Sixth Survey on
the Effect Given to the Tripartite Declaration of Principles
concerning Multinational Enterprises and Social Policy
The Declaration sets out principles in the fields of employment, training, conditions of work and life and industrial relations which governments, employers' and workers' organizations and multinational enterprises are recommended to observe on a voluntary basis; its provisions shall not limit or otherwise affect obligations arising out of ratification of any ILO Convention.
(1) Have any of the activities of MNEs given rise to conflicts with national policy objectives and with the interest of the workers? If so, please explain.
(2) In an endeavour to further the aims of the Declaration, have any new laws been promulgated, policy changes made or action taken since the last survey to which you replied?
(3) Have any difficulties arisen for any of the addressees of the Tripartite Declaration in their attempts to respect its principles? If so explain.
Antigua and Barbuda, Argentina, Australia, Austria, Bahamas, Bangladesh, Barbados, Belgium, Brazil, Cambodia, Canada, Chad, Chile, China, Colombia, Costa Rica, Czech Republic, Dominica, Ecuador, Egypt, Estonia, Finland, France, Gabon, Germany, Grenada, Hungary, India, Ireland, Italy, Japan, Jordan, Republic of Korea, Kuwait, Luxembourg, Malaysia, Mauritania, Mauritius, Mexico, Namibia, Netherlands, New Zealand, Nicaragua, Nigeria, Norway, Pakistan, Poland, Portugal, Romania, St. Vincent, Singapore, Slovakia, Slovenia, Spain, Sri Lanka, Swaziland, Syrian Arab Republic, Sweden, Switzerland, Thailand, Trinidad and Tobago, Tunisia, Turkey, United Kingdom, United States, Uruguay, Venezuela, Zambia, Zimbabwe.
The Government of Antigua and Barbuda notes that efforts are made to balance the activities of MNEs with national development priorities. The Labour Code, which is based on international labour standards, applies to all enterprises and it has served to minimize conflicts between the activities of MNEs, national policy objectives and workers' interests. The Labour Code and Workmen's Compensation Act are being amended in order to improve conditions of work and life, labour relations and tripartism. The principles of the Tripartite Declaration are valuable and the addressees are making efforts to respect them. The Antigua Employers' Federation states that all enterprises are governed by the same legislation, i.e. the Companies Act, Business Licence Act, and the Labour Code.
The Government of Argentina states that the information contained in its reply to the fifth survey is still applicable.
According to the Government of Australia, there are no indications that MNEs' activities in New South Wales and South Australia have given rise to conflicts either with national or state policy objectives and workers' interests. Several laws of relevance to the Tripartite Declaration were either passed or in force during the period covered by the Survey. In New South Wales, the Industrial Relations (Sick Leave) Amendment Act 1992, Anti-Discrimination (Age Discrimination) Amendment Act 1993 and the Anti-Discrimination (Homosexual Vilification) Amendment Act 1993, were passed. In Queensland, the Anti-Discrimination Act 1991 which makes specific reference to a number of international instruments such as ILO Convention No. 111 came into force on 30 June 1992. In South Australia, the Industrial and Employee Relations Act 1994, the Occupational Health, Safety and Welfare Act 1986 and the Workers' Rehabilitation and Compensation Act 1986, are in force. All the laws mentioned as well as decisions and policies in the fields of training, industrial relations, OSH and workers' compensation, apply to domestic enterprises and MNEs.
The Government of Austria reports that by virtue of the country's membership in the EU it has a legal obligation to incorporate into national law by the end of 1996, the provisions of Council Directive 94/45/EC concerning the establishment of a European Works Council. At the end of 1993, the major foreign investors were from Germany, Switzerland-Liechtenstein (jointly), the US and France. Of the 2,816 firms with majority foreign ownership operating in Austria in 1993, 1,484 were in the services sector, mainly in commerce (968 enterprises) and 720 were in manufacturing. Most of those in manufacturing were in the metal trades (233 firms), 107 were in the petroleum and chemical industries, and 68 in the textiles, garment and leather industries. At the end of 1993, there were 850 overseas-based Austrian MNEs (i.e. more than 50 per cent Austrian capital) operating in the services sector. Of those service enterprises, 47 per cent were in commerce and 12 per cent in banking and finance. Thirty-seven per cent of the 645 Austrian manufacturing MNEs abroad were in the metal trades and 11 per cent were in petroleum and chemicals. As regards employment, in 1993, Austrian MNEs employed approximately 89,900 persons abroad. Of these, 34,100 were in Hungary, 18,600 in Germany and 13,400 in the Czech Republic. In Austria, foreign MNEs (i.e. more than 50 per cent foreign capital) created direct employment for some 212,000 persons. Almost half of those workers were in German MNEs. (Data extracted and percentages calculated from report of the Austrian National Bank annexed to reply.)
The Government of the Bahamas reports that to date none of the activities of MNEs have given rise to conflicts with national policy objectives and workers' interests. Policies and procedures relating to investment have been amended in order to attract MNEs. So far there have been no difficulties for any of the addressees in their attempts to respect the Tripartite Declaration.
The Government of Bangladesh reports that the activities of MNEs have not given rise to any conflicts with national policy objectives, nor with the interests of the workers. No new law has been promulgated since the last survey. However, there have been some minor amendments to certain laws (unspecified). There have been no difficulties with regard to implementation of the principles of the Tripartite Declaration. The Bangladesh Employers' Association agrees with the Government, and it adds that in 1992 a Tripartite National Law Commission was set up to update existing labour legislation. Its recommendations have been submitted to the Government for consideration.
The Government of Barbados replies that there has been no known conflict with national policy objectives arising out of the activities of MNEs. During the period under review, the National Productivity Board Act 1993-14 was passed. None of the addressees of the Tripartite Declaration reported difficulties in their attempts to respect its principles. The Barbados Employers' Confederation replies in the negative to all three questions. The Barbados Workers' Union replies in the negative to all three questions.
The Government of Belgium reports that no distinction is made between multinational and national enterprises with respect to social policy. Both social and economic policies are subject to broad consultation between the social actors. Within the framework of interprofessional agreements which are concluded every two years, the social partners submit proposals to the Government relating to legislative and regulatory reforms. There are doubts about the extent to which MNEs operating in Belgium share the country's social concerns. The Government notes that Council Directive 94/45/EC of 22 September 1994 concerning the establishment of a European Works Council is for the purpose of informing and consulting with the workers. Problems of implementing national legislation are increasing, particularly as regards employment (specifically in cases of disinvestment) and conditions of work. The National Labour Council (NLC), which comprises the most representative employers' and workers' organizations, points out that even though increasing economic globalization and pressures to be competitive have taken their toll on employment, MNEs have generally had a positive impact on investment and employment in the Belgian economy. In its last reports, the Council had noted that there were no particular problems as regards conditions of work and industrial relations in MNEs. Regulations in these domains apply to all enterprises, whether Belgian or multinational and regardless of their location. The NLC identifies the major national laws, collective agreements and various Council Directives (of the EU) that comprise the framework for dealing with various labour-related issues. Since the last survey, several laws of relevance to MNEs have been adopted, pertaining mainly to the provision of information to workers, health and safety at work and equality of treatment. The laws adopted between 1992 and 1995 are: Royal Order of 7 April 1995 concerning the provision of information to works councils on employment-related matters; the Act of 13 April 1995 which requires that foreign-owned enterprises make various documents and information publicly available before starting their operations; Royal Order of 27 April 1995 amending section 12(2) of the Act of 17 July 1975 concerning accounting, and annual accounts of enterprises as well as certain orders for implementing this Act; Royal Order of 14 September 1992 relating to the implementation of the Council Directive of 12 June 1989 concerning the improvement of occupational safety and health; and Royal Order of 8 February 1993 amending the General Regulation concerning the provision of information to the Committee on Safety and Health and Improvement of the Work Environment. While on the whole MNEs respect the national labour legislation, problems have arisen with regard to informing workers about economic, social and financial issues in cases of closure or restructuring of enterprises. Certain MNEs have also had difficulties in adapting to local practices as regards social dialogue and consultations. However, these problems are by no means peculiar to multinationals. The possibility of incorporating European Directives into Belgian law as well as having them reflected in collective agreements are particular features worth noting. The NLC notes that during the period under review, Council Directives relating to working time (23 November 1993), the protection of young workers (22 June 1994) and the establishment of works councils (22 September 1994) were adopted.
