FLO Training Manual 2.0. INTRODUCTION INTO THE GENERIC FAIRTRADE STANDARDS FOR HIRED LABOUR (WITHOUT ENVIRONMENTAL PART) - May 2007-

Transcription

1 FLO Training Manual 2.0 INTRODUCTION INTO THE GENERIC FAIRTRADE STANDARDS FOR HIRED LABOUR (WITHOUT ENVIRONMENTAL PART) - May Elaborated by Konrad Matter Introduction into the Generic Fairtrade Standards for Hired Labour 1 of 30

2 The Training Manual Introduction into the Generic Fairtrade Standards for Hired Labour (without the environmental part) is a product of the Fairtrade Labelling Organizations International (FLO), Bonn, Germany. FLO is the worldwide Fairtrade Standards Setting and Certification Organization. Contact information: Fairtrade Labelling Organizations International e.v. Bonner Talweg Bonn Germany Tel.: (+49) Fax: (+49) info@fairtrade.net Coordination: Matthias Kuhlmann Liaison Development Department Producer Business Unit FLO e.v. Special thanks go to the United Nations Online Volunteering Services, namely Mr Graham Bowler, for the support provided Reproduction of text is permitted, provided that the source is cited, FLO e.v. May 2007 Introduction into the Generic Fairtrade Standards for Hired Labour 2 of 30

3 Table of Content A. HISTORICAL AND POLITICAL CONTEXT FLO s way from smallholders to plantations Business and Human Rights: From voluntary codes to binding standards International Labour Law ILO Norms and their relation to Human Rights Fairtrade standards, poverty alleviation and sustainable development B. THE STANDARD SYSTEM Structure of standards Relation of Hired Labour standards to national legislation C. EXPLANATORY COMMENTS ON THE STANDARDS Social Development Economic Development APPENDIX Proposed text elements for master presentation Introduction into the Generic Fairtrade Standards for Hired Labour 3 of 30

4 A. HISTORICAL AND POLITICAL CONTEXT 1. FLO s way from smallholders to plantations When Fair Trade started in the early 1950s, it dealt exclusively with small producers. The first goods traded were mainly handicrafts, produced by groups of artisans. Later, coffee and other food stuff grown by small farmers were gradually introduced. Fair Trade opened the market and paid a fair price for these products, thus increasing the income of the producers. Fair Trade products where mainly sold in shops or market stalls linked to grassroots organisations, churches or aid organisations. The aim was to improve the livelihood of these disadvantaged and hitherto marginalized small producers, fight poverty and foster development. Fair Trade also intended to raise awareness of Northern consumers on development, trade and global justice. Since the creation of the first Fairtrade label in 1988, Fair Trade products have been sold in growing volumes in conventional stores and supermarkets. With the creation of FLO International, the movement harmonized standard-setting and certification. In the beginning, too, Fairtrade Labelling traded only with small producers. The change occurred when FLO, in response to the increasing demand of Fairtrade tea, for the first time decided to work with plantations in the tea sector. Later on the plantation model was extended to bananas and other fresh fruit. Today several Fairtrade-certified products are mainly or exclusively sourced from plantations and/or factories: tea, bananas, fresh fruit and fruit juices, cut flowers and plants, wine grapes and sport balls. These goods have not traditionally been sold on the Fair Trade market or produced in sufficient volume by small-scale producers. Both small producers and workers in developing countries have been disadvantaged or marginalized by the conventional trading system. For both, Fair Trade can be an opportunity to overcome barriers to development. But the problems of the workers differ greatly from those experienced by small producers. For the small farmer, who works his own or rented land and makes a living by selling his produce, the main concern is a fair price. For the worker, what matters are fair wages and decent working conditions. To address these different concerns FLO has developed two sets of producer standards: Generic Standards for Small Farmers Organizations Generic Standards for Hired Labour Situations The first apply to smallholders organized in co-operatives or other organizations with a democratic, participative structure. The second apply to plantations and factories with hired labour, whose workers are organized and can benefit from the additional revenue generated by Fairtrade. Only companies compliant with these standards are Fairtrade certified. The beneficiaries of Fairtrade on plantations and factories are primarily the workers. The benefits they derive from Fairtrade are: (a) the protection of the workers rights and (b) the Fairtrade Premium. These include decent and healthy working conditions, promotion of employment stability, etc. The Standards for Hired Labour safeguard these benefits. Chapter 1 on Social Development safeguards the rights and welfare of the workers at the workplace. Chapter 2 on Economic Development regulates use and administration of the Fairtrade Premium. In most products the company benefits from Fairtrade in the form of a minimum price. The Generic Standards for Hired Labour have gone through several revisions since their first edition. They have been clarified and refined, taking into account the experience gained and Introduction into the Generic Fairtrade Standards for Hired Labour 4 of 30

