 and 105 includes security from prison labour and slavery, and prevents workers from being forced to work under duressGreenfield, G 2001 'Core Labor Standards in the WTO: Reducing labor to a global commodity', Working USA, vol.5, Iss. 1; pp 9 elimination of the worst forms of child labour:CROC Art. 32 ILO Convention 138 implementing a minimum working age and certain working condition requirements for children non-discrimination in employment : equal pay for equal work.
Most ILO member countries have ratified all of these conventions - 140 ILO member States have ratified all 8 fundamental Conventions.
Barriers to promoting labour standards There are some major roadblocks to the process of recognising core labour standards within the WTO. Firstly, incorporating labour rights into the WTO is not simply a question of law and economics, but also of politics and ethics. Interplay between states and interest groups cloud the already complex issue further. Recognising human rights and specifically core labour standards in the WTO raises a series of thorny political, and in some cases moral, questions. Because each state is acting primarily according to its national interest, even technically viable solutions that could benefit the majority may become politicised. The highly democratic nature of the WTO compounds this problem because consensus needs to be reached before any major decisions are made, meaning each country effectively carries the power of veto, sometimes making it difficult to achieve real progress.
Secondly, this issue occurs at the intersection between trade and human rights which raises a series of unique questions. Although the trade and human rights regimes developed alongside each other following WWII, in some ways they are very different. This is because human rights law, unlike other types of international law that are more contractual in nature, governs how states treat their own citizens.Human Rights Survey, Economist, 5 December 1998 Since the Treaty of Westphalia in 1648, sovereignty has been a key principle of the international system, with states being free from any higher legal authority with the entitlement to exclusive, unqualified, and supreme rule within a delimited territory.Baylis, J. and Smith, S. 2005, The Globalisation of World Politics: An introduction to international relations, 3rd edition, Oxford University Press The atrocities committed by the Nazi regime in WWII however resulted in the establishment of a human rights regime where states have a responsibility to protect the rights of their citizens, and may be subject to international condemnation and even intervention if they fail to do so. Human rights law results in an unprecedented number of controls on domestic behaviour, "challenging the traditional legal concept of state sovereignty".Howse, R & Mutua, M 2000 Protecting Human Rights in a Global Economy: Challenges for the World Trade Organization,