The Government of Brazil states that the activities of MNEs have not given rise to conflicts with national policy objectives and workers' interests. During the period under review no new measures were adopted for furthering the aims of the Tripartite Declaration and there were no difficulties as regards the application of this instrument. The Single Central Organization of Workers (Central Única dos Trabalhadores) reports that in Brazil, MNEs' activities have "constantly harmed workers' interests" and the rights of workers are being eroded. Dismissals have been on the increase in recent years and the principles of Convention No. 158 are not applied. No laws furthering the aims of the Tripartite Declaration have been passed.
The Government of Cambodia states that MNEs' activities have not given rise to conflicts with national policy objectives nor with workers' interests. There have been no policy changes during the period covered by the survey. Due to 23 years of war, this is the first survey to which Cambodia is replying. New legislation, i.e. the Investment Code, was enacted in August 1994. No difficulties have arisen with respect to observing the Declaration.
The Government of Canada reports that MNEs play an important role in the national economy. According to the most recent data available (1993), foreign-owned enterprises accounted for 20.9 per cent of the country's total assets. The 1986 Competition Act, which is in force, lays down thebasic principles for the conduct of business. With the increasing internationalization of the economy, several initiatives were made between 1992 and 1995 to enhance cross-border enforcement of this legislation. These include the signing of the North American Free Trade Agreement which contains non-binding provisions relating to competition laws and cooperation for their enforcement, and the 1995 Canada-United States Competition Policy Agreement. NAFTA, which came into force in January 1994, is the only international agreement to link the enforcement of labour standards to trade. Under the Agreement on Labour Cooperation (NAALC), Canada, the US and Mexico undertake to improve working conditions and living standards and to protect and improve workers' rights. The Government lists the areas in which labour principles are to be promoted and respected: freedom of association and the right to organize; the right to bargain collectively; the right to strike; prohibition of forced labour; labour protection for children and young persons; minimum employment standards; elimination of discrimination in employment; equal pay for women and men; prevention of occupational injuries and illnesses; compensation in cases of occupational injuries and illnesses; and protection of migrant workers. It describes the programme through which the parties would work towards attaining these goals and the procedures for dealing with disputes that may arise. Canada is negotiating a bilateral accord on labour cooperation with Chile, as part of an interim bilateral trade agreement. As a member of the OECD, Canada adheres to the various OECD codes, declarations and decisions which have a bearing on international investment and the activities of MNEs. Bilateral investment agreements have either been concluded or are being negotiated with a number of CEECs and developing countries. The Government of the Province of Quebec notes that on average the incidence of labour-related problems in MNEs does not exceed that in other large enterprises. It draws attention to two disputes involving MNEs that arose during the period under review. The first concerned the acquisition by a foreign multinational (country of origin indicated) of non-unionized stores belonging to a big chain, and the subsequent closure of those stores which had unionized workers. The second concerned a strike in a flour-mill which lasted more than one year and during which strikebreakers were brought in. On the whole, however, MNEs tend to have more joint consultation arrangements than other companies -- 39 as opposed to 35.6 per cent. One quarter of all MNEs have joint job evaluation committees whereas only 8.8 per cent of other enterprises do. Nine per cent of MNEs have joint committees that look into social benefit schemes and 2 per cent of them have committees that deal with matters concerning staff movements. The situation is about the same in local companies. The 1990 Labour Standards Act which came into effect in January 1991 introduces changes with regard to the following: the right to three weeks' annual leave for those with five years' continuous service; the right of workers with at least three years' continuous service to submit complaints of unfair dismissal; the right to 18 weeks of maternity leave and 34 weeks' parental leave with guaranteed reinstatement; and the principle of equal pay for part-time and full-time workers in the same enterprise. Fifty-nine per cent of collective agreements in MNEs contain provisions concerning maternity leave and 29 per cent have provisions relating to parental leave. However, only 2 per cent of collective agreements in MNEs apply fully to part-time workers as opposed to 13.2 per cent of agreements in other enterprises. The Act to amend the Labour Code of Quebec (11 May 1994), is intended to facilitate the conclusion of collective agreements of more than three years' duration. MNEs are the main proponents of these types of contracts. The Act for the Development of Manpower Training (22 June 1995) provides for employers to devote 1 per cent of their wage bill to training. Those with a wage bill exceeding Can$1 million have to apply the law with effect from 1996. Other laws of relevance to MNEs are the Act to amend the Act on Complementary Retirement Systems (17 June 1994), the Act to amend the Tax Act (15 June 1993) and the Act to amend the Act concerning the Ministry of Cultural Communities and Immigration (no date given).
The Government of Chad states that MNEs' activities do not conflict with workers' interests. No new laws and regulations have been adopted since the last survey with a view to furthering the aims of the Tripartite Declaration.
The Government of Chile states that during the period under review a number of changes relating to labour relations and FDI were introduced. Among them were the passing of Act No. 19.404 of 21.8.95 concerning old-age pensions and the carrying out of heavy physical work, and Legislative Decree No. 600 (no date given) which eliminates restrictions on the repatriation of capital. The following were also prepared for consideration: the Bill to reform the Training and Employment Statute; the Bill to broaden the authority of the Labour Administration and the Bill to strengthen the right to organize and bargain collectively. The Government's policies and programmes are destined to keep unemployment rates low and to enhance the quality of jobs. The labour policies are in harmony with the Tripartite Declaration and the operations of MNEs have in no way conflicted with national policy and workers' interests. MNEs and national enterprises are treated in the same way and they all are subject to, and must respect, the national legislation. The Labour Administration authorities have implemented policies and programmes for the following: to prevent the violation of labour standards; to reorganize procedures for the registration and functioning of trade unions; to optimize the procedures and activities of the department that deals with collective bargaining; to evaluate the application of labour standards; to assess activities under the Workers' Training and Education Fund; and to systematize legislation and jurisprudence in the labour field. The goals are: to consolidate the decentralization process; to involve employers' and workers' organizations in official inspection methods with a view to improving the observance of labour laws, and to strengthen the capabilities of the Labour Administration. In 1995 a unit was set up to collect, process and analyse information relating to the evolution of labour relations systems in the country. Complementary activities are being carried out by those departments within the Ministry of Labour and Social Security, which deal with labour inspection, collective bargaining and workers' organizations.
The Government of China reports that at the end of June 1994, foreign investment in China amounted to US$76.6 billion, and that the number of foreign- funded enterprises exceeded 100,000. The number of employees in such enterprises stood at 140 million. In view of the "wide range of issues covered" by the questionnaire for the Survey and the amount of work that preparation of a meaningful response would entail, the Government is unable, due to "some constraints", to "provide an item-by-item reply". However, it provides copies of the "Provisions on Labour Administration of Enterprises with Foreign Investment" which were drawn up by the Ministry of Labour and the Ministry of Foreign Trade and Economic Cooperation, and promulgated on 11 August 1994. It notes that the "meaningful information" contained in this document may be "regarded as a partial reply". The "Provisions" cover the following: recruitment (articles 5 and 6); vocational training (article 7); the negotiation, content, modification and termination of labour contracts (articles 8-13); wages (articles 16 and 29); social insurance and benefits (articles 17-23); leave entitlements (article 24); dispute settlement (articles 25-26) and sanctions to be imposed when the "Provisions" are violated (articles 27-34).