5 feedback received from stakeholders. The last, quite fundamental review took place in 2005, which resulted in the current version of December Business and Human Rights: From voluntary codes to binding standards The new generic standards refer to the concept of Corporate Social Responsibility. This concept means that business corporations acknowledge that they have social and environmental obligations besides their economic goals. Ethical conduct as a new challenge for companies is nowadays widely debated and its principles are increasingly accepted in the world of business. Corporate Social Responsibility is the recognition that business must find a balance between profitability, sustainable growth and human progress. Companies must not strive for maximum profit at the expense of ethical values. Human rights, social justice and protection of the environment must be part of the strategy of business corporations and guide their conduct. Business interest in corporate ethics was awakened in the 1980s after several scandals, public campaigns and boycotts against companies or whole industries for unethical behaviour. Public scrutiny of business conduct prompted companies and industries to adopt corporate codes of conduct. Although the main motivation behind this was to counter criticism and safeguard reputation, business became aware of its social and environmental responsibility. Voluntary codes of conduct, however, have several weaknesses. Unlike labour law, they do not have legal force and no mandatory minimum standards. They freely pick and choose the issues and often remain very vague. As an example, only few codes include freedom of association among their criteria. The main weakness, however, is the lack of accountability. Implementation of the code depends totally on the company without independent and transparent monitoring. Companies with voluntary codes of conduct are not responsible to anybody for their compliance, neither to the workers nor to consumers or Government. Therefore, in spite of widespread interest, the impact of corporate codes has been limited. To overcome the limitations of voluntary codes, several initiatives proposed more binding and verifiable social and environmental standards combined with monitoring and certification. Some were developed by industry itself, others by trade unions or NGO s. Participation is still voluntary, companies are free to join or not. But if they join, they must commit themselves to compliance and are audited against the standards. The effectiveness and credibility of these programmes depend mainly on three factors: The standards must be high, i.e. the requirements are a real improvement in relation to common practice; their implementation must be practicable and verifiable; and auditing must be independent and professional. The most successful were those initiatives where several stakeholders (NGOs, producers, buyers) cooperated. One of them is Fairtrade Labelling represented by FLO International. It is unique in the sense that it is not only setting and verifying standards, but grants a range of important benefits: Promotion of Market access, the Fairtrade minimum price and the Fairtrade Premium. Other widely known programmes are Rainforest Alliance, SA 8000, ETI and EurepGap. Introduction into the Generic Fairtrade Standards for Hired Labour 5 of 30

6 Rainforest Alliance (formerly Better Banana Project and ECO-OK) serves as the international secretariat of SAN (Sustainable Agriculture Network), a coalition of environmental NGOs in the Americas. It certifies tropical products such as bananas, coffee, cocoa and citrus, but also cut flowers and plants. Its focus is on the environmental impact and on habitat conservation, but has gradually incorporated standards for community relations and labour conditions. SA8000: The Social Accountability Standard SA 8000 has been developed by SAI (Social Accountability International), a US-based multi-stakeholder organization, with the support of an international Advisory Board with experts from trade unions, businesses and NGOs. The standards are based on ILO conventions covering social justice and working conditions. They were originally developed for the manufacturing industry, but since 2000 were also approved for use in agriculture. Ethical Trading Initiative (ETI) is an alliance of companies, NGOs and trade unions based in the UK. Its aim is to promote the implementation of corporate codes of practice in companies along the supply chain. ETI has developed a Base Code based on ILO conventions, similar to the SA8000 standard. Companies can join ETI by committing themselves to implement the Base Code in their supply chains. There is no certification system; companies are held to report annually on their performance. EUREPGAP is a private certification system driven by large supermarket chains in Europe (Euro-Retailer Produce Working Group EUREP). The main focus of the EurepGap norms (Good Agricultural Practices GAP) is on food safety and traceability. The norms also address some environmental practices and some social issues, although these have been criticized for being rather vague. Besides these initiatives driven by stakeholder coalitions, trade unions and NGOs have published their own codes or principles for socially accountable business practices. Two deserve to be mentioned: ICFTU/ITS Basic Code of Labour Practice, and Amnesty International s Human Rights Principles for Companies. They are not used for certification, but meant as a benchmark for voluntary company codes. ICFTU/ITS Basic Code of Labour Practice: The International Confederation of Free Trade Unions (ICFTU) has developed a minimum list of standards that should be included in all codes of conduct covering labour practices. The code follows the ILO conventions. Amnesty International has published the Human Rights Principles for Companies (1998). The document is a checklist for multinational companies. It is based on international human rights standards taken from the Universal Declaration of Human Rights and the ILO conventions and declarations. The relevance of Corporate Social Responsibility is also shown in the growing number of business initiatives. Business leaders around the world gather in forums and networks to place corporate social responsibility in the mainstream of business practice. The most important initiative is Global Compact, launched in 2000 after the UN Secretary General had challenged business leaders to support universal environmental and social principles. Global Impact has had an impressive response. It has now grown to nearly 3000 participants, including over 2500 corporations in 90 countries around the world. Global Compact is a voluntary initiative that invites business companies to support and put into practice, within their sphere of influence, ten principles in the areas of human rights, labour standards, the environment and anti-corruption. It is not a certification system. The 10 principles are: Human Rights Labour Standards Principle 1: Support and respect the protection of internationally proclaimed human rights Principle 2: Make sure that they are not complicit in human rights abuses Principle 3: Uphold freedom of association and effective recognition of the right to collective bargaining Introduction into the Generic Fairtrade Standards for Hired Labour 6 of 30

