EurWORK European Observatory of Working Life

International Framework Agreement

Definition

An International Framework Agreement (IFA) or Global Framework Agreement (GFA) serves to establish an ongoing relationship between a multinational enterprise and a Global Union Federation (GUF) to ensure that the company adheres to the same standards in every country in which it operates.

Current status

IFAs have a global scope of application and are signed by GUFs. The principle purpose of IFAs is to ensure that international labour standards are maintained in all of the target company’s locations. (In contrast, European Framework Agreements (EFAs) have a regional (European) scope of application).

As supply chains are now increasingly international, IFAs are being used to promote decent work beyond the company’s borders, as described by the International Labour Organization (ILO): ‘most of the IFAs signed after 2009 also contain provisions to the suppliers of the multinational enterprise’. [1]

The ILO notes an increase in the number of IFAs signed year on year between 2000 and 2016, reaching 115 agreements in 2016. The European Commission has launched a database of transnational company agreements, including both IFAs and EFAs, which shows that 10 additional IFAs were concluded in 2017 and 8 in 2018. IFAs tend to be concentrated in metal, construction, chemicals, food and service sectors, and it is generally considered that such negotiations are initiated by trade unions.

Regulatory aspects

There are no legal enforcement mechanisms for IFAs at the global level. Although to date there have been relatively few examples of complaints in regard to an IFA, in January 2019 IndustriALL suspended its global declaration on social rights and industrial relations at automotive company Volkswagen, for the reason that the enterprise refused to allow workers at one of its plants in the United States to join a union. [2] This example demonstrates that any complaints that are raised often relate to breaches of IFA provisions on freedom of association and the right to collective bargaining.

Since IFAs serve to promote key features of the respective national models of social partnership and cooperative industrial relations, they are more relevant to companies that have headquarters located in social market economies where collective interest representation is the basis for the regulation of work and the labour market. It is therefore not surprising that the spread of IFAs has so far remained quite limited among transnational enterprises from outside continental Europe, despite recent new initiatives such as the agreement concluded in 2018 by UNI Global Union and Brazilian banking company Banco Itaú. [3]

Background information

The term 'International Framework Agreement' is used to distinguish negotiated agreements from the type of voluntary codes of conduct that corporations adopt unilaterally to demonstrate their commitment to corporate social responsibility. As such, the negotiation of IFAs can be viewed as the start of collective bargaining at transnational company level. The GUFs therefore view IFAs as an opportunity to engage companies’ operations in a process of private standard-setting to improve conditions for workers and trade unions worldwide. Indeed, several GUFs have developed their own guidelines to promote the negotiation and implementation of IFAs, such as IndustriALL’s guidelines for GFAs. [4]

All IFAs reference the ILO’s eight core labour conventions, [5] and in recent decades, they have improved further in qualitative terms by making use of the UN’s Guiding Principles on Business and Human Rights and Universal Declaration of Human Rights, along with the Organisation for Economic Co-operation and Development's Guidelines for Multinational Enterprises.

More recently, several agreements have extended beyond the recognition of the ILO’s core labour standards by ensuring decent wages and working conditions, as well as a safe environment. One example is the renewed agreement signed by Carrefour and UNI Global Union in 2018, which builds on previous agreements to include new provisions addressing the issue of violence against women at work. [6] Another example is the IFA concluded by BNP Paribas and UNI Global Union in October 2018, which was ‘the first in the financial sector planning paid parental leave provisions and the first with guaranteed health, life, and disability insurance’. [7]

Implementing IFAs

In order to have an impact, it is important to make provision for an IFA’s implementation and for its effective monitoring. The European Trade Union Confederation and BusinessEurope recognise that actors can face difficulties in taking ownership of the agreement at the local level. They identify three areas for innovation and experimentation in relation to the implementation of transnational company agreements:

  • a strong commitment from both human resources managers and trade unions in the dissemination of the agreement
  • the significant role of European or global works councils in monitoring the implementation of the agreement
  • the development of new follow-up instruments, such as quantitative and qualitative indicators or national action plans.

Related dictionary terms

Codes of conduct collective bargaining corporate social responsibility decent work European collective agreements European Framework Agreement labour standards social dialogue transnational company agreement.


References

  1. ^ ILO (2018), International Framework Agreements in the food retail, garment and chemicals sectors: Lessons learned from three case studies , Geneva.
  2. ^ IndustriALL (2019), IndustriALL suspends global agreement with Volkswagen , 21 January.
  3. ^ Uni Global Union (2018), UNI Global Union and Banco Itaú extend global agreement securing labour rights , 23 October.
  4. ^ IndustriALL (2014), Guidelines for Global Framework Agreements (GFAs) , Geneva.
  5. ^ ILO (1998), ILO Declaration on Fundamental Principles and Rights at Work , Geneva.
  6. ^ Carrefour (2018), UNI Global Union and Carrefour further strengthen global cooperation , Annecy.
  7. ^ Uni Global Union (2018), Global Agreement between BNP Paribas and UNI Global Union advances labour rights, gender equality for the company’s 200,000 workers worldwide , Nyon.

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