The Government of Colombia reports that MNEs respect the national laws relating to human rights, labour matters and environmental protection. As regards pay, there must be no distinction between nationals and foreigners doing the same type of job. National treatment is accorded to foreign-owned enterprises which must also respect the legislation in force, concerning employment and related matters in both the private and public sectors. When necessary the State uses the mechanisms at its disposal to have the activities of MNEs brought into line with the relevant legislation. Opportunities for FDI and the establishment of MNEs are increasing because of liberalization, industrial restructuring and the internationalization of the economy. MNEs create jobs for both skilled and unskilled workers. During the period covered by the Survey regulations relating to Act 100 (1993) were issued. They emphasize the relationship between economic and social well-being, improved living standards and the importance of satisfying basic needs, including in the areas of health and pensions. Government, employers and workers concluded a social pact and efforts to control inflation are under way. A key objective is to create productive employment using adequate technologies and a social policy that addresses the question of productivity while paying special attention to vulnerable groups of workers. No problems have arisen with regard to the observance of the Tripartite Declaration and MNEs respect the national labour standards which are enforced by the Government. The National Association of Manufacturers reports that the activities of MNEs neither conflict with national policy objectives nor with the interests of workers. Working conditions in MNEs in Colombia are generally better than those in national enterprises and this contributes to an improvement in living standards. The General Confederation of Democratic Workers states that no new laws for furthering the aims of the Tripartite Declaration were enacted during the period under review. There is very little control over MNEs. However, the problems that have arisen concern not only these enterprises but also others operating in the country. The national laws in force in Colombia apply to all enterprises. None the less, they are not always respected and many enterprises pay wages which are less than the statutory minimum and they use different means to prevent the formation of unions and collective bargaining.
The Government of Costa Rica replies in the negative to all three questions.
The Government of the Czech Republic gives an overview of economic and social developments which marked the transition from a centrally planned, to a market-oriented economy. A number of macroeconomic and social reforms were instituted. Their aim is to create a favourable climate for foreign investment, develop the services sector, establish a network of employment services to facilitate the functioning of the labour market, and support the development of employers' and workers' organizations and collective bargaining. The creation of an efficient social security system is also one of the aims of social reform. There has been significant inward investment (examples of some 21 major foreign MNEs named) in all sectors of the economy. Several of the 21 largest accounting firms serving local enterprises and MNEs in Prague (ranked by total number of employees) were established during the period under review (data in material annexed to report). Since the reform measures were instituted in close collaboration with the social partners, there is stability in the social, political and macroeconomic spheres. Inflation is low and unemployment was around 3 per cent in 1995. MNEs' activities have not given rise to conflicts with national policy objectives and workers' interests. They have brought substantial benefits -- i.e., new production technologies, training of employees, higher OSH standards, better working conditions, innovative and improved management practices, and new forms of social dialogue. The Labour Code was amended and new legislation was adopted in the areas of employment and social security. The national labour legislation and related regulations, as well as the Tripartite Declaration, are applicable to all enterprises in the Czech Republic. MNEs' activities have been in conformity with the law, and the Government is not aware of any difficulties as regards the application of the national laws or the principles of the Declaration. The Regional Labour Offices which are responsible for labour inspection, have been given copies of the Tripartite Declaration. They implement its principles in their daily activities and monitor its application by MNEs. The Czech and Moravian Chamber of Trade Unions (MK OS) states that it is not possible to determine whether MNEs' activities conflict with national policy objectives, since trade unions are not privy to contracts between the Government and MNEs. A number of problems may arise because of the transitionary state of the economy and the speed with which market reforms are being implemented. Long-term policy objectives and workers' interests seem not to be major factors in determining the contractual obligations of MNEs. Certain problems may have arisen because of the abolition of traditional trade unions, profound changes in traditional Czech industries such as glass-making, uncontrolled mining and the impact of industrial activities on the natural environment. The Labour Law has been amended and a number of new laws enacted. However, these have been to the disadvantage of workers. The minimum wage is way below that which is necessary for maintaining minimum living standards. Government has shown a general reluctance to extend "higher level" collective agreements to certain enterprises and some employers' organizations have been unwilling to conclude such agreements. Tripartism has been weakened due to the Government's reluctance to negotiate and the union's defensive stance on this. According to MK OS, the principles of the Tripartite Declaration have not been sufficiently utilized to guide relations among the social partners.
The Dominica Employers' Federation reports that workers and their organizations complain that foreign enterprises, including MNEs, "fly out of the country by night" when fiscal exemptions and economic incentives expire, leaving workers jobless and debts to banks, state institutions, utility companies and workers. No changes were made with specific reference to the Tripartite Declaration and there are no known difficulties as regards the observance of this instrument.
The Government of Ecuador takes note of the observations made in paragraph 1 of the Tripartite Declaration as regards the effects of the activities of MNEs, and it affirms that it values the aims of this instrument.
The Government of Egypt reports that during the period under review, no new laws or policies were adopted to enhance the objectives of the Declaration. Since 1991, a programme of reforms for building a market economy has been under way and the 1991 Public Enterprises Law No. 203 provides for the privatization of state enterprises. Information by the Federation of Egyptian Industries shows that MNEs' activities (examples of enterprises from the pharmaceutical and metal trades cited by name) have not given rise to conflicts with national policy objectives and workers' interests.
The Government of Estonia states that the national Constitution, the Law on Foreign Investments, the Business Law and legislation regulating labour relations, apply to both national and multinational enterprises. The Government has no information about MNEs deliberately obstructing the exercise of workers' rights. The Estonian Confederation of Industry and Employers mentions that while there have been misunderstandings during the negotiation of collective agreements in certain MNEs, collective bargaining and labour relations pose no problems in others (examples of two companies (named) given to illustrate this point). According to information from the Association of Estonian Trade Unions, the activities of MNEs do not conflict with national policy objectives and the interests of workers. MNEs exert some influence on political developments. Since they often pay higher wages and offer better conditions of work, workers prefer to be employed by multinationals. However, problems in relation to the protection of workers' rights have arisen in some MNEs and there have been cases of managers directly obstructing collective bargaining. More often, they indirectly restrict workers' freedom to form and/or join trade unions. Sometimes the standards of industrial relations in MNEs are lower than those observed in the home country. Representatives of MNEs usually attribute this to insufficient knowledge of the Estonian language. Estonian entrepreneurs are not familiar with the Tripartite Declaration.
The Government of Finland replies that the activities of MNEs have not given rise to conflicts with national policy objectives and workers' interest. In general, there are no particular measures regarding multinationals in Finnish legislation or administrative practice. Consequently MNEs have no special rights or obligations. The achievement of national economic objectives requires close cooperation between the Government and the social partners, which will include MNEs since they are often members of local employers' organizations. During the period under review an Act concerning the taxation of employees and another, to enhance equality between men and women, came into force. One of the goals of Finland's industrial policy is to attract inward FDI and, to this end, legislation liberalizing former restrictions on foreign ownership (i.e. company acquisitions) was enacted on 1 January 1993. According to an OECD report (copy attached to reply), FDI inflows increased from US$406 million in 1992 to US$865 million in 1993 and US$1,467 million in 1994. FDI outflows rose from US$ -752 million in 1992 to US$1,677 million in 1993 and US$3,771 million in 1994. Inward FDI stock amounted to US$6,635 million in 1994, while outward stock was US$14,674 million in that same year. A report by the Bank of Finland (copy attached to reply) shows that in 1994 more than half of foreign investment in Finland was in manufacturing, with metal and engineering industries accounting for the largest share. Inward FDI comes mainly from Sweden, Switzerland, the Netherlands, Denmark and the US. Employment in Finnish manufacturing MNEs abroad rose from 133,330 in 1992 to approximately 138,300 in 1994. No difficulties have arisen for any of the addressees of the Tripartite Declaration in their attempts to respect its principles. The Confederation of Finnish Industry and Employers and the Employers' Confederation of Service Industries state that MNEs in Finland, like other comparable employers, respect collective agreements and national labour standards. They are normally members of the Finnish employers' organizations. During the reporting period there were no new developments of relevance to the Tripartite Declaration. Foreign investment in Finland has been further liberalized from the beginning of 1993 when new legislation concerning foreign acquisitions of enterprises came into force. Foreign ownership is now entirely free, except for cases where essential national interests may be at stake. The Industry Department of the Ministry of Trade and Industry decides on a case-by-case basis whether this internationally defined criterion is met, after which the Government takes the final decision on whether or not to allow a foreign acquisition. The Central Organisation of Finnish Trade Unions (SAK), the Finnish Confederation of Salaried Employees (STTK) and the Confederation of Unions for Academic Professionals in Finland (AKAVA) indicate that there have been no significant incidents of conflict between the activities of MNEs and national policy objectives and the interests of workers. As a rule, foreign enterprises have to observe the standards set by collective bargaining, the industrial relations system and labour legislation. Legislation passed in January 1993 removes restrictions on foreign ownership. Consequently there are less possibilities for government authorities to monitor FDI. The significant legislative reforms are related to developments in the EU and the European Economic Area (EEA). By virtue of its membership in the EU, Finland is bound by the Council Directive on the establishment of a European Works Council. Another important Council Directive is the one concerning the Transfer of Undertakings, which has applied to Finland since 1994. It has improved the rights of workers in cases of the transfer of enterprise activities. However, some recent, purely domestic incidents show that implementation of the Directive could be somewhat improved. The addressees of the Tripartite Declaration have not reported any difficulties as regards its application. However, it is to be stressed that at the enterprise level, theDeclaration is not known. A survey among elected workers' representatives in foreign-owned enterprises, carried out by the Chemical Workers' Union for the purpose of completing this questionnaire, showed that the effects of foreign ownership are felt at the shop-floor level because of the greater need for management to report to headquarters and obtain approval for significant local decisions. Local management often lacks the authority to take decisions on matters raised by the employees.