7 Environment Anti-Corruption Principle 4: Uphold elimination of all forms of forced and compulsory labour Principle 5: Uphold effective abolition of child labour Principle 6: Uphold elimination of discrimination in respect of employment and occupation Principle 7: Support a precautionary approach to environmental challenges Principle 8: Undertake initiatives to promote greater environmental responsibility Principle 9: Encourage the development and diffusion of environmentally friendly technologies Principle 10: Work against all forms of corruption, including extortion and bribery. 3. International Labour Law ILO Norms and their relation to the Universal Declaration of Human Rights The international community has created a body of norms on labour practices and workers rights that transcend national boundaries. Notably, the International Labour Organization (ILO) has developed a system of conventions and declarations on labour rights. All social standards and certification systems described above, including the FLO standards on hired labour, are based on these international norms. The International Labour Organization (ILO) is the UN specialized agency for the promotion of social justice and the protection of labour rights. It was founded in 1919 as a unique tripartite structure with workers and employers participating as equal partners with governments. A cornerstone in ILO s life was the Declaration of Philadelphia (1944). Its principles are: Labour is not a commodity Freedom of expression and association are essential for sustained progress All human beings have the right to pursue their material and spiritual development in conditions of freedom, dignity, economic security and equal opportunity These principles have influenced the evolution of human rights actions globally. Several of the freedoms contained in the Universal Declaration of Human Rights were included at the request of the ILO. The ILO sets international labour standards in the form of Conventions and Recommendations. For its human rights work ILO was awarded the Nobel Peace Prize in The basic source of the contemporary conception of human rights is the UN Universal Declaration of Human Rights. Human rights are international norms that help to protect all people everywhere from severe political, legal, and social abuses. They are universal; that is they are valid independent from geography and culture. As internationally valid norms they cover all countries and all people. The Universal Declaration of Human Rights, proclaimed by the United Nations in 1948 sets out a list of over two dozen human rights. They can be classified into six groups: Security rights that protect against crimes, torture and rape Due process rights protecting against abuses of the legal system such as imprisonment without trial and excessive punishment Liberty rights protecting freedom of expression, of association, etc. Political rights protecting the freedom to participate in political activities such as voting Equality rights guaranteeing equal treatment before the law and non-discrimination Social (or welfare) rights protecting against poverty and wretchedness Introduction into the Generic Fairtrade Standards for Hired Labour 7 of 30

8 All international social standards including those of FLO are rooted in the Universal Declaration of Human Rights. These rights have been further developed by the UN and other international organizations, prominently the ILO. The most relevant document on human rights at the workplace is the International Covenant on Economic, Social and Cultural Rights. The International Covenant on Economic, Social and Cultural Rights was adopted in 1966 by the UN General Assembly and since ratified by 149 states. The Social Covenant's list of rights includes nondiscrimination and equality for women in the economic and social area (articles 2 and 3), freedom to work and opportunities to work (article 6), fair pay and decent conditions of work (article 7), the right to form trade unions and to strike (article 8), social security (article 9), special protections for mothers and children (article 10), the right to adequate food, clothing, and housing (article 11), the right to basic health services (article 12), the right to education (article 13), and the right to participate in cultural life and scientific progress (article 15). The ILO has done a big job to embody the principles of the Covenant in the day to day reality of the world of employment. More than 75 ILO Conventions are relevant to the achievement of the Covenant. The ILO Conventions become law in those countries where they have been ratified, but even in the absence of ratification, they serve as a benchmark for good government and business practice. A decisive step forward in the compulsory character of fundamental labour rights was the adoption, in 1998, of the ILO Declaration on Fundamental Principles and Rights at Work. The Declaration commits all ILO Member States and employers to respect these principles, whether or not they have ratified the relevant Conventions. These principles are: (a) Freedom of association and the effective recognition of the right to collective bargaining (b) Elimination of all forms of forced or compulsory labour (c) Effective abolition of child labour, and (d) Elimination of discrimination in respect of employment and occupation. It has often been argued that the UN Human Rights Declaration is addressed primarily to governments and is not obligating private corporations. However, the Declaration calls on every individual and every organ of society to play its part in the promotion and protection of human rights. Companies, as organs of society, have a responsibility to respect human rights in their operations. This is even more relevant since globalization has expanded the reach of corporate power. This fact has been clearly recognized and found its expression in the UN Human Rights Norms for Business, issued in They are the first authoritative and comprehensive set of global business standards issued by the UN. They mark a clear step forward from voluntary codes of conduct towards a stronger international framework for corporate accountability. Introduction into the Generic Fairtrade Standards for Hired Labour 8 of 30

