France: Globalization of Human Resources in Times of Economic Uncertainty and Political Turmoil

Last Updated: 5 February 2002
Article by Patrick Thiebart


As communication technologies and trade become increasingly international and as expatriate employment becomes more common, more companies recognize the need to become "global" and are re-engineering their entire business structures to that end.

This global growth and expansion of business has led multinational companies, under the pressure of trade unions, non-governmental organizations and consumers which are campaigning for international action against labor rights violations, to adopt ethical guidelines and voluntary workplace codes of conduct in order to maintain minimum labor standards in their subsidiaries all over the world.

Some multinational companies have even created workplace codes of conduct applicable to their vendors, licensees and suppliers and more generally to their contractors and business partners. Among these companies are Nestle, Adidas and Levi Strauss. For instance, Levi Strauss imposes penalties on contractors who violate its Global Sourcing and Operating Guidelines. If it determines that a business partner has violated the Guidelines, Levi Strauss may withdraw production from the partner’s factory, terminate the business relationship, or require the contractor to implement a corrective action plan.

Deplorable working conditions and unfair trade practices are still common in developing countries where goods are produced to be sold under well-known labels in the US, Europe and other consumer countries. However, there is no need to go to a developing country to be involved in unfair practices like bribery: the investigation of the International Olympic Committee’s actions in Salt Lake City is a reminder that bribery may also exist in the USA.


Generally, codes of conduct cover the following four main area:

  • freedom of association and the effective recognition of the right to collective bargaining;
  • the elimination of all forms of forced and compulsory labor, whether in the form of prison labor, indentured labor, bonded labor or otherwise;
  • the effective abolition of child labor;
  • the elimination of discrimination in respect of employment and occupation: no person should be subject to any discrimination in employment, including hiring, salary, benefits, advancement, discipline, termination or retirement on the basis of gender, race, religion, age, disability, sexual orientation, nationality, political opinion or social or ethnic origin.


Adopting a code of conduct is increasingly perceived by multinational companies as necessary or appropriate for the following reasons:

  • to be seen socially responsible;
  • to enhance the company’s reputation by demonstrating, for example, integrity and other values which are seen to match the organization’s business;
  • to give guidelines to employees and business partners on what conduct is acceptable and what is not;
  • to proceed with the global integration by establishing a global branding or image acceptable across the world.


1) Is there such a thing as an effective international code of conduct ?

Critics have argued that there are simply too many legal and cultural obstacles to implementing and enforcing a viable and consistent set of uniform global employment policies and practices. Furthermore, senior executives and shareholders generally are far less interested in social and ethical issues than in bottom-line financial information such as earnings and cash flows.

No one can deny that employment laws in the international arena may differ significantly according to the legal, social, political and economic forces in each country. Indeed, while employment relationships in the US are governed by private arrangements, which are voluntarily, entered into between employers and employees, they generally consist in other industrialized countries in a comprehensive and paternalistic set of legal rules whose main purpose is to protect employees in their subordinate relations vis-à-vis their employers. As a result, most employment laws in industrialized countries and in particular in Western Europe are more employee-friendly than US employment law (including California law) and tend to regulate the employment relationship far more intrusively than does the US.

However, codes of conduct may rely upon some employment doctrines emerging from global bodies such as the World Trade Organization, the International Labor Organization, the Organization for Economic Cooperation and Development and some regional trade regulations. The World Trade Organization (W.T.O.) has been discussing enshrining labor rights to trading agreements and treaties, and the World Bank is proposing to tie loans to compliance with minimum standards.

2) The I.L.O and its initiatives relating to global codes of conduct

There are initiatives from the International Labor Organization with respect to international corporate compliance programs.

Even if the ILO does not have any enforcement powers, it is an international body, which is able, by its constant pressure, to create an influence over countries not dealing in a democratic way in matters regarding workers and exposing children to hard labor. The ILO is also an important factor in the industrialized countries where the various ILO Conventions are being a significant tool in the structure of the labor force and their rights and duties (e.g. ILO Conventions 29 and 105 on forced and bonded labour; ILO Convention 87 on freedom of association; ILO Convention 182 on worst forms of child labour).

As a result, no country that is a member of ILO is keen to be pointed out as not complying with its conventions.

The key international labor standards are the core ILO standards through various programs aimed at promoting certain projects (e.g. the project on prevention of child labor which is including the prevention of slavery and prostitution). Since 1995, the International Labor Organization has been seeking to encourage as many countries as possible to sign "core" conventions of the ILO, including those relating to:

  • the right of freedom of association;
  • the right to organize and bargaining collectively;
  • the abolition of forced labor;
  • the respect of the minimum employment age regarding child labor;
  • equal pay for work of equal value; and
  • non-discrimination in employment.

In June 1998, the ILO issued its Declaration on Fundamental Principles and Rights at Work in order to promote the fundamental rights of freedom of association and right to collective bargaining, elimination of all forms of forced labor, effective abolition of child labor and the elimination of employment discrimination.

3) International trade union movement

Guidance on the international labor standards can also be seen in the "Basic Code of Conduct covering Labor Practices", which was adopted by the executive board of the International Conference of Free Trade Unions (ICFTU) in Brussels in December 1997 - by far the most representative existing global trade union - and the International Trade Secretariat (ITS).

4) The Social Accountability 8000 standard

There is a uniform independent method to measure and certify the integrity of global workplace codes of conduct – the Social Accountability 8000 standard ("SA 8000"). This standard provides a means for companies and consumers to ensure that the policy and practices of the companies whose goods they purchase meet minimum labor standards.