The National Council of French Employers reports that the principles of the Tripartite Declaration are always respected by MNEs.
The Government of Gabon reports that the activities of MNEs do not conflict with national policy objectives or the interests of workers. During the period covered by the survey, the following laws were passed: the Ordinance of October 1993 (008/93/PR) creating the National Employment Office as well as Decree No. 273/93 concerning the application of the Ordinance, and the Act of 21 November 1994 (No. 3/94) which amends the Labour Code. Structural adjustment programmes together with the devaluation of the CFA franc have led to a significant decrease in investment. Consequently, many enterprises have either shut down operations or reduced their workforce. This has aggravated unemployment and lowered purchasing power considerably. The Gabonese Confederation of Free Trade Unions (CGSL) states that structural adjustment in Gabon has led MNEs to encourage locals to leave their jobs voluntarily in order to alleviate social security contributions. The CGSL notes that workers and their representatives faced difficulties with regard to the application of the principles contained in the Declaration prior to the enactment of the new Labour Code. However, the new Code contains provisions that are favourable to the exercise of freedom of association.
The Government of Germany points out that the information provided in its last report is still applicable. It adds that during the period under review it continued efforts to improve the regulatory framework governing the activities of MNEs and their effects on workers. Legislation is being drafted to incorporate into national law the provisions of Council Directive 94/45/EC on the establishment of a European Works Council. The Confederation of German Employers' Associations (BDA) is of the opinion that the survey is based on the assumption that MNEs enjoy a special status in host countries as regards social policy, which is not the case in Germany. MNEs are subject to the same labour and social legislation as local and other companies. Those which belong to the BDA's member organizations participate, like local enterprises, in labour-related matters (e.g. wage policy) and they are bound by sectoral collective wage agreements.
The Government of Grenada replies in the negative to all three questions.
The Government of Hungary reports that the activities of MNEs are generally not contrary to its national policy objectives or workers' interests. MNEs have made an important contribution to the achievement of economic objectives such as the privatization of SOEs and economic growth. One undesirable feature of the privatization process, however, has been staff lay-offs. None the less this is usually done in accordance with the regulations which seek to protect the interests of workers. Since the last survey, several new laws have been enacted to facilitate the transition to a market-oriented economy. New legislation, including the Labour Code enacted in 1992, and the New Labour Safety Code passed by Parliament in 1993, are in keeping with the Tripartite Declaration. No special difficulties have been experienced in applying the principles of this instrument during the period under review.
The Government of India replies in the negative to all three questions.
The Government of Ireland replies in the negative to all the questions.
The Government of Italy reports that MNEs' activities have not given rise to conflict with national policy objectives nor with workers' interests. None of the addresses of the Declaration have faced difficulties to implement its principles. It draws attention to Council Directive No. 94/45 on the establishment of a European Works Council, which was adopted during the period under review and must be complied with by 22 September 1996. It gives an overview of the provisions of the Directive, which applies to MNEs operating in the EU. The General Confederation of Industry (Italy) replies in the negative to all three questions.
The Government of Japan states that its reply to the fifth survey is still applicable. It adds that the trend of Japanese enterprises locating overseas continues and that various measures have been put into place to enable these MNEs to carry out their activities smoothly in the host countries. It refers to the Actions (ten items) Expected of Enterprises in Development of their Business Activities Overseas issued in 1989. These "proposals" urge Japanese MNEs to respect local trade unions and workers' representatives, and to observe good industrial relations practices. The Government has been trying to make these "proposals" well known. In 1992 they were partially revised to include a provision relating to safety and health. The Japan Institute of Labour (JIL) has issued a manual dealing with labour-related issues (by region) for use by Japanese MNEs abroad. Since 1990 the JIL has held seminars in host countries to Japanese MNEs, and in 1994 it commissioned research from workers' and employers' organizations, as well as research institutes in 15 countries where Japanese MNEs are based. Tripartite survey teams have also been sent to various countries to collect information on the labour situation. Seminars for Japanese managers in EU-based enterprises have been held. In 1993 a "Survey on Actual Situation of Vocational Life of Workers Despatched Overseas" was conducted to gain some insight into the ways in which Japanese workers adjusted to living and working in different host countries. Since 1994 there has been a "Society for Research on Personnel and Labour Management in Multinational Enterprises", designed to improve personnel management in MNEs in Japan. The Japan Federation of Employers' Associations (NIKKEIREN) supports the Government's view with regard to the globalization of Japanese MNEs. It notes that a group of major organizations representing the business community adopted the Guidelines for Overseas Direct Investment (Kaigai Tshi Kd Shishin) in order to address the social and labour dimensions of this overseas expansion. It is increasing its efforts to make these widely known to investors. The Guidelines (copy attached to report) cover, inter alia, the following: "Establishment of Sound and Fair Labor-Management Relations" (para. 4); "Employment and Promotion of Local Personnel" (para. 5); "Promotion of Education and Training for Local Employees" (para. 6); "Cooperation with Industries of the Host Country" (para. 10); and "Promotion of Technology Transfer" (para. 11). The Japanese Trade Union Confederation (JTUC-RENGO) points out that there have been cases in which Japanese enterprises experienced difficulties in respecting the principles of the Tripartite Declaration. It attributes this partly to the lack of will on the part of some managers to respect the Tripartite Declaration, and partly to the non-enforcement of national laws and regulations by authorities of the host countries. It notes that the ideal would be for host country governments and local management of enterprises to respect the principles of theTripartite Declaration. However, since this is not the case, the "second best solution" would be to involve parent companies, their trade unions and home country governments in the search for a solution to problems relating to the practices of overseas subsidiaries. The JTUC-RENGO is of the view that many governments and headquarters of MNEs in home countries are "very reluctant" to become involved in resolving labour-management problems of affiliates in other countries. It expresses the hope that an agreement can be reached or "a new document adopted by the ILO Governing Body" as a result of which governments, employers and trade unions in home countries would collaborate with their counterparts in stopping "any flagrant violation of laws and legal procedures by their subsidiaries in other countries, especially in the developing regions".
The Government of Jordan replies in the negative to the first two questions. It notes that, to date, there are only a small number of MNEs in the country and so far, their influence on social, economic and political matters has been relatively weak. The addressees of the Tripartite Declaration have had no difficulties in respecting its principles. The Amman Chamber of Industry (Jordan) replies in the negative to all the questions.
The Government of the Republic of Korea reports that no conflicts have arisen between the activities of MNEs and national policy objectives. During the period covered by the survey, certain laws were amended to encourage inward investment. Under the amended Enforcement Decree of the Foreign Capital Inducement Act, the Comprehensive Assistance Centre for Foreign Investment and nationwide investment review consultation committees have been set up. All administrative procedures relating to the establishment of enterprises, fiscal advantages for high-tech companies and the granting of commercial loans have been simplified. The head of the competent authority is responsible for approving and following up all investment-related matters. There have been no difficulties in implementing the principles of the Declaration. The Korea Employers' Federation reports that MNEs' activities do not conflict with national policy objectives. Regulatory reforms to improve conditions for foreign investment are under way. The Ministry of Labour has set up a special unit to oversee labour-management relations in MNEs. No difficulties have arisen for employers in their efforts to respect the principles of the Declaration.