9 The UN Norms on the Responsibility of Transnational Corporations and Other Business Enterprises with Regard to Human Rights have been approved by the UN Sub-Commission on the Promotion and Protection of Human Rights in They set out a comprehensive list of the human rights obligations of companies. The key provisions with regard to human rights at the workplace are: Non discrimination. Workers rights, including prohibition of forced labour and exploitation of children; as well as mandates for safe and healthy working conditions, remuneration that ensures an adequate standard of living, and freedom of association and collective bargaining. Economic, social and cultural rights: Companies should do what they can within their sphere of activity and influence to uphold the rights to adequate food, drinking water, the highest attainable standard of physical and mental health, housing and education, as well as the right to development. Graph 1 illustrates sources of international labour law, its hierarchical order and its embodiment in international declarations and treaties. Graph 1 Sources of the International Labour Law Universal Declaration of Human Rights (UN 1948) International human rights treaties containing standards on workers rights and welfare, e.g.: International Covenant on Civil and Political Rights (1966) International Covenant on Economic, Social and Cultural Rights (1966) Convention on the Elimination of All Forms of Discrimination against Women (1979) Regional human rights treaties with labour standards, e.g.: American Convention on Human Rights (1969) African Charter on Human and People s Rights (1981) Specific international conventions, principles and codes on labour rights, e.g.:ilo Conventions on labour standards ILO Declaration on Fundamental Principles and Rights at Work The application to business of all the above standards: UN Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (2003) Introduction into the Generic Fairtrade Standards for Hired Labour 9 of 30

10 4. Fairtrade standards, poverty alleviation and sustainable development The uniqueness of Fairtrade compared to other social and environmental standard schemes has already been emphasized. Fairtrade is more than just a standard system; it is a strategy for poverty alleviation and sustainable development. Protecting the workers rights and welfare at the workplace, such as fair and decent employment conditions, freedom from forced and bonded labour or the elimination of child labour, is in itself a means for poverty alleviation, economic development and social progress. The Fairtrade focus on disadvantaged and marginalized producers and workers creates a direct link with the first Millennium Development Goal (MDG) 1. Also all other MDGs are addressed by Fairtrade, as shown in the following table, which relates the MDGs with the hired labour standards: Millennium Development Goal Related to Hired Labour Standards 1: Eradicate extreme poverty and hunger Generally: Focus on disadvantaged and marginalized workers Directly: 1.1 / / / 2 Indirectly: 1.3 2: Achieve universal primary education / : Promote gender equality and empower women 1.2 / / : Reduce child mortality / / : Improve maternal health / / / / : Combat HIV/AIDS, malaria and other diseases : Ensure environmental sustainability 3 8: Develop a global partnership for development The stakeholder approach of Fairtrade In addition to these objectives, which are shared by other advanced social standards, Fairtrade has some very specific instruments for poverty eradiation and sustainable development. One of the core principles of Fairtrade is empowerment. Effective poverty reduction is not possible without empowerment of the poor. Empowerment of the workers is at the heart of freedom of association and collective bargaining, but also of the JB-concept as well as the requirements for workers participation in other areas (health and safety, environmental policy, plan for social improvements). Capacity building, one of the requirements repeatedly found in the Fairtrade standards, is all and above about empowerment. Two additional tools for poverty alleviation and sustainable development, unique of the Fairtrade approach, are the Fairtrade minimum price and the Fairtrade Premium. FT minimum price: World market prices for agricultural products from developing countries are highly volatile and often below the costs of production. A minimum price, set to cover at least the cost of sustainable production, is a pre-condition for paying decent salaries and offering good and healthy working conditions. Therefore most Fair Trade products, with some exceptions such as tea, cane sugar in some countries and cut flowers, have a Fairtrade minimum price. But even for products where there is no minimum price, the contract price should cover the cost of production and ensure price stability. 1 The Millenium Development Goals were declared by the UN General Assembly in 2000 as worldwide development targets to be reached by Introduction into the Generic Fairtrade Standards for Hired Labour 10 of 30

11 The Fairtrade Premium is meant for the benefit of the workers, their families and communities. Through improved living conditions and community projects, the benefits of the Premium spread to a much wider group of people than the direct beneficiaries. It helps thus to fight poverty and promote sustainable development. Beyond the material benefits, the Fairtrade Premium s most important impact is in terms of workers organizations and empowerment. Introduction into the Generic Fairtrade Standards for Hired Labour 11 of 30

12 B. THE STANDARD SYSTEM 1. Structure of standards The Standards for Hired Labour have 3 chapters: Social Development: This chapter is about the social responsibility of the company and its commitment to Fair Trade. It lays down the company s obligations towards the workers: to respect their rights and promote their welfare at the workplace. Economic Development: This chapter deals with the Fairtrade Premium, its purpose, use and administration. It also requires the creation of the Joint Body and lays down the basic rules how the JB should operate. Environmental Development: This chapter is about the environmental responsibility of the company. It establishes rules for the environmental policy and planning, for the use of agrochemicals, for the management of waste and of the natural resources soil and water. The environmental chapter will not be dealt with in this manual. The Standards also distinguish between two sets of requirements: Minimum requirements: Companies must meet all minimum requirements from the moment they join Fairtrade. Their fulfilment is a precondition of Fairtrade certification and they must be complied with at all times. If not, the company risks losing the certificate. Progress requirements: Companies must make efforts for progressive improvement over time. Some progress requirements have a clear timeframe (one or two years), after which full compliance is required. Others are open-ended, i.e. without timeframe. Against these, companies must demonstrate efforts towards long-term improvement. For this purpose, the company must have a plan that shows continuous progress. And the company must report each year to FLO Cert 2 on the progress achieved. How fast progress is expected depends on the level of economic benefits that a company gets from Fairtrade; the more a company sells under Fairtrade and the higher is the minimum price above market price, the more progress it must be able to show. The Standards are currently presented in table format. For each section there is an introductory statement which describes the objective of the section and gives the relevant ILO conventions. Then there are two columns: the left-hand column states the actual wording of the standard the right-hand column explains the objectives of the clauses and provides guidance. 2 FLO Cert GmbH is the branch of FLO International for inspection and certification. Introduction into the Generic Fairtrade Standards for Hired Labour 12 of 30

