Legal Hurdles II: Problems of Jurisdiction
Last time, I got feedback that my blog was too technical, so while this time I am again looking at a piece of proposed legislation, The Decent Working Conditions and Fair Competition Act (US), I’ll try to analyze it from a more political perspective (which is more relevant in this case anyway).
The main issue I’m interested in with regard to this legislation is its motivation and the implications for how effective it might be. This will lead to, as promised, issues of jurisdiction.
When I first glanced at this legislation, what struck me was that it was supported by the AFL-CIO and the United Steelworkers Union. It also seemed strange that legislation of this type was being proposed under the current administration. So, I did a bit of digging. Turns out that the Congressional Sponsors of the Bill are all Democrats, and many of them are from states that have or have had significant manufacturing industries (Ohio, California, Texas, etc.). Furthermore, if you recall, the Bush Administration passed protectionist measures in favour of the steel industry in 2002 (which were subsequently ruled illegal by the World Trade Organization), and the textile industry heavily lobbied the Administration for measures to protect it even before the abolition of quotas in 2005.
I then ran a Google search on the Bill to see if there has been any commentary on it in the media. Whereas a similar search on the UK’s corporate manslaughter bill (which is apparently dead in Scotland…) turned up a number of articles with critical analysis from the BBC, the Guardian, and the like, I had no luck with the US Bill in finding commentary from US news sources. This lack of analysis might be due to the fact that the bill is not likely to pass, but what did come up were highly complimentary articles from small, local papers and promotional statements from union websites.
So all that was left really was to look at the text of the Bill itself. Right away, the title is striking. It not only mentions decent working conditions but includes fair competition as well. A look through section 2 suggests that the drafters of this Bill were pretty serious about the latter point, as 3 of the 9 justifications for the Bill present in this section pertain to unfair competition. Section 2(a)(6) says that businesses have the right to be free from competition with companies that use sweatshop labor. Section 2(a)(8) states that it is a deceptive trade practice and a form of unfair competition for a business to sell sweatshop goods. And section 2(a)(9) then concludes that not dealing with sweatshop goods, regardless of source, is consistent with U.S. international obligations and applies equally to domestic and foreign products thus avoiding discrimination among foreign sources. This clause suggests that the Bill recognizes the many sweatshops actually operating in the U.S. right now; thus the non-discrimination element… Only, this number is probably far lower than the number in, say, China. In European law, this approach might be termed an “indistinct” measure. In other words, at face value, it is not discriminating against other countries, but its real effects result in such discrimination. So what’s the problem with discriminating against countries that have sweatshops (other than the fact that the US has them too)? Before I get into this, I’ll raise just one other point about the legislation.
This aspect of the law is particularly interesting. The Bill proposes to amend a number of federal acts, among them section 202 of the Federal Trade Commission Act. This section defines who has standing under this Bill. In other words, it sets the guidelines for who is eligible to sue under the law. It would seem logical that workers could sue for decent working conditions, but workers are not recognized as having standing here. While the FTC would investigate worker complaints under this Bill, the only parties with standing to sue would be competitors of retailers of sweatshop goods and investors in retailers of sweatshop goods. You might say it’s a jurisdiction issue as workers in foreign factories won’t find the right to sue in a U.S. court. Besides this not being entirely true, what about workers in U.S. sweatshops?
At this point, I’d like to raise a larger point about jurisdiction that will hopefully also address why discrimination against other countries with lots of sweatshops is a problem under this proposed legislation. To me, it seems pretty clear, as you’ve no doubt gleaned, that this legislation stems from special interests with protectionist aspirations. And while it’s pretty hard to condemn a law that purports to protect working conditions, this legislation highlights the difficulties of trying to do so solely at a domestic level. OK, let’s say that this legislation passes and succeeds in boosting U.S. manufacturing so that U.S. workers are better off. That’s great, no question. A lot of U.S. workers have suffered badly from the globalization of trade and it would be fantastic to see them get good, stable jobs in good conditions. But what about the workers in China, Indonesia, Jordan (as an aside, the momentum for this legislation appears to have grown out of a National Labor Committee expose of terrible working conditions in Jordanian factories)? There are no specifics in the legislation about how to encourage improvement at facilities overseas – it offers just a cut and run approach, which won’t solve anything and will probably make things worse. In short, it fails to deal at all with decent working conditions and addresses only the unfair competition element of its stated intent. While the U.S., from one perspective, does not have an obligation to fix other countries’ problems, surely it has an obligation not to exacerbate them by robbing them of trade and labor opportunities. It could be that I’m overstating the problem of the Bill’s origin stemming from protectionist sentiment, and I hope this is the case, but given the orientation of the text, it seems like it is a significant problem, especially given the strange juxtaposition of protectionist language and looking to international standards and obligations as justification for it.
Jurisdiction is a problem because while there are domestic tools to address one country’s place in the global trade regime, the main international tool dealing with these arrangements, the World Trade Organization, does not account sufficiently, if at all, for human rights and labor considerations in its forum. And while a few bilateral trade agreements have incorporated labor rights requirements, so many countries are affected by this problem that even this attempt at reciprocity does not seem appropriate. But while we can push for a global, multilateral approach to trade and human rights, the reality is that there is no viable global jurisdiction to look to at present.
To be a bit fair, this Bill does contain many positives: recognition of the ILO core conventions (of which the U.S. has ratified only 2 of 8, so one wonders actually if passage of this Bill might be a formal ratification of the rest of these standards), the recognition of sweatshops as morally offensive and degrading to workers, the right of workers to sweat-free conditions, the wide range of stakeholders affected by poor labor standards, ethical procurement requirements by the U.S. government, and the need for competition to occur on fair footing. Unfortunately, it is unclear how these measures could be implemented as the conceptual framework of the problems as outlined in the Bill is overly simplistic and does not offer concrete, effective solutions. Sadly, until there is an effective international regime to support human rights globally, such measures will remain prone to protectionist motivations and special interests that, while often reflecting justified concerns, can jeopardize the rights of others.