The Government of Kuwait states that
MNEs' activities have not given rise to conflicts with national policy objectives or
workers' interests, as they are governed by the Constitution and national legislation such
as Labour Law No. 38/1964, all of which are applicable to the private sector. The
Government is generally favourable to the adoption of new laws in line with the spirit of
the Declaration. None of the addressees of the Declaration have faced difficulties in
applying its
principles.
The Federation of Luxembourg Manufacturers (FEDIL) states that the principles of the Declaration are embodied in the national legislation, and respected. FEDIL is not aware of difficulties that the addressees of the Declaration may have faced in implementing this instrument. The Confederation of Independent Trade Unions notes that in their search for profitability, MNEs in Luxembourg increasingly carry out social policies which infringe upon workers' rights. In recent years, weekend working has been introduced in the manufacturing and services sectors. By virtue of the internationalization of the economy and the complexity of the legal and commercial structures which characterize MNEs, the laws on information, consultation and codetermination are becoming increasingly inadequate in the case of these enterprises.
The Government of Malaysia reports that, in general, the formation of national unions, except in the textile and electronics industry, is encouraged. In the textile industry, there are state-based unions, while in the electronics industry establishment unions are encouraged. These unions can affiliate to National Labour Centres, such as the Malaysian Trade Union Council. The principles of the Declaration are complied with. According to the Malaysian Trades Union Congress, MNEs "constantly put pressure" on the Government to provide them with "non-union" guarantees for continued investment. In their view, an example of this occurred when the Government rescinded a 1988 agreement for the formation of a National Union for Workers in the Electronics Industry. No actions have been taken to further the aims of the Declaration and the Government has made no attempts to respect its principles.
The General Confederation of Employers of Mauritania (Confédération générale des Employeurs de Mauritanie) states that given the limited number of MNEs operating in the country, their activities have neither given rise to conflicts with national policy objectives nor with the interests of workers. No new laws were adopted during the period covered by the survey. The existing legal framework is favourable to the realization of the objectives of the Declaration. Neither the Government nor the social actors have faced difficulties in their attempts to respect the principles contained in this instrument. The Free Confederation of Workers of Mauritania (Confédération libre des Travailleurs de Mauritanie, CLTM) gives a historical background of MNEs' activities in the country. MNEs have been in Mauritania since the 1950s, mainly in the mining sector -- e.g. copper, mineral exploration (four companies named), as well as in related distribution services. After independence, the Government adopted a policy of encouraging nationals to invest in sectors hitherto dominated by MNEs -- i.e. trade, manufacturing, banking and insurance. The already small number of MNEs decreased significantly in the mid-1970s, mainly due to nationalization, the creation of a local currency and the development of private local capital. The lack of basic infrastructure and the small size of the domestic market also contributed to that drop. The CLTM names six MNEs active in the field of infrastructural development and reports that MNEs' activities have always been at odds with national policy objectives and the interests of workers, because these enterprises impose their rules and methods.
While many laws for attracting foreign capital have been passed, they do not take into account the principles of the Declaration. The Government has "never shown interest" in applying national laws or ILO Conventions, whether or not they have been ratified. Workers are low paid and have no health and social security coverage. Furthermore, as MNEs resort to subcontracting, workers cannot identify their employer in cases of grievances, and this also undermines job security. These practices take place "sometimes with the complicity of the Government, sometimes as a result of its inability to take the necessary action". The Government itself resorts to subcontracting. In that respect, two state companies in the mining sector and in public utilities (names given) are cited by way of example. All the addressees of the Declaration have had difficulties to implement its principles. The Government is weak and thus unable to make MNEs respect the principles concerned, while the latter have to operate in a new environment, marked by different mentalities and a changed legal framework. As for the workers, they encounter problems due to the absence of social dialogue and the lack of political will on the part of the Government to ensure that laws and regulations are respected. The judicial system is characterized by serious deficiencies as no specific training is provided for dealing with the settlement of labour disputes.
The Government of Mauritius states that the activities of MNEs have, so far, not given rise to any conflicts with national policy objectives or with the interests of workers.
The Government of Mexico states that MNEs act in accordance with national policy objectives. During the period under review their activities did not conflict with those objectives nor with the interests of workers. It provides an annex listing the laws governing different industrial activities and trade, which were either amended or enacted between 1989 and 1994. Among them is the Foreign Investment Act (27.12.1993) which is intended to create a favourable investment climate, make the country competitive in the global economy and establish clear rules for inward investment in productive activities. National treatment for foreign investors, the lifting of restrictions on foreign participation in different sectors of the domestic economy and the simplification of administrative procedures for investment, are central features of the new regulatory framework, which is consistent with the national Constitution. In 1995, the national Constitution (paragraph 4, section 28) was amended, thereby facilitating greater foreign participation in the following sectors and industries: banking and finance; satellite communications, railway transport; petroleum extraction and specialized air transport. The NAFTA and the North American Parallel Agreement on Labour Cooperation between the United States, Mexico and Canada came into force during the period under review. Their provisions pertaining to job creation, improvement of working conditions and living standards, and the protection of workers' rights, demonstrate the commitment of the signatories to creating a larger and stable market for trade in goods and services, while taking into account the social dimensions of such economic initiatives. The National Development Plan 1995-2000 recognizes the importance of foreign private capital for the domestic economy and the contribution of MNEs to infrastructural, technological and economic development. There have been no difficulties as regards the observance of the Tripartite Declaration by MNEs. The Mexican Confederation of Chambers of Industry (CONCAMIN) reports that from the employers' point of view the presence and activities of MNEs have not given rise to conflicts. All the national laws in force apply to MNEs. Multinationals continue to create jobs and they comply with all the laws, including those pertaining to labour. It notes in particular the coverage and observance of the Parallel Cooperation Agreements in the Labour and Environmental Fields (Tratados Paralelos de Cooperación en Materia Laboral y Ambiental). With regard to economic liberalization and globalization, Mexico has signed many commercial agreements. These, together with its membership in the WTO and the OECD, have created a favourable climate for FDI. Even though no new laws to further the aims of the Declaration have been passed, no difficulties have arisen with regard to the application of the Tripartite Declaration, the principles of which are reflected in the provisions of the national Constitution and those of the national labour laws. MNEs' practices in relation to employment, training and OSH are in line with, and sometimes exceed the national requirements. The Confederation of Mexican Workers states that the law does not distinguish between national and multinational enterprises when it comes to the right to organize and bargain collectively. The principles contained in ratified ILO Conventions and their corresponding Recommendations are incorporated in the national labour legislation.
The Government of Namibia replies in the negative to all three questions.
The Government of the Netherlands states that its reply to the last survey is still applicable. It emphasizes that MNEs are treated in the same way as national enterprises and that the country's laws and regulations in all fields apply to enterprises without distinction. The Federation of Netherlands Industry and Employers agrees with the Government.
The Government states that New Zealand welcomes and encourages foreign investment. MNEs are seen as making a positive contribution to the economy by increasing private capital inflows, upgrading skills and technologies, promoting competition, efficiency and exports, and creating jobs. During the period covered by the survey, the Overseas Investment Amendment Act 1995 was passed and accompanying Regulations were issued. The new regulatory framework streamlines administrative procedures for processing and approving investment applications. MNEs must obtain approval to acquire or take control (i.e., 25 per cent or more ownership or controlling interest) of assets in the country. The fact that few applications are refused attests to the favourable attitude towards foreign investors. In 1994, the US accounted for the largest number of all approvals for FDI (23 per cent), followed by Australia (14 per cent) and the territory of Hong Kong (11 per cent). Commercial leasing, financial services and forestry were the main activities of interest to investors. There is an Overseas Investment Commission which monitors compliance with the statutory requirements governing inward investment, and the Government is of the view that this will make it possible to assess the degree of observance of the Tripartite Declaration. MNEs, like local enterprises, must abide by the national laws in force. The New Zealand Employers' Federation concurs with the Government.
The Government of Nicaragua replies in the negative to all the questions.
