Memorandum submitted by the UFCW
INTRODUCTION
The United Food and Commercial Workers' International
Union (UFCW) is the largest private-sector trades union in the
USA, representing 1.3 million employees in grocery retailing,
food processing and meatpacking. More than half of our members
are women and a significant proportion are from ethnic minorities.
We seek to protect the rights of some of the lowest-paid employees
in America.
The UFCW is pleased to offer a submission to
the Joint Committee on Human Rights on the subject of business
and human rights. Our submission focuses on the responsibility
of businesses to respect human rights abroad, and on the need
for effective access to remedies for breaches to these rights.
We limit our evidence to issues concerning fundamental employment
rights, notably freedom of association and the right to collective
bargaining.
Our submission has been prompted by our experience
of Tesco's operation in the USA, which in our opinion is in breach
both of key conventions on human rights and of Tesco's own stated
policies on human rights.
HUMAN RIGHTS
AND EMPLOYMENT
Employees are protected by two crucial human
rights conventions of the International Labour Organisation: ILO
Convention 87, Freedom of Association and Protection of the Right
to Organise (1948); and ILO Convention 98, Right to Organise and
Collective Bargaining (1949).
These two conventions allow individuals to form
and join a trades union, in order collectively to represent their
interests on matters related to their employment. Crucially, Article
1 of ILO Convention 98 states:
"Workers shall enjoy adequate protection
against acts of anti-union discrimination in respect of their
employment."
These conventions enshrine in international
law, among the signatories to these conventions, rights for which
workers have campaigned for over two centuries.
In addition, in 1998, the ILO issued a landmark
Declaration on Fundamental Principles and Rights at Work,[31]
which states:
"…all Members, even if they have not
ratified the Conventions in question, have an obligation arising
from the very fact of membership in the Organisation to respect,
promote and realise, in good faith and in accordance with the
Constitution, the principles concerning the fundamental rights
which are the subject of those Conventions…"[32]
The 1998 Declaration goes on to refer to
these fundamental rights as freedom of association and the effective
recognition of the right to collective bargaining, among others.
The Declaration ensures that states which are members of the ILO,
but which have not formally ratified the conventions, also have
a legal obligation to respect the rights set out in the conventions.
BUSINESS AND
EMPLOYMENT RIGHTS
The UK, as a signatory to these ILO conventions,
strongly upholds the rights of employees to freedom of association,
to organise and to collective bargaining. Businesses operating
within UK jurisdiction must comply with the employment laws which
enshrine these rights, and there is legal redress for employees
and trades unions when employers breach these laws.
The USA has never ratified these two conventions,
but has signed the 1998 Declaration. In theory, under US
federal employment law, employees have the right to freedom of
association, to organise or to collective bargaining and can claim
redress or protection against anti-union discrimination. However,
the practice is very different and even the United States itself
acknowledged in a 1999 report that "there are aspects
of this [US labor law] system that fail to fully protect the rights
to organize and bargain collectively of all employees in all circumstances".[33]
In fact: "Some provisions of US law openly conflict with
international norms and create formidable legal obstacles to the
exercise of freedom of association."[34]
The system that is supposed to protect workers' rights to freedom
of association and collective bargaining is in reality too lengthy
to be effective, with minimal sanctions for employers which breach
the rules. So businesses operating within the USA are able to
deny employees these fundamental employment rights with impunity.
It is therefore critical that, in the absence
of the worthwhile protection of federal law, employees enjoy protection
for these rights through other means. Firstly, in the USA, strong
trades unions, like the UFCW, have successfully campaigned to
recruit employees into the union. We use our size and resources
to persuade businesses to recognise the union for the purposes
of collective bargaining.
Collective bargaining is vitally important to
employees in the USA, principally because, under federal law,
there is no right to an employment contract (in the UK all employees
must have a contract after 13 weeks) and there is therefore
no protection against dismissal (save for specific, narrow exceptions).
Therefore, employees with many years' service can be terminated
without notice or compensation under the so-called "employment-at-will"
doctrine. For almost all employees, only a negotiated collective
agreement can guarantee legally-binding employment contracts,
setting out pay and conditions of employment, with agreed notice
and procedures for dismissal.
Secondly, many responsible businesses themselves
recognise the rights of employees contained within the ILO conventions
and voluntarily act as if these rights are in force in the USA.
Trades unions, politicians, NGOs and community groups work hard
to encourage businesses in the USA to operate within the framework
of ILO Conventions 87 and 98. It is especially expected that
international businesses based in countries which have ratified
these conventions, and which operate in their home markets under
these principles, will operate in the USA in the same responsible
manner.
TESCO AND
EMPLOYMENT RIGHTS
ABROAD
Tesco's Human Rights Policy states:
"Tesco is committed to upholding basic Human
Rights and supports in full the United Nations Universal Declaration
of Human Rights and the International Labour Organisation Core
Conventions."[35]
On employment rights, Tesco further states:
"We will treat all employees fairly and
honestly regardless of where they work. All staff will have a
written contract of employment, with agreed terms and conditions,
including notice periods on both sides."