13 Introductory Statement Section Objective Reference to ILO Convention (if applicable) Minimum requirements This column gives the actual wording of the requirements in the Standard This column says what the requirements are trying to achieve (the objectives) and gives guidance Progress requirements This column gives the actual wording of the requirements in the Standard This column says what the requirements are trying to achieve (the objectives) and gives guidance 2. Relation of Hired Labour standards to national legislation As stated before, the FLO Generic Standards for Hired Labour are based on International Labour Law, which is laid down in international treaties and conventions, particularly those of the International Labour Organization (ILO). FLO also requires that companies always keep to the laws of the country where they operate. For countries that have ratified the ILO conventions, the respective conventions are binding and are normally incorporated into national law. Since the adoption of the ILO Declaration on Fundamental Principles and Rights at Work in 1998, the core conventions on freedom of association, on discrimination, forced labour and child labour have become binding for all member countries of the ILO, even if they are not ratified by the respective country and not incorporated into the law of that country. What is the rule if a country has not ratified a specific convention and the Fairtrade standards are higher than national law? For instance, the law of some countries establishes that maternity leave forfeits annual leave. The FLO standards, in contrast, do not allow forfeiting. In this case, the higher rule of the Fairtrade standards prevails, since the company applying for Fairtade certification committed itself to comply with the Fairtrade standards without exception. Standard compliance is part of the commitment the company took upon itself by signing the operator contract. What happens in a case where the requirements of the national law are higher than the Fairtrade Standards? For instance, if the weekly working hours in a country are below the 48 hours established as maximum in the Fairtrade Standards? In this case, the higher standards set by national legislation supersede FLO standards. The same applies to regional or sectorspecific practices, such as CBA agreements. The general rule is that in any case the higher standard applies. Introduction into the Generic Fairtrade Standards for Hired Labour 13 of 30

14 C. EXPLANATORY COMMENTS TO THE STANDARDS The focus of these comments will be on implications of the standards with regard to roles and responsibilities of Company (Owners/management) Workers Committee/Union Joint Body It is important to note that the certification body, FLO-Cert. GmbH, uses a set of specific indicators during the inspection and certification process in order to measure compliance with standards. Studying these indicators will further ease the understanding of the specific requirements to be fulfilled. Related information can be obtained from FLO-Cert. GmbH directly. 1. Social Development 1.1 Development Potential and Capacity Building This section emphasizes the aim of Fairtrade on plantations: the social welfare and empowerment of the workers. Its intention is to make sure that the company shares the principles of Fairtrade and has taken all possible measures to implement the Fairtrade programme successfully. Special attention is given to the information and awareness creation on Fairtrade Minimum Requirements FLO expects that a company that is joining Fairtrade shares the principles of Fairtrade and has them incorporated in its own policy. The Fairtrade requirements should not be seen as an external imposition that goes against the primary business goal to make money. FLO expects that its business partners, by their own choice and conviction, take a social and environmental commitment. The standard clause reminds the company that by joining Fairtrade it takes upon itself a great deal of obligations towards the stakeholders and particularly towards the workers. The intention of this standard clause is also to avoid that companies enter into Fairtrade purely for commercial reasons and consider the Fairtrade requirements more an annoyance than a welcome challenge to enhance their own practice. The guidance addresses the three main actors: owners, senior management and middle management, because all these three levels must share the Fairtrade philosophy and support the implementation of the Fairtrade programme in their sphere of responsibility The intention of this standard clause is to make sure that the implementation of the Fairtrade requirements is done systematically and monitored regularly. The Fairtrade officer as the overall coordinator of Fairtrade in the company should manage the Fairtrade agenda: Tasks, responsible persons, deadlines; he/she should make sure that the information flow on Fairtrade issues within the company is functioning, that work plans are elaborated and implemented, and that corrective actions are taken in time. His/her responsibility is also the timely communication with FLO. To avoid misunderstandings: The Fairtrade officer is not supposed to take decisions, this is the attribution of management (according to the lines of command) with regard to company business and of the Joint Body with regard to the Fairtrade Premium. He/she just reminds the decision-makers when decisions must be taken and monitors the execution of the decisions. And he/she regularly informs the Chief Executive about achievements and problems The companies should invest the additional revenue generated by Fairtrade in the welfare and development of the workers. The progress requirements indicate the areas where Introduction into the Generic Fairtrade Standards for Hired Labour 14 of 30