The Government of Nigeria reports that MNEs' activities have not given rise to conflict either with the principles of the Tripartite Declaration or with national policy objectives. However, even though most MNEs are downsizing in order to remain more competitive, the interests of workers are taken into account when determining dismissal compensation. Most national policy objectives are reflected in legislation or policy statements. During the period under review, the Nigerian Enterprises Promotion Act, 1972 and the Exchange Control Act, 1972, were amended to attract foreign investment. MNEs can now own and operate businesses in sectors hitherto reserved for nationals or where the level of their participation was restricted. Limits on the amount of foreign capital allowed into the country have also been removed. The observations made by the Nigeria Employers' Consultative Association are similar to the Government's. The Nigeria Labour Congress (NLC) reports that the activities of MNEs in the petroleum sector, particularly as regards their persistent demands to increase the prices of petroleum products, have often conflicted with the national policy objective of stabilizing domestic price levels and controlling inflation. Price increases in response to those pressures have greatly eroded workers' incomes and exacerbated poverty levels. The NLC is not aware of any new laws, policy changes or action taken to further the aims of the Tripartite Declaration. No difficulties have arisen with regard to attempts to respect the principles of the Declaration.
National legislation in Norway incorporates the principles of the Tripartite Declaration and MNEs are governed by the same regulations as national enterprises. The Government of Norway notes that the activities of MNEs have not given rise to conflicts with national policy objectives. Efforts to improve industrial relations in particular, have resulted in several legislative measures relating to enterprises which also further the aims of the Declaration. Following consultations with the Norwegian Federation of Trade Unions and the Confederation of Norwegian Business and Industry, it has been agreed that the requirements of the Council Directive on the Establishment of a European Works Council will be incorporated in the national legislation. Established enterprise structures are undergoing rapid transformation due to changes in ownership, for example, as a result of mergers and sell offs. These developments are raising new questions about the protection of workers' rights. A Committee is studying these problems with the aim of making the legislation "more precise". The Confederation of Norwegian Business and Industry shares the views expressed by the Government.
The Government of Pakistan states that MNEs' activities have not given rise to conflicts with national policy objectives because policies are often formulated taking into consideration the problems faced by workers. Therefore, workers' interests are protected to the greatest extent possible. No new laws to further the aims of the Declaration were passed. The labour legislation in force regulates the terms and conditions of employment of workers in MNEs and guarantees the protection of their rights. According to the Employers' Federation of Pakistan (EFP), the activities of MNEs have contributed greatly to industrial growth and development. Thirty-three of the top 101 companies (ranked by market value of assets) are MNEs. They have contributed to the following: increased job opportunities; HRD; the transfer of technology (including automation and information technologies); and new methods for factory construction and the provision of financial services. MNEs have played an important role in the field of education on business and economic issues and launched research and development programmes. According to a recent survey of 100 enterprises in Pakistan (no date given), the value of their investment was approximately Rs.10 billion, with sales revenues of Rs.40 billion (about 4 per cent of GDP). They contribute about one-sixth of the Government's total tax revenues, and provide about 50,000 jobs. MNEs' activities do not appear to have violated any national labour legislation or ILO Conventions. The EFP is of the view that MNEs are more "considerate and sympathetic towards their employees compared to national counterparts", particularly in matters relating to freedom of association. They are also more willing to enter into negotiations and have profit-sharing arrangements. National financial and investment regulations were changed to encourage FDI, and this led to an increase in the number of MNEs locating in the country. However, on the whole, the same legislation applies to all enterprises. The Government is planning to amend the Labour Policy in order to provide greater security for contract labour. No difficulties have arisen in attempts to respect the aims of the Declaration.
The Government of Poland reports that the presence of MNEs in the country is a relatively new phenomenon and that no comprehensive research on aspects of this development has been undertaken so far. The national labour legislation makes no distinction between local and foreign enterprises. All enterprises, regardless of their ownership, must respect the laws in force. In privatized former SOEs, the practice is for representatives of the future employers and organizations representing the workers concerned to conclude "social agreements" which guarantee that certain workers' rights and privileges will be preserved. These include the maintenance of current employment levels for between one and a half and two years after the change of ownership, and similar commitments with respect to wages and social security entitlements. The Government's reply focuses on a sample of 2,319 enterprises which were inspected in 1995. They had a combined workforce of 276,076. Comprising wholly foreign-owned MNEs, public-foreign private joint ventures and private local and foreign joint ventures, they are referred to by the Labour Inspectorate as MNEs. The Independent Self-Governing Trade Union "Solidarno" (Poland) reports that overall, MNEs' activities have not given rise to conflicts, and that these enterprises have had a positive impact on the labour market and the national economy as a whole. No new legislation of relevance to the Tripartite Declaration was passed during the period under review. There were difficulties with a joint venture in the automobile industry in Warsaw, involving a partner from an EU country (company named). In 1995, the new board of the enterprise attempted to impose changes on the "trade union statute and structures".
The Government states that the Constitution of Portugal requires that foreign investment be consonant with the country's development goals and workers' interests. During the period under review, Executive Order No. 312/95 of 28 November relating to foreign investment came into force.Foreign participation is seen as a means of creating jobs, boosting private capital inflows, and promoting more value-added activities, greater competition and internationalization. MNEs must observe the labour legislation. Official research on enterprises with 50 per cent or more foreign capital and at least 150 workers, found that the principles of the Tripartite Declaration are generally respected. Most MNEs originate from Switzerland, the Netherlands, Germany and France. They experience no difficulty in complying with the national laws and regulations which also apply to locally owned enterprises. In a few cases they observe higher standards as regards wages and benefits. FDI is channelled mainly into the textile and clothing, footwear, chemical, ceramics, food, electronics and motor vehicle industries. Jobs in labour-intensive industries tend to be less secure because production varies according to fluctuating market demand and changing requirements by management. The General Union of Workers (UGT) notes that economic globalization has provoked apprehensions about the possible relocation of MNEs to countries offering more advantageous conditions. However, on the whole, MNEs play a major role in the social and economic development of host countries and have positive effects on employment, investment and technological development. In recent years Portugal has intensified efforts to encourage MNEs, but the effects have not always been as expected. The arrival of MNEs may lead to the closure of other establishments with the resultant loss of jobs. There is also uncertainty as to whether the MNE would not eventually relocate, causing further redundancies. Initially, multinationals create direct jobs as well as indirect employment. Those that produce for the domestic market tend to respect fully the national labour laws and avoid disputes with workers and the Government. While those that essentially produce for export also take steps to avoid disputes, their interests supersede those of workers if a dispute does arise and they take little account of national policy objectives. The fact that the locus of decision-making is abroad makes it difficult to harmonize the enterprise's goals with national policy objectives. When there are consultations with the Government, the emphasis is on the company's interests rather than on the host country's economic and social development. The UGT argues that it is the Government's responsibility to get MNEs to reconcile these objectives. Except for "certain unusual cases" dialogue with trade unions is relatively uncommon and unions find it hard to establish themselves in MNEs.
The Government of Romania reports that activities by MNEs have not given rise to conflicts with national policy objectives or with the interests of workers. During the period covered by the survey, Act 57/1993 (section II) to amend Act No. 35/1991 concerning foreign investment was adopted to facilitate the activities of foreign investors. Difficulties with regard to the observance of the Declaration have arisen because the views of the national employers' and workers' organizations in Romania are not taken into account.
The St. Vincent Employers' Federation states that on the whole the activities of MNEs have not given rise to conflicts. However, there was one case in which a multinational (unnamed) closed its operations and relocated without giving due notice to the workers. Despite intervention by the Government it left without paying the necessary compensation to workers. No new laws of relevance to the Tripartite Declaration have been passed. Failure to observe the principles of freedom of association and collective bargaining far exceeds initiatives to apply them.
The Singapore National Employers' Federation replies that on the whole the country's experience with MNEs can be considered as positive, as regards employment and labour relations, training and the transfer of technology. In a context marked by macroeconomic changes, global economic developments, and projected slower economic growth, national enterprises will have to take certain internal measures to remain competitive.
The Government of Slovakia states that article 35 of the national Constitution guarantees everyone including all enterprises, the right to engage in entrepreneurial activities. Existing legislation enables MNEs to engage in such activities in accordance with the relevant regulations. The operations of MNEs have not given rise to conflict with the interests of workers.