"Employees have the right to freedom of
association and collective bargaining. We recognise the right
of our staff anywhere in Tesco around the world to join a recognised
trade union and bargain collectively where this is allowed within
national law."
In the UK, Tesco has been unionised since 1969.
In 1998 Tesco and the retail union Usdaw signed a ground-breaking
partnership agreement, the largest private-sector collective bargaining
agreement in the UK.
In 2006, Tesco announced that it was entering
the US grocery retail market and in 2007 it opened a chain
of small neighbourhood supermarkets, called Fresh and Easy. There
are now 119 stores throughout California, Arizona and Nevada,
as well as a major food preparation and distribution centre.
As a company with a very public commitment to
corporate responsibility and clearly-stated policies on human
and employment rights, the UFCW expected Tesco to operate in the
US along the same partnership lines as it does in the UK and to
respect the ILO Conventions to which it is publicly committed.
However, Tesco's approach in the USA is quite the opposite, and
we believe that Tesco is in breach both of the ILO Conventions
and of its own stated policies on freedom of association and collective
bargaining.
In 2008, the UFCW published a report, The
Two Faces of Tesco,[36]
which exposed the stark differences between Tesco's stated policies
and its behaviour in practice. Among the breaches that we highlighted
in the report was the refusal by Tesco even to meet the UFCW to
discuss allowing the union to organise among employees. This prevents
the UFCW from talking to employees in their workplace, effectively
hampering our ability openly and freely to organise within Tesco's
stores.
Tesco also advertised for an employee relations
director in the following terms:
"The incumbent has primary responsibility
for management of employee relations; maintaining non-union status
and union avoidance activities."[37]
And in clear contravention of its own policy,
Tesco provides no written contract of employment and no written
notice period for employees.
In the year since we published our report, we
believe that a number of other breaches have occurred. In response
to Tesco's repeated assurances that employees are free to join
a trades union if a majority of them want to, in September 2008 we
successfully recruited the majority of employees in one Tesco
Fresh and Easy store in Huntington Beach, California. They submitted
a written request for recognition to Tesco's US chief executive,
Mr Tim Mason, who is also a member of Tesco's corporate board
in the UK. Tesco denied that request. In so doing, the company
referred to US labour laws, a tactic that a Financial Times
article described as one that "has been successfully
used to block union organising efforts by Wal-Mart and other anti-union
US companies".[38]
In recent weeks, union representatives have
been making house calls to Tesco employees to talk about the benefits
of membership, since Tesco will not allow the UFCW access to employees
at work. House calls are a common recruiting procedure when companies
deny unions access to the workplace. During the first day of such
calls, employees responded positively to the approach. But on
subsequent days our union representatives were warned by employees
to leave their property immediately, and threatened that the police
would be called if they did not comply.
Following the house calls our Las Vegas union
office also received a number of letters from Tesco's Las Vegas
employees, requesting the union not to contact them again. All
the letters but one share the same postmark and return address:
El Segundo, California—the home of Tesco's US head office.
Las Vegas is 300 miles from El Segundo.
Based upon this and other corroborating information,
we believe that employees have been actively encouraged by Tesco
management to write these letters, that Tesco collected them together
and posted them from the same location. Moreover, we also hold
the view that Tesco management had a hand in coordinating the
responses of workers as the house calls progressed. In our view,
this is evidence of coercion and that Tesco is actively influencing
employees against involvement with our union.
Moreover, in a recent staff meeting with representatives
from all Tesco's Fresh and Easy stores in Nevada, senior Tesco
managers spoke against the UFCW. The references included a statement
that Tesco does not need a "third party" interfering
in its business, and the firm opinion that, while the UFCW is
not permitted on Tesco property, it was "despicable"
that the union would attempt to contact people at home.
The UFCW has also received reports that Tesco
is establishing "employee advocates" in its stores,
which, in our view, is not an uncommon union avoidance technique.
In a recent employer survey published by the London School of
Economics, the most common reason given for establishing such
employee consultation was precisely to avoid unionisation.[39]
Furthermore, in a Notice to Interested Parties
in relation to the establishment of a pension plan for US employees,
Tesco seems to exclude union workers in its stores from pension
benefits.[40]
The effect of the inclusion of this language serves as a deterrent
to workers who may wish to join the union and is, in the view
of UFCW, a breach of US labour law.[41]
These are just a few examples of Tesco's anti-union
activities in the USA, which we believe are in breach of the ILO
Conventions to which Tesco is publicly committed. We have more
examples, and we also know of many other examples in other countries
where Tesco operates.
We believe that Tesco's anti-union activities
not only undermine the employment rights of employees, but also
undermine the reputation of one of Britain's largest companies.