15 improvements are expected. The company workplans are the tool for ensuring and monitoring progress continuously. The higher the Fairtrade revenue (sales volumes and minimum price) the faster and deeper progress should be. Implementation of the workplans should be periodically assessed. What kinds of company workplans are requested? The standards make several references to workplans, which should cover the following subjects: Workplan for social improvement ( ) The medical workplan ( ) The Health and Safety workplan ( ) The environmental plan ( ) These company workplans are the responsibility of management. They are different from and should not be confused with the Fairtrade Premium workplan, for which the JB is responsible (2.1.8) Understanding Fairtrade and its requirements is a precondition for correct implementation. Since all levels of the company are involved, awareness building must take place on all levels. This is most important at the beginning, before implementation of the Fairtrade programme starts. The training is given during working hours. This is particularly true for middle management and supervisors, who often are not well informed on the Fairtrade requirements and the rationale behind them, (why all these committees and meetings, which take time away from the work we should do?). So it may happen that instead of being supportive they are against Fairtrade and harass their subordinates when they need to carry out Fairtrade duties. Also the primary beneficiaries of Fairtrade, the workers, must be informed of the benefits of Fairtrade for them: First the protection of their rights as contained in the social standards and second the Fairtrade Premium. The FLO liaison person may be requested to help organizing the training and identifying trainers Both Joint Body and the Workers Organization (WO) 3 have important but different roles in the Fairtrade concept: The JB administers the Fairtrade Premium and decides on the use of the Premium, while the WO defends the rights and interests of the workers vis-à-vis management. Sometimes the roles of both committees get mixed, although they are clearly described in the Fairtrade standards 4. It is therefore important that everybody in the company, from management to workers, knows the functions of both committees and understands the difference between them To do their job, the committees, particularly JB and WO, need time, space and other facilities. It is understood that the company considers the work of the committees as part of the normal business operations. Therefore it should grant the time for meetings and indispensable duties of committee members during working hours. Workers assisting such meetings should not suffer from any disadvantage, for instance being obliged to finish their tasks after working hours without compensation. It is recommendable that the company, together with the committees, establish a meeting calendar for the whole year as well as clear and fair rules on the use of working time for committee duties The intention of this standard clause is to make sure that the company has the facilities necessary for the normal handling of its marketing operations Progress Requirements The standard clause refers to the company workplan already mentioned in This workplan is the responsibility of management; however, the workers, through their organization (WO), should be consulted and over time contribute with their ideas and suggestions. There is a precise timeframe for compliance: not later than one year from 3 ILO Convention 110 defines the term Workers Organization as follows: Any organization of workers for furthering and defending the interests of workers. It can be a union or a workers committee. 4 WO in section 1.4, JB in chapter 2 Introduction into the Generic Fairtrade Standards for Hired Labour 15 of 30

16 certification The standard has two parts: 1) For children of permanent workers who live in the company compound, the company must facilitate primary school education not later than one year from certification. 2) The company should pay special attention to the education of all workers children (of seasonal workers, non-resident permanent workers, etc.). The guidance gives examples where the company is encouraged to support education. Since there is no timeframe, progress depends on the company s ability and willingness, according to its workplan for social improvements This standard clause is closely related to Its intention is to deepen the understanding of Fairtrade through additional training, following the initial awareness programme prior to certification. During the first year from certification management thus must ensure an intensive training programme, as detailed in the guidance column, throughout the company. The specific training for the workers ideally should be organized by the workers themselves (JB and WO, respectively) with the support of management. This training should be conducted by qualified trainers who are independent from the company. The company supports this training also by giving working time and a financial contribution. The FLO liaison person may be requested to help organizing the training and identifying trainers Quality management is an important tool for monitoring quality of processes and output. The basic system should be established not later than one year from certification. It can be refined and improved over time Human resources management is not only personnel administration. It is an integrated approach to human resources, recognizing that human capital is the most valuable asset of a company. Effective human resource management is particularly required for supporting compliance with the part of the Fairtrade standards related to social development. 1.2 Freedom from Discrimination Millions of women and men around the world are denied access to jobs and training, receive low wages, or are restricted to certain occupations simply on the basis of their sex, skin colour, ethnicity or beliefs, without regard to their capabilities and skills. Freedom from discrimination is a fundamental human right as laid down in the Universal Declaration of Human Rights. In relation to employment and work it is essential for both men and women workers to choose their employment freely, to develop their potential to the full and to reap economic rewards on the basis of merit. The elimination of any form of discrimination is a core principle of the ILO. It is already laid down in the Declaration of Philadelphia, which states that "all human beings, irrespective of race, creed or sex, have the right to pursue their material well-being and their spiritual development in conditions of freedom and dignity, of economic security and equal opportunity". The principle is further developed in ILO Convention 111 on discrimination in employment and occupation. The scope of this Convention is very wide and includes access to training and employment as well as the terms and conditions of employment. Discrimination is an unfair distinction on grounds not related to the capacities needed for a specific job. It can be exclusion of one person (or group) or preference for a person (or group) over another. Non-discrimination, then, means equal opportunity (for a job, for instance) and equal treatment in all aspects of the workplace. In addition to Convention 111, Convention 100 lays down the principle of equal Introduction into the Generic Fairtrade Standards for Hired Labour 16 of 30