The Government of Slovenia states that there are only a limited number of MNEs (six named) located in the country and they must abide by the relevant legislation. Enterprises with Slovene participation operating abroad must respect the legislation of the host countries and they do not have any influence on the social policies of these countries. There is no information to suggest that the activities of MNEs or domestic enterprises have given rise to conflicts with national policy objectives or the interests of workers. No difficulties have arisen for any of the addressees of the Tripartite Declaration in their attempts to respect its principles during the period under review.
The Government of Spain states that the labour legislation makes no distinction between enterprises on the basis of ownership and it therefore applies to both national enterprises and MNEs. In this regard it mentions Royal Decree 2/1995 of 7 April 1995 which approved the amended Labour Procedure Act and Act 14/1994 of 1 June concerning temporary work enterprises (empresas de trabajo temporal). As a member of the EU, Spain has until 22 September 1996 to incorporate into its laws and regulations, the provisions of "Council Directive 94/45/EC of 22 September 1994 on the establishment of a European Works Council or a procedure in Community-scale undertakings and Community-scale groups of undertakings for the purposes of informing and consulting employees". The General Union of Workers (UGT) reports that there is no national policy for coordinating investment by MNEs with the interests of workers, in accordance with the spirit of the Tripartite Declaration. Foreign investment is given priority with a view to fulfilling macroeconomic and commercial goals. Over the last few years, many MNEs in different sectors have been disinvesting, cutting output or relocating plants, because of the economic crisis and in keeping with the business strategies of parent companies. No compromises or efforts to maintain investment were made, even though in most cases, the enterprises had in the past, made high profits in Spain. Five enterprises were cited by way of example (names given). Even where governmental authorities proposed short and medium-term solutions (e.g. new business partners, change in activities etc.) they were unable to prevent MNEs from downsizing and restructuring, generally at great social costs. No new laws were passed or measures adopted in a bid to fulfil the aims of the Tripartite Declaration. The general policy has been to encourage inward FDI without focusing on the social dimension. MNEs take advantage of favourable economic conditions to make large profits and leave in times of economic crisis, leaving the State to deal with the unemployment resulting from their actions. Neither the Government nor employers attach importance to the Tripartite Declaration. They are driven by market considerations and the commitment to liberalization. Trade unions are in a weak bargaining position. Enterprises begin by proposing complete plant closures and unions find themselves having to settle for drastic reductions in both staff and labour rights. There have even been cases in which MNEs have called for a reorganization of the local enterprises which they want to acquire. This usually entails staff cuts (particularly as regards older and less qualified workers), the curtailing of labour rights and reduction of social security coverage. The Government generally fulfils these demands with not much objection, with the State bearing the cost of the measures. Such situations arose with regard to the sale of three enterprises in the telecommunication sector (names of enterprises given).
The open market policies of Sri Lanka actively encourage FDI by MNEs. According to the Government, no conflicts with either national policy objectives or workers' interests have arisen as a result of MNEs' activities. During the period covered by the survey, the Emergency Regulations which had been in force for over a decade were lifted, allowing workers, especially those in EPZs, to exercise their rights to freedom of association and to organize. No difficulties have arisen with regard to respecting the principles of the Declaration. The Employers' Federation of Ceylon, referring to MNEs that belong to its organization, reports that they strictly follow the labour legislation of Sri Lanka. The Lanka Jathika Estate Workers' Union concurs with the statement by the Government of Sri Lanka that the open market policies encourage MNEs to invest in the local economy, and adds that they are expected to make a meaningful contribution to national economic development. EPZs have been established to promote FDI and create greater employment opportunities for youth. Most of the workforce in the zones is made up of young women. As regards the terms and conditions of employment in the zones, there have been repeated complaints in various fora dealing with labour issues, that workers employed in the zones "do not seem to get a fair deal from their employers".
The Government of Swaziland replies in the negative to all three questions.
MNEs behave no differently from domestic enterprises, and they must comply with the national laws and regulations, reports the Government of Sweden. With very few exceptions, they cooperate satisfactorily with the competent authorities and organizations representing the social partners. During the period under review Sweden became a member of the EU. Many restrictions on inward foreign investment have been eliminated. Foreign participation in local enterprises has been facilitated with the repeal of the Law on Foreign Acquisition of Swedish Firms in 1992. Legislation concerning the acquisition of real estate for commercial use was also amended. In 1993 the monopoly on postal services and job placement agencies was abolished, and a new law enabling competition in the telecommunication industry was introduced. Parliament passed a resolution calling for greater efforts to encourage inward foreign investment, and, to this end, the Invest in Sweden Agency was set up in July 1995. Since July 1994 the Swedish National Board for Industrial and Technical Development (NUTEK) has been made responsible for collecting and publishing on a regular basis, statistics on foreign-based Swedish MNEs and foreign-owned MNEs in Sweden. The Swedish Employers' Confederation and the Federation of Swedish Industries state that they have nothing to add to the Government's report. The Swedish Confederation of Trade Unions (LO) and the Confederation of Professional Employees (TCO) reiterate the observations made in replies to previous surveys, about the "the poor state of knowledge" of the Tripartite Declaration.
The Government of Switzerland states that the Swiss economy is to a great extent export oriented and that the Tripartite Declaration is of relevance to a large number of enterprises of varying sizes. Foreign MNEs, particularly those with regional offices in Switzerland, tend to act in accordance with directives issued by the parent company. Inasmuch as the effects of these directives are not felt in Switzerland, the Government would have no means of intervening in this regard. The Central Union of Swiss Employers' Associations (UCAPS) reports that its reply concerns only foreign-owned enterprises operating in Switzerland. It is not aware of activities of MNEs having conflicted with national policy objectives or workers' interest during the period covered by the survey. The Tripartite Declaration is fully accepted and its voluntary nature should be maintained. Subsidiaries of MNEs in Switzerland have the possibility of joining sectoral or regional employers' organizations, which are members of UCAPS. During the period under review, the Workers' Participation Act (December 1993) and the Federal Act on Equality between Men and Women (March 1995) were enacted. The principles of the Declaration are fully respected. The Federation of Commerce, Transport and Food Industries Workers' Union (FCTA) reports that no conflicts have arisen as a result of MNEs' activities in the sectors or industries governed by collective agreements concluded with the FCTA. A growing number of multinationals in retailing (names given) are joining other long-established MNEs operating in the food industry in Switzerland (names given). The Federation of Swiss Salaried Employees' Associations (VSA) notes its special interest in relations between the social partners (para. 3 of the Tripartite Declaration). It underlines the importance of furthering the aims of the Declaration through appropriate laws and policies, and through cooperation among governments and organizations of employers and workers in all countries. The VSA expresses the wish that the ILO would elaborate a binding instrument to that effect. Such an instrument would take into account the large economic and social disparities among host countries, situations in which hostcountries have comparable levels of development and the fact that the national legislation of certain countries may contain loopholes that facilitate the abuse of economic power.
The Government of the Syrian Arab Republic reports that MNEs' activities do not conflict with national policy objectives nor with workers' interests. Measures to promote the goals of the Declaration have been reinforced. Since July 1991, a new law has been in force, providing for tax reductions. None of the addressees of the Declaration have faced difficulties in implementing its principles. The reply of the Chamber of Industry is the same as that submitted by the Government of the Syrian Arab Republic.
The Government of Thailand reports that some MNEs "strongly impose" anti-union restrictions by discouraging employees from exercising their rights to freedom of association and collective bargaining. The growing use of capital-intensive technologies by MNEs together with rising labour costs are making workers more vulnerable to job displacement. In recognition of this, laws such as the Notification of the Ministry of Labour and Social Welfare Respecting Labour Protection (on severance pay), have been amended. Their principles are in line with those of the Declaration concerning the protection of workers. The Notification has been amended to provide for special severance pay in the event of redundancies caused by the introduction of, or changes in, the machinery or technology used. No difficulties have arisen as regards the application of the principles of the Declaration.
The Government of Trinidad and Tobago
replies that conflicts have arisen mainly in the field of occupational safety. New
policies and laws of relevance to the Tripartite Declaration were adopted during the
period under review. There have been no difficulties as regards the observance of the
Tripartite Declaration. The Employers' Consultative Association of Trinidad and Tobago
responds in the negative to all three questions.