For nearly three years, the UFCW has sought constructive engagement
with Tesco, within the terms of Tesco's own stated policies of
engagement. We are drawing the Joint Committee's attention to
Tesco's behaviour to expose how a major company can, in its home
market, garner plaudits for its corporate responsibility approach,
and yet away from its home environment ride roughshod over the
very policies it publicly espouses without being held to account.
ACCESS TO
REMEDIES
In the UK, employees may take a case to an employment
tribunal if an employer infringes their employment rights, and
tribunals have considerable power to award compensation to employees
and issue notices of other remedies to offending companies. In
the USA, the National Labor Relations Board and its regional offices
fulfil a similar function, although their remit is much more tightly
drawn. Extending and protecting employment rights from employer
abuse in the USA is a matter for US democratic and legal processes
and not for the Joint Committee on Human Rights, and we do not
wish to draw a British Parliamentary Committee into US domestic
politics. In this submission, we therefore focus on some potential
remedies in the UK, which we hope could extend employment rights
under the ILO Conventions to employees of UK-based companies wherever
they are.
We would welcome the establishment of a Human
Rights Ombudsman in the UK, to which complaints could be made
about breaches of human rights by UK-based companies, including
when they operate abroad. Such an ombudsman could hear a complaint
and require an company to account publicly for its actions. While
we would prefer that an ombudsman would be equipped with the power
to direct a company to remedy its actions, we also believe that
the public exposure and negative publicity surrounding such cases
would itself encourage companies to desist from acting irresponsibly
in breaching human rights abroad.
We would also like to see the Government encourage
the corporate practice of appointing independent, non-executive
directors to corporate responsibility boards, which set policy
and monitor performance against corporate responsibility objectives,
including on human rights, whether in the UK or abroad. Tesco's
corporate responsibility committee currently comprises 16 Tesco
employees and it is chaired by the company's executive director
of corporate and legal affairs. There are no independent board
members and therefore no external monitoring of policy and practice.
In comparison, six out of the FTSE's 10 largest UK firms
have corporate responsibility committees comprised largely or
entirely of independent non-executive directors. Shell's committee,
for instance, comprises three independent non-executive board
members, one of whom is a former chairman of the Confederation
of Dutch Trades Unions.
CONCLUSION
We believe that UK-based companies which are
bound in the UK by ILO Conventions on employment rights should
uphold these rights when they operate abroad, even where the local
employment law does not require this. Tesco, which publicly states
its commitment to the ILO Conventions, is in our view in breach
of these conventions in the USA, at least in spirit, if not also
in the letter. Multinational companies have an important role
to play in spreading good practice internationally, to improve
the employment conditions of employees where the local law does
not provide these protections. We would like to see greater scrutiny
of UK-based companies in the UK on how they operate abroad, and
we would welcome the establishment of a Human Rights Ombudsman,
and the appointment of independent, non-executive directors to
company corporate responsibility committees.
United Food and Commercial Workers' International
Union
April 2009
31 ILO Declaration on Fundamental Principles and
Rights at Work, issued 86th Session, Geneva, 19 June
1998 Back
32
1998 Declaration, Preamble, paragraph 2 Back
33
US Report for the period ending 31 December 1997 under
Article 19 of the ILO Constitution on the position of national
law and practice in regard to matters dealt with in Conventions
87 and 98, US Department of Labor Back
34
Compa, Lance, "Unfair Advantage: Workers" Freedom of
Association in the United States under International Human Rights
Standards', Industrial & Labor Relations Review, Vol.
59, Issue 2, 2006, Berkeley Press, p14 Back
35
http://www.tescocorporate.com/plc/corporate_responsibility/good_jobs/human_rights/ Back
36
http://www.ufcw.org/twofaces/index.cfm Back
37
"Tesco job ads follow non-union line" Financial Times
26.5.06 Back
38
"Tesco faces US union challenge", Financial Times,
18 September 2008, http://www.ft.com/cms/s/0/7bc7d2a4-85ae-11dd-a1ac-0000779fd18c.html?nclick_check=1 Back
39
"… the most significant reason to implement [non-union
employee representation] arrangements was the desire by employers
to avoid active trade union presence in their workplaces-six of
the nine companies in the study suggested that this was the main
reason for their establishment", Gollan, Paul J., "Faces
of non-union representation in the UK: management strategies,
processes and practice", LSE Reseach Online, 2008. Back
40
Clause 8 of Tesco Fresh and Easy's Notice to Interested Parties
regarding the Fresh and Easy 401 (k) pension plan states:
"The employees eligible to participate under this plan are
all employees who have completed 90 days of service except
union employees, leased employees, non-resident aliens with no
US income, and Ex-patriot Employees". Back
41
In the case Dallas Morning News, 285 NLRB 807,808 (1987),
it was held that "clauses in benefit plans that automatically
exclude employees in a collective-bargaining unit violate the
[National Labor Relations] Act where they suggest that employees
will necessarily lose existing benefits if they join a union and
that coverage under such plans could not be gained through collective
bargaining." Back
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