A cross-country
comparison which finds ‘Strong evidence that countries with open trade policies
have superior labor rights and health conditions and less child labor’
(Flanagan 2004: 26) suggests that openness to the world economy does not
undermine workers’ rights and may even enhance them. However, the finding that
in any particular country openness to the world economy can go with high labour
standards is not incompatible with the proposition that globalisation as a
process undermines labour rights globally.
One process by which this could and does take place is by the transfer of production from countries with higher labour standards to countries with lower standards, leaving workers in the former unemployed. Thus in developed countries, jobs in the labour-intensive textile and garment industries have been decimated as production shifted to developing country export sectors (Williams 2004; Narendranath 2004). This has also caused job losses in developing countries, when production moved from higher-wage countries like Korea to lower-wage ones like Cambodia. Outsourcing in the service sector led to further transfer of employment from developed to developing countries, leading to calls for a curb on outsourcing in the US (Alden 2004).
A less obvious,
more insidious way in which labour standards are undermined is by the spread of
low labour standards to countries which did not formerly suffer from them, or
at least not to the same extent. The global expansion of informal labour –
workers who do not have any formal employment contract with an employer and
therefore are extremely vulnerable to abuse – is a case of this. Informal
labour was always preponderant in India, but the expansion of homeworking,
sweatshops, and the hiring of workers through intermediaries (‘labour
contractors’, ‘agencies’, ‘gangmasters’ and so on) in countries which were
formerly free of these problems (Mather 2005) has caused serious concern within
the ILO in the 21st century (ILO 2002).
In this context, the publication of International Trade and Labor Standards, with its carefully crafted proposal for a linkage between trade and labour standards that is both feasible and capable of stopping the downward pressure on labour standards, is of great importance. The authors have taken up objections to linkage in a step-by-step manner in order to formulate a proposal that meets almost all the arguments against it that are commonly put forward. This paper is an attempt to strengthen it by tackling some of the few remaining weaknesses.