News from EPI › EPI Press Release

June 4, 1999

Contact:  Brian Lustig (202) 331-5530 or Nan Gibson (202) 331-5546

JUNE 1999

PRESS RELEASE

U.S. MUST TAKE UNILATERAL ACTION TO LINK WORKER RIGHTS TO TRADE AND INVESTMENT AGREEMENTS

Despite laws and rhetoric, workers not given same protection as international investors in multilateral negotiations

Washington, D.C. – In order to guarantee that international worker rights are protected in existing and future multilateral trade and investment agreements, the U.S. government must take unilateral action with respect to bilateral agreements and to its participation in international trade and finance agencies, according to a report by the Economic Policy Institute (EPI).

In Certifying International Worker Rights: A Practical Alternative, EPI Research Associate and Professor of International Law, Washington College of Law, American University Jerome Levinson outlines the obstacles currently hampering U.S. negotiators in their attempt to certify international worker rights into multilateral agreements such as NAFTA and WTO. Levinson puts forth an aggressive proposal to push core worker rights to the forefront of the multilateral negotiating agenda and prevent further erosion of U.S. domestic labor legislation.

Efforts to incorporate core worker rights into multilateral agreements have failed for two reasons, according to Levinson. First, despite support for worker rights in U.S. legislation, the American negotiators of these agreements have not been willing to give worker rights the same protection afforded to international investors. Second, sensing that reluctance, opponents of worker rights have been able to muster majorities against them in multilateral negotiations.

Rhetoric pressed by U.S. negotiators at multilateral venues such as NAFTA and WTO have failed to persuade other nations to agree to stronger action on labor rights. Part of the breakdown lies in the U.S. government’s unwillingness to make core worker rights a priority objective. U.S. negotiators have considered inadequate protection of corporate property rights to be a “deal-breaker” for any trade or investment agreement. The same is not true when it comes to worker rights. Therefore, developing nations need only accommodate U.S. corporate interests at the bargaining table.

Levinson suggests that the only way to convince developing countries to come to the table for serious negotiations over core worker rights is to take unilateral action to certify international worker rights. According to the author, this unilateral action must encompass the following measures:

  • Trade preferences should be offered only to countries that demonstrate that their labor legislation and practices enable workers to effectively exercise core worker rights. These preferences should no longer be extended generally to a group of countries defined by per capita income or geographic location alone;
  • Incentives that perversely discriminate against core worker rights should be reversed. Countries presently engaged in a brutal competition to attract the same pool of Foreign Direct Investment often feel compelled to repress worker rights. The U.S. should encourage a race to the top, not the bottom; therefore only the country that assures that workers can exercise core rights would receive trade preferences; and
  • U.S. trade law should be changed to require that the Secretary of Labor certify that a country’s workers can exercise core worker rights before trade preferences are granted. The Secretary would in turn rely on the International Labor Office’s (ILO) evaluation of the state of enforceable labor rights around the world.

Although a labor rights certification process would not by itself level the unequal playing field between workers’ and investors’ rights in the global economy, Levinson argues that strengthening the roles of the U.S. Department of Labor and the ILO would give much needed leverage to agencies concerned with human values in the global marketplace.

“The overriding (U.S.) policy priority has been the security and mobility of capital,” says Levinson. “Public discussion of core worker rights and their relationship to trade, investment, and finance in the context of concrete country situations would broaden the base of participation on these issues,” he concludes.

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Jerome Levinson is Professor of International Law, Washington College of Law, American University. Levinson is author of the EPI reports New Priorities in Financing Latin American Development: Balancing Worker Rights, Democracy, and Financial Reform (1994); and The Labor Side Accords to the North American Free Trade Agreement (1993). He also contributed to the EPI publication Reclaiming Prosperity (1996).

For more information, contact:

Nan Gibson (202) 331-5546

Brian Lustig (202) 331-5530

The Economic Policy Institute is a nonprofit, non-partisan economic think tank based in Washington, D.C. Founded in 1986, EPI seeks to widen the debate about policies to achieve healthy economic growth, prosperity and opportunity in the U.S.

To order copies of Certifying International Worker Rights: A Practical Alternative, contact EPI at 1-800-EPI-4844 or order online.