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Standing Up for Workers: Ensuring that the Benefits of Trade are Broadly-Shared

Protection of worker rights is one of the highest priorities of the Obama Administration’s trade agenda.  From bringing the first-ever labor case under a free trade agreement, to working with Burma on a new labor rights initiative, to developing roadmaps to address serious worker rights concerns in Bangladesh and Swaziland, to negotiating the highest-ever labor standards with the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP) countries, which represent nearly two-thirds of the global economy, the Obama Administration is taking unprecedented strides to promote respect for internationally recognized labor rights.  The challenges are great, and overcoming them will require sustained progress across all of the Administration’s initiatives.  But we are committed to staying the course, to ensure that the benefits of trade are broadly shared.

Free Trade Agreements

Guatemala: The Administration initiated a case under the Dominican Republic-Central America-United States Free Trade Agreement to address concerns that Guatemala was not effectively enforcing labor laws relating to the right of association, the right to organize and bargain collectively, and acceptable conditions of work.  This case, the first to be initiated under any free trade agreement, was brought after extensive engagement with Guatemala failed to resolve the concerns.  After initiation, Guatemala and the United States negotiated an “Enforcement Plan” and the United States suspended the case to give time to Guatemala to implement the Plan.  Guatemala thereafter took several important steps to improve compliance.  However, critical commitments by the government intended to ensure effective enforcement remain outstanding and sufficient concrete change to the benefit of workers on the ground is not yet evident.  As a result, on September 18, 2014, the Obama Administration decided to proceed with the case against Guatemala.  The Administration will continue to press forward until Guatemala meets its obligations and demonstrates that conditions have improved on the ground for workers.

Colombia:  President Obama identified a number of serious labor concerns in Colombia that he insisted would need to be addressed before submitting the U.S.-Colombia Trade Promotion Agreement for Congressional approval.  These included concerns about violence against Colombian labor union members, inadequate efforts to bring the perpetrators of such violence to justice, and insufficient protection of workers’ rights.  In April 2011, the United States and Colombia agreed to a detailed Labor Action Plan to address the concerns raised by the Obama Administration.  Since then, Colombia has made meaningful progress to implement the plan, including passing laws that strengthen worker rights protections, hiring hundreds of new labor inspectors to expand enforcement of labor laws and regulations, hiring and training one hundred new police investigators and over twenty new criminal prosecutors to focus on cases of violence against unionists, and taking enforcement actions to combat abusive third-party contracting, including the assessment of significant fines against violators.  At the same time, more work remains to be done to fully implement certain aspects of the Action Plan, including collection of assessed fines, prosecution of recent labor homicide cases, and combatting newer forms of abusive contracting.  The Obama Administration is working closely with the Colombian government to address these areas of concern.

Jordan: In 2013, to address concerns about worker rights and working conditions in Jordan’s garment sector, the United States and Jordan agreed to an Implementation Plan Related to Working and Living Conditions of Workers.  The plan includes commitments by Jordan to increase access for unions in garment factories and improve standards and oversight of dormitories for foreign workers.  As a result, Jordan has issued new standards for inspecting dormitories at garment factories and submitted new labor legislation to its parliament in the areas of collective bargaining, trade union rights, employment discrimination and payment of wages, and Jordan’s Ministry of Labor has hired 45 new labor inspectors.  In addition, the International Labor Organization (ILO) has opened a state-of-the-art worker rights center in Jordan’s largest export processing zone (known as a Qualifying Industrial Zone) to support foreign workers, including on issues of sexual harassment and union representation. 

Bahrain: The United States requested consultations with Bahrain under the Labor Chapter of the United States – Bahrain Free Trade Agreement in May 2013, to address labor issues stemming from the Government of Bahrain’s response to civil unrest in early 2011, including ostensible targeting of trade unionists and leaders for firing after they conducted a general strike.  Over the past year, the United States has held two rounds of consultations with Bahrain to develop initiatives to address concerns about employment discrimination based on religious (sectarian) identity or political opinion and about labor laws that do not provide adequate protection on these issues.  These issues were the subject of a December 2012 report by the U.S. Department of Labor in response to a submission filed by the AFL-CIO under the FTA Labor Chapter.  Bahrain has made substantial progress on the issue of dismissals of trade union leaders during the civil unrest, which the ILO has recognized.  However, consultations continue to ensure that additional steps are taken to address remaining concerns on employment discrimination and legal protections for trade union rights.

TPP and TTIP: In these trade agreements, the United States is negotiating the strongest labor protections in history.  The U.S. approach not only incorporates commitments to adopt and maintain fundamental labor rights, as recognized by the ILO, and to effectively enforce labor laws, it includes first-ever commitments on forced labor and acceptable conditions of work.  The United States is insisting that these provisions be fully enforceable, including that trading partners be held accountable for failure to meet the labor obligations through the same dispute settlement mechanism and trade sanctions as the rest of the agreement.

Preference Programs

Bangladesh: In 2013 President Obama withdrew benefits under the Generalized System of Preferences (GSP) for Bangladesh due to serious violations of internationally recognized workers’ rights, particularly in the areas of freedom of association and acceptable conditions of work.  The announcement of the decision to suspend benefits was accompanied by a “GSP Action Plan” listing 16 specific and verifiable actions that Bangladesh must take to regain trade benefits.  The United States has also been working with the European Union, the ILO and other international partners under the “Sustainability Compact” on worker rights and factory safety in Bangladesh to ensure a coordinated approach on these issues.  These efforts have been matched with significant technical assistance to improve safety conditions in the garment sector and the commitment of increased resources to monitor progress by the Government of Bangladesh.

Swaziland: In June 2014, President Obama withdrew Swaziland’s eligibility under the African Growth and Opportunity Act (AGOA) trade program for failure to respect workers’ associational rights, including Swaziland’s use of security forces and arbitrary arrests to stifle peaceful demonstrations and the lack of legal recognition for labor and employer federations.  The loss of benefits will take effect on January 1, 2015.  The United States provided the Government of Swaziland five discrete, short term actions that the government must take to address the concerns and has offered to provide assistance in helping Swaziland meet these criteria. 

Haiti: Under the Haiti HOPE II legislation, the United States created a robust third party mechanism for monitoring and reporting on labor compliance at the firm level.  Firms exporting under the HOPE II program are required to adopt and maintain practices consistent with core international labor standards and Haitian labor laws.  Active oversight of exporting industries, as well as constant engagement with stakeholders, has improved working conditions in Haitian factories and directly advanced worker rights, including by requiring reinstatement of workers wrongly dismissed for organizing activities.  Technical assistance programs provided by the United States and the ILO have improved the long term capacity and sustainability of the Haitian Government and provided direct training to workers and factories on pervasive labor rights violations, such as anti-union discrimination against labor leaders and sexual harassment of garment workers.

Other Interventions

Burma: The Administration recently announced a Labor Initiative for Burma, which will establish a global partnership to advance labor rights and protections for workers in Burma. This innovative engagement represents a multilateral, multi-stakeholder approach to strengthening labor reform, enforcement, transparency, and domestic stakeholder consultations.