17 remuneration for men and women workers for work of equal value Minimum Requirements The standard clause enumerates the possible grounds for discrimination (race, sex, religion, etc.), enlarging the list given in the ILO Convention 111. It prohibits, explicitly, discrimination on the basis of membership in the Workers Organisation or in the Joint Body. It also enumerates the main possible areas where discrimination may occur (recruitment, promotion, etc.); however, it is not applicable to these areas only, but to all aspects of the workplace. The guidance s reference to endemic discrimination means common and widespread discrimination of certain groups (e.g. women, religious or ethnic groups, castes, migrant workers) Corporal punishment, verbal abuse, harassment etc. are forms of arbitrariness and therefore come under discrimination. To avoid arbitrary punishment, the guidance recommends establishing a disciplinary code or sanctions procedure, which is clearly communicated to the workers. To avoid discrimination, this code should contain: The enumeration of misconducts and a ranking of misconducts by gravity The sanctions corresponding to each category of misconduct. Sanctions are more severe for serious misconduct and in case of repeated offence The naming of the person or rank within the company entitled to sanction An appeal procedure with involvement of the workers representatives (WO) The standard clause refers to sexual harassment (against women and men), an offence quite common at the workplace. The company must have a policy to prevent sexual harassment. It should include a procedure to effectively assist harassed persons in a form which respects their right for anonymity and a system of records. The first step is creating awareness among the workforce and the clear assertion of management that sexual harassment will not be tolerated and will be prosecuted Workers who use any grievance procedure to deposit a complaint shall not be harassed or punished as consequence of complaining. Although the establishment of a formal grievance procedure is a progress requirement (see ), the company should always offer its employees the possibility to make suggestions for improvements or to complain, either personally or through a workers representative, without the fear of being disciplined Progress Requirements The standard clause aims at enhancing the professional qualification of the workers, particularly of disadvantaged and minority groups The standard clause emphasizes the right to equal opportunities for women, a group often disadvantaged at the workplace. The company is required to pay special attention to the empowerment of women with the goal to achieve gender equity The standard must be seen in close relation with above and now refers specifically to sexual harassment against women, the most frequent victims of sexual harassment. Special measures are required to protect women from sexual harassment. 1.3 Freedom of Labour This section deals with forced labour and child labour. Although forced labour is universally condemned, the ILO recently estimated that at least 12.3 million people are victims of forced labour worldwide. Not only is forced labour a serious violation of a fundamental human right, it is a leading cause of poverty and a hindrance to economic development. Forced labour has many faces: Traditional slavery, coercive recruitment by states or rebel military groups, domestic workers who are restrained from leaving the employer s home, bonded labour to pay debts (their own or their ancestors ), human traffic for prostitution and sweatshops, or simply for punishment. Introduction into the Generic Fairtrade Standards for Hired Labour 17 of 30

18 Freedom from forced labour is laid down in the Universal Declaration of Human Rights and is a core principle of ILO, ratified in the Forced Labour Conventions 29 and 105, the primary international tools for fighting this problem. Convention 29 prohibits all forms of forced or compulsory labour, which is defined as "all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily." Convention 105 prohibits forced or compulsory labour as a means of political coercion or education or as a punishment; as a method of mobilizing and using labour for purposes of economic development; as a means of labour discipline; as a punishment for having participated in strikes; and as a means of racial, social, national or religious discrimination. Additionally, child labour is considered as one of the worst forms of forced or compulsory labour. Child labour is a violation of fundamental human rights. There is a strong link between poverty and child labour, and child labour perpetuates poverty across generations by keeping children of the poor out of school and limiting their development, potentially leading to lifelong physical or psychological damage. The abolition of child labour is one of the four core principles of ILO, and it is addressed in ILO Conventions 138 and 182. Convention 138 sets the general minimum age for admission to employment or work at 15 years and the minimum age for hazardous work at 18. Convention 182 defines as a "child" a person under 18 years of age. It requires eliminating the worst forms of child labour, including all forms of slavery or practices similar to slavery, and work which is likely to harm the health, safety or morals of children Minimum Requirements The standard clause prohibits forced and bonded labour in all its forms, even subtle forms of limiting a worker s freedom to leave the job (such as retaining payment, documents, loans with excessively high interests, etc.). Also, obliging a worker to work unpaid extra time as a form of punishment is not allowed The standard clause prohibits child labour, i.e. employment of children below 15. If, by the time of certification, the company employs children, it must abandon this practice within one year. In this case the company must ensure that the children it employed before are not worse off now and can attend school The standard clause applies to children between 15 and 18. Work must not hinder children to finish compulsory school. The company should have special working conditions for young persons, including limitation of the hours spent at work and the prohibition of overtime, so as to allow enough time for education and rest Workers below the age of 18 must not do work that implies hazardous, unsafe or unhealthy conditions. These can be (a) work which exposes children to physical, psychological or sexual abuse; (b) work underground, under water, at dangerous heights or in confined spaces; (c) work with dangerous machinery, equipment and tools, or which involves the manual handling or transport of heavy loads; (d) work in an unhealthy environment which may, for example, expose children to hazardous substances, agents or processes, or to temperatures, noise levels, or vibrations damaging to their health; (e) work under particularly difficult conditions such as work for long hours or during the night or work where the child is unreasonably confined to the premises of the employer The standard clause prohibits a special case of bonded labour: employment is given only under the condition that the spouse works in the same establishment. 1.4 Freedom of Association and Collective Bargaining Introduction into the Generic Fairtrade Standards for Hired Labour 18 of 30

