Any of our business? Human Rights and the UK private sector - Human Rights Joint Committee Contents


Examination of Witnesses (Questions 220 - 239)

TUESDAY 30 JUNE 2009

SIR BRIAN FALL, PAUL LISTER, LUCY NEVILLE-ROLFE CMG AND STEVE WESTWELL

  Q220  Earl of Onslow: You would say "This is the cloth, we want you to stitch it into a shirt and we will buy it from Mr So-and-So in Knightsbridge".

  Mr Lister: Yes. Your shirt, for instance, we would buy the cloth in X, we would give the cloth to the supplier whom we had contracted to make the shirt and the same with the buttons and all the rest of it. So we are doing the contracting to make sure the standard of the cloth is up to our standards as opposed to getting the supplier to source that. In the case where the supplier does do it, we look very carefully at what the supplier is doing and how it is doing because, again, it goes to the very fabric of the garment.

  Ms Neville-Rolfe: May I just add that I agree with a lot of those things? You ought to check before you start the business and we have a code of practice which we give to new suppliers so they know what our expectations are. We have the buyer training, we have the audits, we have the supplier training and then we have the independent element. We have 726 independent auditors as well as our own technical people in our supply chain and then we try to change the culture of the supply chain, which helps you with the buttons and the cotton. We try to work with the suppliers so they understand that ethical is important, so that they in turn are going to trade ethically. The NGOs can also play a part. In Costa Rica we worked with Banana Link and the unions to try to make sure they understood about ethics. In South Africa we have a special group to help us with both the women who work on fruit farms and the issues of ethical trading there. It is not just the audit, it has to be a joined-up process and in a sense you are going to get problems because you will have a weak link somewhere with so many transactions. Then you have to put it right and I agree very much with Paul that the improvement plan is the important thing.

  Q221  Chairman: Can we go back to something Paul said earlier on in response to a question from me? You said that somebody—I think it was the reporter—had been coached to lie to the auditors. Presumably if the reporter had been, then other people in the factory had been as well; that would probably follow. So how can you be sure that the information you are getting is accurate? How can you rely on it?

  Mr Lister: If for a minute you just ignore the Manchester example, the idea behind the audit and what we instruct the auditor to do is to take out a sample of the employees, take them outside the factory and talk to them independently outside of management hearing, outside of management influence. In that way you try to understand what is really going on within the factory. There is a decent sample of employees within any factory who are spoken to and you would expect at some stage that you would begin to see whether there had been coaching. To go back to your specific example of coaching in Manchester, the programme came very quickly after the audit so that gap was too close to understand whether there was coaching going on or not. It was just the timing.

  Q222  Chairman: The sequence was the audit before the TV programme, was it not?

  Mr Lister: Yes.

  Q223  Chairman: Did the audit give them a clean bill of health?

  Mr Lister: No, it did not. The first audit in April did not give them a clean bill of health and there were issues to work on. The second audit in December did not give them a clean bill of health; again there were issues to work on. It is fair to say that the audit did not pick up all of the issues that the programme picked up and have subsequently been picked up with everybody looking at this Manchester factory. Would it have picked them up over time? I think it may have taken two or three more audits of that factory, which is extremely frustrating, but you keep going back going for continuous improvement within the factory to ensure that actually the issues you are auditing against are ultimately met and they then get a clean bill of health.

  Q224  Lord Dubs: My question is about Tesco. A few weeks ago we had a session with trade unions where we focused on the importance of right to freedom of association for the purposes of securing human rights. In your Corporate Social Responsibility Report for 2009 you say that "Employees across our business are free to join unions, and we have an industry leading partnership agreement with Solidarity in Poland and Usdaw in the UK". What do you think are the benefits of having a unionised workforce?