According to the Government of Tunisia, MNEs are always encouraged to set up business in the country, and to respect national and international labour standards, and in particular the principles of the Tripartite Declaration. Since 1972, a number of laws designed to promote foreign investment have been adopted. To date, the socio-economic impact of MNEs has been satisfactory, and their presence has never given rise to conflicts with national policy objectives and workers' interests. MNEs have contributed to an increase in job opportunities, and to qualitative improvements in the domestic economy. During the period under review, the following laws were enacted: Act No. 93-120 of 27 December 1993 concerning the Code for Promoting Investments. This Code brings together into a single text the provisions of different sectoral codes dealing with investment in manufacturing, agriculture and fishing, services and tourism. It establishes the regime for encouraging both local and foreign investment, as well as joint ventures. It is also part of a general development strategy, of which one of the principal aims is to accelerate the creation of employment. A Ministry for International Cooperation and Foreign Investment, as well as an Agency for the Promotion of Foreign Investment, have been set up. Act No. 92-81 of 3 August 1992 concerning the creation of free economic zones has been amended by Act No. 94-14 of 31 January 1994. During the survey period, plans were made for the amending of Act No. 94-42 of 7 March 1994 establishing a regime for companies involved in international trade. In January 1995 Tunisia ratified the agreements concluded under the Uruguay Round, and in July it signed an Association Agreement with the EU. The Tunisian Confederation of Industry, Trade and Handicrafts, which groups both national and multinational enterprises, encourages the establishment of MNEs throughout the country in accordance with the spirit of international and local labour standards, and the principles of the Tripartite Declaration. Act 72/38 offered attractive concessions for promoting foreign investment and the establishment of MNEs. It was amended in 1987 to introduce flexibility. MNEs can now recruit four foreign employees per enterprise without administrative formalities, provided they are professional or managerial staff. Moreover, in 1990, a law was passed allowing both local and foreign employees with valid employment contracts, to transfer up to 50 per cent of their salaries outside the country. MNEs operating in Tunisia have had satisfactory social and economic effects and their activities have never given rise to conflicts with national policy objectives or workers'interests. The principles embodied in the Conventions mentioned are applied.
The Government of Turkey recognizes the importance of foreign capital and MNEs for attaining one of the national policy objectives -- i.e. achieving international competitiveness. Several initiatives have been taken to establish a legal framework in which competitiveness, consumer protection, and the protection of intellectual property rights would be furthered. Law No. 4077 on the Protection of Competition (23 February 1995), Law No. 4054 on Consumer Protection (7 December 1994) and Government Decree No. KHK/551 on the Protection of Patent Rights (24 June 1995), were issued. During the period under review, new labour market policies were considered for implementation in 1996. An intergovernmental agreement for the creation of a customs union between Turkey and the EU was reached. The Turkish Confederation of Employer Associations states that technological developments have had a profound impact on the influence and circulation of investment capital, as countries seek to achieve higher levels of competitiveness in the global economy. It shares the Government's view that MNEs can make a positive contribution to this effort. The Confederation of Turkish Trade Unions notes that the activities of some MNEs have given rise to conflict with workers' interests. Some have been reluctant to acknowledge basic trade union rights and have dismissed workers who may belong to trade unions. Certain MNEs have told workers that they would relocate, if they were to become unionized. No new laws have been promulgated or policy changes made to further the aims of the Declaration. Trade unions have been experiencing increasing difficulties to organize workers in MNEs.
The Government of the United Kingdom supports the principles of the Tripartite Declaration. It endorses its voluntary nature which it sees as offering flexibility and accommodating the needs and circumstances of both enterprises and workers. It says that "it is not immediately clear why multinationalism may lead to abuses or indeed if it will lead to a concentration of economic power at all", and adds that FDI may be an important source of competition for many economies. Since the last survey, several new laws and regulations were passed, including the following: the Trade Union Reform and Employment Rights Act, 1993; the Sunday Trading Act, 1994; the Deregulation and Contracting Out Act, 1994; the Maternity (Compulsory Leave) Regulations, 1994; and the Employment Protection (Part-time Employees) Regulations, 1995. The Government has had no difficulties in applying the principles of the Declaration. The Confederation of British Industry (CBI) notes that its report concerns only MNEs operating in the United Kingdom. These enterprises support the principles of the Tripartite Declaration, and their conduct is like that of large national companies. There are no reports of MNEs in the United Kingdom having difficulties in applying the Declaration. The CBI points out that during the period covered by the survey, a Council Directive on the establishment of European Works Councils was adopted, and that it applies specifically to MNEs.
The Government of the United States regards the Tripartite Declaration as being important for the emergence of mutually beneficial relationships among business, labour and the Government. By clarifying mutual expectations as regards social policy, it can help to foster an open and stable environment for investment, through which MNEs can make important positive contributions to economic and social development at the national and international levels. In view of the changing nature of foreign investment, the US believes that the definition of a multinational enterprise (paragraph 6) should remain broad and flexible since it encompasses the constantly changing form of activities by MNEs, which can involve both equity and non-equity relationships. In addition, it is essential that the Declaration is addressed to private, state and mixed enterprises. In view of the variety of practices in the field of labour relations, a voluntary Declaration based on general principles is the most appropriate means for dealing with MNE-related issues. Only such an instrument can gain the universal acceptance necessary for it to fulfil its potential role as an important complement to national labour law, contracts, international law and treaties. The obligations and requirements of US labour and employment laws apply to domestic and foreign enterprises. Following extensive consultations with representatives of business and labour, a voluntary statement of business principles governing the conduct of US multinationals operating abroad was adopted in 1995. The "Model Business Principles" (MBPs) urge MNEs to provide a safe workplace, recognize the right to organize and not to use either forced labour or child labour in their operations. They are asked to report on a voluntary basis on their overseas activities. The MBPs, which are based on similar sets of principles already applied by US enterprises in their global operations, are to be used as guidelines for the drafting of company-specific codes of conduct. The provisions of the MBPs are essentially the same as those contained in the OECD Guidelines for Multinational Enterprises and the ILO's Tripartite Declaration.
The Government of Uruguay replies in the negative to all the questions.
The Government of Venezuela replies in the negative to all three questions. The Venezuelan Federation of Chambers of Commerce and Manufacturers' Associations states that the transnational scope of MNEs' activities does not give rise to an abuse of concentration of economic power, nor to conflicts of interest with the host country. Workers in MNEs have greater prospects of, and possibilities for, being trained to use new technologies, and the competence they acquire is passed on to others in the society. The national labour laws are stringent, well enforced, and their application in large enterprises is more closely monitored than in smaller, locally owned and public enterprises. MNEs respect the laws in force and in most cases they conclude collective agreements offering better benefits than comparable local companies. They invest heavily in HRD and social programmes which have positive social and economic effects.
The Government of Zambia states that it has always been mindful of the significant contribution that MNEs could make in alleviating unemployment and improving social conditions, and that, for this reason, the partnership of MNEs in national development has been consistently sought and encouraged. In order to promote the political reforms and economic liberalization now under way in the country, a new Investment Act was introduced in 1993. It seeks to create a favourable environment for foreign investment by providing for, inter alia, the setting up of an Investment Centre. The Centre is to promote and coordinate investment policies, process applications from potential investors, and grant operating licences to those whose applications have been approved. Despite the influx of FDI, MNEs' activities have not given rise to any incidents of conflict with national policy objectives nor with workers' interests. Since the last Survey, no new laws have been promulgated nor policy changes made, to further the aims of the Declaration.
The Government of Zimbabwe replies that the activities of MNEs have not given rise to conflicts with national policy objectives in the field of labour, nor with workers' interests. During the period under review, the Labour Relations Act, No. 16 of 1985 was amended by the Labour Relations Amendment Act No. 12 of 1992. The aim is to introduce more flexible labour laws for the implementation of the Structural Adjustment Programme. This amendment established employment codes of conduct which are also applicable to MNEs. The addressees have had no difficulties in respecting the principles of the Tripartite Declaration. The Employers' Confederation of Zimbabwe states that the activities of MNEs have not given rise to conflicts with national policy objectives and the interest of workers. It noted that there were some amendments to the labour legislation to enhance the principles of collective bargaining and freedom of association, and confirms that no difficulties have arisen in attempts to respect the principles of the Declaration.