19 The principle of freedom of association is a right proclaimed in the Universal Declaration of Human Rights. It is also at the core of the ILO's values: it is enshrined in the ILO Constitution, the ILO Declaration of Philadelphia, and the ILO Declaration on Fundamental Principles and Rights at Work. The right to organize and form employers' and workers' organizations is the prerequisite for sound collective bargaining and social dialogue. Collective bargaining practices ensure that employers and workers have an equal voice in negotiations and that the outcome will be fair and equitable. The ILO has developed the right of freedom of association and collective bargaining in many conventions and other documents. The most important are Conventions 87, 89, 135 and 154, as well as Recommendation 143. The subject is also dealt with, among many other matters, in Convention 110, the so-called Plantations Convention. Convention 87 sets forth the right for workers and employers to establish and join organizations of their own choosing without previous authorization. They shall organize freely, i.e. draw up their constitutions and rules, elect their representatives and formulate their programmes. They have the right to establish and join federations and confederations, which may in turn affiliate with international organizations. Convention 98 protects workers against anti-union discrimination and interference by the employer, in particular the establishment or financing of workers' organizations under the control of employers. The convention also enshrines the right to collective bargaining. Convention 110 defines the term workers organization as follows: Any organization of workers for furthering and defending the interests of workers. Convention 135 requires that workers' representatives shall enjoy effective protection against any act prejudicial to them, including dismissal, based on their status or activities as a workers' representative or on union membership or participation in union activities. The convention defines the term workers representatives, whether as trade union representatives or as representatives who are freely elected by the workers. It also determines that workers' representatives shall be afforded facilities appropriate to enable them to carry out their functions. Recommendation 143 elaborates further on the rules on protection of workers representatives and lays down a series of protective measures. Convention 154 defines collective bargaining and calls for its promotion in all branches of economic activity, including public service Minimum Requirements Management must recognize the principle of freedom of association and collective bargaining in a written statement. This can be in the company s mission or policy statement, or in the company rules and regulations. In any case it should always be clearly communicated to the workers. In practice this means: (a) the company did not oppose the establishment of a workers organization in the last 2 years prior to application for Fairtrade certification; (b) there should be as a minimum a democratic workers representation and regular dialogue with management at the time of certification The standard clause refers to companies where no union exists. In this case, management must allow an information meeting of union officials with the workers on the company premises on request either a) from the workers or b) from a union that has signed a CBA in the respective industry or on national level For successful implementation of the Fairtrade programme, an independent and active Introduction into the Generic Fairtrade Standards for Hired Labour 19 of 30

20 workers organization is necessary to defend the workers rights and interests at the workplace. If a union exists in the company, this requirement is fulfilled. If no union exists and no recognized union is active in the area, or the workers do not wish to join a union (this decision must be free, not taken under pressure from management), then a Workers Committee must be elected The standard clause protects workers and their representatives from discrimination or victimization for using their right to organize and for defending their rights. It covers not only union members, union representatives (shop stewards), and members of Workers Committees, but also Joint Body members and other committees established to work for the workers rights and welfare, e.g. Health & Safety committees The standard clause prohibits interference of management in matters of workers organization (union or workers committee), to control or obstruct them. The clause does not apply to the Joint Body, of which management is part by definition The prohibition to interfere or obstruct particularly applies to the meetings of the workers organization. Management must allow meetings to be held during working hours and not interfere with them. They can assist meetings of the workers or the workers organization only if they are invited. Management is requested to support the functioning of the workers organization also by providing facilities Work pressure, particularly during peak times, may hinder that meetings are held regularly or workers can assist. To avoid friction between production targets and the need for meetings, the establishment of a meeting calendar for the whole year is recommended. This calendar, once approved by management, must be respected by all parties; agreed meetings are considered as part of the operation of the company and attendance is mandatory. To avoid unnecessary tensions, however, it will be useful to agree on a certain flexibility in the meeting schedule in order to be able to address unforeseeable issues if required Regular dialogue and negotiation between management and the workers organization is putting in practice the right to collective bargaining and an effective instrument to maintain good industrial relations Progress Requirements The workers should know the different forms of workers organization that exist and the pros and cons of each option. This information must be offered within one year of certification from an independent source. Independent in this context means free of management interference or control If the company has not yet signed a CBA and a CBA exists for the respective industry, management must sign this sector CBA not later than one year from certification The standard clause together with the guidance has three elements: (a) If no CBA exists management must encourage the workers organization to enter into negotiations on the conditions of employment, taking the progress requirements as reference. (b) Both parties should consult a national or international trade union federation for improving the negotiation process. (c) If this negotiation and consultation process does not result in a formal CBA, management and the workers organization should sign an agreement covering the subjects normally covered by a CBA (salaries, rules and regulations, etc.) The standard clause refers to capacity building in the field of the workers organization as defined in It requires ongoing training to steadily improve the workers capacity and participation, but also management s ability on all levels to handle industrial relations. The training for workers should come from an independent source, as defined in The standard requires the establishment of a formal grievance or complaint procedure, as mentioned in the comment to The grievance procedure is different from the appeal procedure for defence against unfair disciplinary measures, which must be part of the Introduction into the Generic Fairtrade Standards for Hired Labour 20 of 30