  Ms Neville-Rolfe: If we talk about the UK example, we have had a business for nearly 80 years in the UK and we have been unionised for about half of that. We work with the unions in the stores, when we put our induction packs out they recruit and they work with us on training, they work with us on health and safety, have consultation machinery which they are involved with and they wanted Tesco to grow, helped us with that whole growth piece over a long period. Similarly in some of the other countries in which we operate: You highlighted the Solidarity arrangement in Poland, which obviously is much less longstanding as our international business is 15 years' old.

  Q225  Lord Dubs: That being the case, I wonder whether you can comment on the following. You have set up a chain of stores in California and Nevada, have you not?

  Ms Neville-Rolfe: Yes.

  Q226  Lord Dubs: Why is it that your approach to trade union membership there is not as enlightened—if I may put it that way—as you have just described it is in the UK and indeed in Poland?

  Ms Neville-Rolfe: I would emphasise that staff are free to join a trade union and to freedom of association. What we found in the Fresh n' Easy business is that staff do not want to join a trade union; trade-unionism is not quite the same in the States. Some of our competitors, Trader Joe's, Whole Foods, Walmart, are not unionised as it happens. We have a very good pay and benefit package. It is a convenience business, so they are small stores not big box stores in the United States. There is a very supportive culture. We have our best figures on staff motivation and satisfaction in that business of all our businesses; 90 per cent figures. They have not wanted to become union members. Obviously there have been some steps by groups which I know have given evidence to you who are looking for support to extend trade unionism in that context, but it is early. We have been there a couple of years and the staff do not want to join the trade unions. They like the consultation mechanisms we set up within the business.

  Q227  Lord Dubs: Our difficulty of course is that we hear one side from you and we hear another side from them and we did meet the United Food and Commercial Workers Union in the United States. I do not think they would agree with you. They even said that some of the people who worked for you were frightened to talk to us. We are getting two different views. I just wonder how we can arrive at what your company's policy really is.

  Ms Neville-Rolfe: Our policy is to support free association. The trade unions in the United States have not come along in a collaborative and constructive way in quite the way I described for Usdaw. They have followed our staff home to try to get them to join the union in circumstances where they do not want to join. It is a different circumstance out there to be honest.

  Q228  Lord Dubs: In that case, would you be willing to look into this just to see. It is very difficult for us to get totally diametrically opposed views. I am not saying we have any evidence to support one way or the other. We have heard what you have to say and we heard what they had to say. Would you be prepared to look into that for us?

  Ms Neville-Rolfe: I am grateful to you for listening and certainly we will give you a further note.

  Q229  Chairman: May I pursue this a little further because we did not just meet the union, we met some of your employees there? You have described the union following people home; well that may or may not be the case. However, is it not a fact that the union is not allowed to do anything at all inside your shops, they are not allowed to talk about the union, if they are they will be subject to disciplinary action? There is no question of any form of recruitment anywhere in the shops at all. People have been subjected to what I can only describe as union-busting activities where assistant managers are bussed into a shop with only one or two employees in it. We heard stories of four or five assistant managers being bussed in to this particular shop to keep an eye on what was going on. Generally a very intimidatory atmosphere. We also heard complaints of your staff attempting to use the open-door policy to come in and make a particular complaint about their pay being underweight for the particular period concerned and it not being resolved. They go to the union and the union tries to resolve it for them. The fact is that I understand Mr Obama actually wrote to Sir Terry Leahy asking whether he would actually meet the United Food and Commercial Workers Union to discuss these issues yet there has been no reply, there has been no effort by the management to meet the union at all. That is completely contrary to what Tesco's union representation is in the UK. Why are you adopting this much more aggressive anti-union approach in the US compared to the UK, particularly bearing in mind that some 70 per cent of retail workers in California, Arizona, Nevada are unionised?

  Ms Neville-Rolfe: A series of these points has been raised with us and obviously I will look at the transcript and at the points you have raised to check those are the ones we have previously checked. When we have looked into them, they have not been true. Sir Terry did reply to President Obama and obviously I can ask him whether he would be happy to share the reply to that letter with you and explain the circumstances that we find ourselves in and the way that our staff have reacted. Individuals are entirely entitled to join unions; that is part of the protocols we have been discussing here today and I want to emphasise that.

