Developing countries and legal regulation of transnational corporations' employment and labour relations practices
Chapter 1. Developing countries and TNCs This chapter serves as a general introduction on the issue of TNC regulation in developing countries. The issues covered in it include the definition of a TNC, statistics on such issues as the scale and significance of TNC investment, factors influencing the bargaining strength of the corporation vis a vis the host state and the institutional and legislative response to the TNC challenge. (The questions of Nationalization and Transfer Pricing in view of their far-reaching implications as well as their contentious nature on investor/host country relations are given a fairly detailed treatment in this introduction). Chapter 2. Labour Issues This chapter discusses labour issues that arise in the context of TNC operations in developing countries. Focus is mainly on three basic issues: TNC impact on employment, conditions of work and industrial relations (conditions of work are treated briefly here but in greater detail in the next two chapters.) Chapter 3. 'Export Processing Zones' This chapter focuses on conditions of labour in TNC plants located in special zones created by some developing countries in order to attract foreign investment. The chapter also contains selected short country studies to illustrate how labour/management relations are regulated by countries that have opted for this road to 'development*. The final part of the chapter discusses what is being done at international level to help improve the fate of workers in these zones or in enterprises that may be outside such zones but which in law or practice enjoy similar status with enterprises in those zones. Chapter 4. National Regulation of TNCs in Developing Countries: The case of Bhopal Gas Leak Disaster. The chapter seeks to illustrate and evaluate, in the light of the Bhopal experience, the type of problems that developing countries may confront in their efforts to regulate the social implications of TNC operations in these countries. The approach of the national authorities and other regulatory institutions, as represented by India in this case study, to such problems is also discussed and evaluated. The chapter can be divided into five parts. The first part is an introduction, the second part outlines key issues, from the point of view of our enquiry, and discusses some of the legal questions arising therefrom. The third part discusses in-house safety management at Union Carbide in so far as it is relevant to the Bhopal plant. The fourth part deals with Indian government regulation of the plant. The fifth part deals with options, under Indian law to hold the extra-territorial legal parent of the Indian subsidiary responsible for the damage caused by the accident, as well as the policy implications of exercising such options. (It is important to stress that the chapter is about regulation and not about liability as such. Liability questions are raised only in so far as they are regarded as incidental to our discussion on regulation.) Chapter 5. In Search of an International Regulatory Frame-Work on TNCs. The chapter is intended as an introduction to the issue of international regulation of TNCs, which is the main subject of the remaining part of this work. It is essentially a review of efforts by developing countries and the the international labour movement to create a force, at the international level, to match the power of TNCs, as well as the attitude and responses of the TNCs and their home countries to those efforts. The chapter is divided into two sections. Section A, discusses labour movement initiatives, in particular the largely unsuccessful attempts at creating transnational forms of bargaining with TNCs. Section B, discusses developing countries' initiatives, within the UN System, to establish an international machinery for regulation of TNCs. The economic philosophy that guides these efforts as well as legal principles regarded by these countries as being more in line with their aspirations on these matters, are matters also discussed. Chapter 6. Codes of Conduct on TNCs and The Law. This chapter discusses the legal status and effect of international Codes of Conduct on TNCs, at municipal as well as international law. The main focus is on the 'declaration' type instrument, which is the legal form taken by ILO Tripartite Declaration Of Principles Concerning Multinational Enterprises and Social Policy. Other types of non-binding instruments, including resolutions and recommendations, are also discussed. The circumstances in which these instruments may become binding sources of law are also briefly reviewed. (The contents of such codes and the state practice in relation to such contents is not discussed here. A discussion of these questions is the subject of the next chapter). Chapter 7. The ILO Tripartite Declaration. The subject of this last substantive chapter is a discussion on the most important international instrument on regulation of TNC social policies and practices in developing countries, the ILO Code on TNCs. The chapter is essentially our assessment, in the light of evidence reviewed here, of the adequacy of this instrument, including its implementation mechanism, in coping with the problems identified as pertinent in this work. The chapter can be divided into three parts. The first part outlines briefly the history of the instrument. The second part deals briefly with the contents in so far as they are relevant on the labour issues that have emerged as important in the context of this work. The third part is a detailed discussion on the implementation of the instrument at the national as well as the international level. Chapter 8. Conclusions and Reflections.