  Q230  Chairman: They certainly did not give that impression to us. That may be your formal policy, but it is quite clear they were being frightened off as the only way to describe it. I met personally and spoke to two young women who were working for you. I have no reason to doubt their truthfulness. They tell their stories very clearly, very cogently, answered our questions. I have no reason to believe they were making it up. I think they were being entirely truthful. You can argue about what the union officials may or may not have said and put their gloss on it, but these were two ordinary shopfloor workers, the sort of people you see in the supermarkets in the UK, who wanted to join the union to be represented, to make sure they get a fair crack of the whip and they were being subjected to what I can only describe as union-busting practices.

  Ms Neville-Rolfe: I can assure you that they are entitled to join the union. I can say that clearly. Also, when individual things have been stated and the union concerned has actually put out some material in the UK as well, they have a lobbying company here, some of the material in that is not accurate. They say it is only 60 hours paid part time off, for both sickness and holiday and it is actually 160 hours or more which is actually very competitive.

  Q231  Chairman: Was the union allowed to recruit in your stores?

  Ms Neville-Rolfe: They are outside our stores some of the time.

  Q232  Chairman: Are they allowed to recruit in your stores like they would be in the UK?

  Ms Neville-Rolfe: The staff are allowed to join a union and it is entirely up to them.

  Q233  Chairman: Can one member say to another member of staff "I'm a member of a trade union. Here's a membership card" inside your stores like they could in the UK?

  Ms Neville-Rolfe: I do not think the card system works in quite the same way in the US.

  Q234  Earl of Onslow: With the greatest respect, you were asked a very, very, very simple question. Are they allowed to recruit inside your stores or not? I have noticed that you have been dodging. You may think it slightly odd for an hereditary peer on the right of the Conservative Party to suddenly be taking a pro-trade unions attitude but this is because I would quite like an answer.

  Ms Neville-Rolfe: Individuals are allowed to join the union.

  Earl of Onslow: That was not the question.

  Q235  Chairman: You made a criticism earlier on about unions following people home to recruit. It is probably not surprising that the union tries to follow people home to recruit new staff, if that is what they are doing, if they are not allowed to recruit on the shopfloor like they can in the UK. Are they or are they not allowed to recruit inside the shops in the US or not? A simple question.

  Ms Neville-Rolfe: I would prefer to come back to you on that detailed issue to make absolutely sure I am not misleading the Committee in any way. What I can state absolutely clearly and we have said again and again is that there is a right of association but that the approach the unions have taken has been different in the United States to the one we have been used to in other places, including the UK. They seem to be trying to use discussions outside the US to push forward the trade-unionism in the US.

  Q236  Chairman: It is perhaps not surprising, if your management in the US will not meet with the union, that they come and raise issues with us and other people in the UK to raise with you if you will not talk to them. Here you are talking to us about it. Will your company meet the union, will the American management meet the American union, to discuss these issues with them?

  Ms Neville-Rolfe: We are very happy to meet our staff.

  Q237  Chairman: Will you meet the union?

  Ms Neville-Rolfe: I think my colleagues in Fresh n' Easy have not had a collective meeting with the union. There has not been evidence of individual staff—

  Q238  Chairman: That is a given. We know they have not met the union because you have said so and they told us so. That is agreed. The question I am asking you now is whether you will—not you personally, your management in the United States—meet the union to discuss your mutual concerns about each other and try to reach an accommodation which is to everybody's benefit, in particular your staff's benefit?

  Ms Neville-Rolfe: I think our staff have made quite clear what they think is to their benefit. I am in touch regularly with the management in the United States. I will talk to them about the exchanges we have had. I can assure you that we are trying to do our best for our staff there but they so far have not chosen to join the union.

  Q239  Chairman: The ones we met had and they were not being given an easy time as a result.

  Ms Neville-Rolfe: Obviously if you can give me any details in relation to them in an appropriately confidential manner—


 
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