5) The O.E.C.D. Guidelines

The Organization for Economic Cooperation and Development has issued Guidelines for Multinational Enterprises whereby O.E.C.D. member-states are expected to recommend that multinational headquartered in their countries consider voluntarily adoption and compliance with recommended international labor standards (e.g. right to free association and collective bargaining, non-discrimination and commitment to employee training and development …).

More particularly, under the O.E.C.D. Guidelines, companies should:

  • respect the right of their employees to be represented by trade unions and other bona fide organizations and engage in constructive negotiations with them on employment conditions;
  • observe standards of employment and industrial relations not less favorable than those observed by comparable employers in the host country
  • implement their employment policies including hiring, discharge, pay, promotion and training without discrimination unless selectivity in respect of employee characteristics is in furtherance of established governmental policies which specifically promote greater equality of employment opportunity.

Even though the Guidelines are voluntary and, consequently, not legally enforceable, the O.E.C.D. Guidelines have proven, in the two decades of their existence, to be a respected point of reference for a great number of companies. Furthermore, they carry the weight of a joint Recommendation of O.E.C.D. governments. In addition, their language has influenced considerably the other codes of conduct for multinational enterprises, such as the ILO Tripartite Declaration and the Code of Conduct for Transnational Corporations of the United Nations.

The Office of Investment Affairs of the US State Department is responsible for encouraging compliance with the O.E.C.D. Guidelines.

6) Codes of conduct and Human Rights

In 1999, the United Nations issued a Global Compact consisting of nine principles covering human rights and the environment.

Furthermore, regional Human Rights Conventions (e.g. the European Convention on Human Rights of 1950, the American Convention on Human Rights of 1969 and the African Charter on Human and Peoples’ Rights of 1981) provide for the practical implementation of the principles set out more generally in the Universal Declaration of Human Rights, which covers social but also economic, cultural, as well as civil and political rights.

7) Global labor standards issued by business and industry associations

Interestingly, in a number of industries, there has been an agreement on a code of conduct. IN the E.U., the most notable so far is that reached in the textile industry between the European partners in this sector.

Outside Europe, a number of business and industry associations also have issued global labor standards. Among these are the American Chamber of Commerce in Hong Kong and the Fair Labor Association.

In 1997, the members of the Apparel Industry Partnership (A.I.P.) have created the Workplace Code of Conduct and Principles of Monitoring. To achieve the objective of establishing a means to provide the public with confidence about implementation of the Workplace Code and the Monitoring Principles, the members of the A.I.P. set forth a charter for the formation of a Fair Labor Association with the following purposes:

  • to accredit independent external monitors to conduct independent external monitoring and inspections of the facilities of the participating companies;
  • to certify whether the brands of each participating company are produced in compliance with the Fair Labor Association Standards;

E. The limit of the enforceability of international codes of conduct:

There are some standards that cannot be uniformly applied to all countries because not all countries are rich enough and sufficiently developed to apply them. This is, for instance, the case of the following standards:

  • minimum safe and healthy working environment to prevent accidents and injury to health;
  • wages and benefits;
  • working time and compensation for overtime hours.

In other words, standards must be variable, appropriate to a country’s stage of development. For example, considering a fixed minimum wage that would be applicable around the world is just an illusion. A more useful approach might be to request that wages and benefit levels be equal to minimum local law requirements or the local prevailing industry wage, whichever is higher.

In any event, harmonizing the social policies of countries within the same free trade area is a condition precedent to the implementation of codes of conduct incorporating sophisticated labor standards such as wages and benefits, working time and compensation for overtime hours.

Currently, the North American Free Trade Agreement and the European Union are the two most significant multi-jurisdictional bodies which produce labor standards. The U.S. and the European Union have each recommended core labor standards for adoption by multinational corporations.

More particularly, in 1996, the US Department of Commerce issued the US Model Business Principles in order to encourage companies to develop through codes of conduct a corporate culture that:

  • respects free expression consistent with legitimate business concerns, and does not condone political coercion in the workplace;
  • encourages good corporate citizenship and makes a positive contribution to the communities in which the company operates, and where ethical conduct is recognized, valued and exemplified by all employees.

Adoption of codes of conduct reflecting these principles is voluntary in the US Model Business Principles.

On December 7, 2000, the European Parliament issued the Charter of Fundamental Rights of the European Union, which lists the civil, political, economic and social rights of European citizens and all persons residing in the European Union.

However, it is undoubtedly easier to implement labor codes of conduct incorporating sophisticated labor standards in the European Union than in the NAFTA area. The reason for this is that, contrary to NAFTA, the E.U. is more than an agreement on free trade among its member states. It creates a single market for goods and services within the Union’s entire territory, which means that no single European state’s employment laws can be allowed to impede free movement of goods and services within Europe such as the free movement of workers guaranteed by Article 48 of the E.U. Treaty.

However, because of the reluctance of the some member states (e.g. the United Kingdom) to allow Brussels to extensively regulate social matters, because also employment initiatives have for long parts of the EU’s history required a unanimous vote of EU member states for approval, and because employment issues remain a political "hot button", the EU had only furthered its employment agenda in earnest since the mid-1990’s.

If the European Union gives rise to a significant area of international employment law practice since the mid-1990’s, this is not the case so far for NAFTA.

When NAFTA was being negotiated, US organized labor and US workers’ rights groups argued that if the North American countries were to enjoy free trade, Mexico should first have to raise its "labor standards" up to the standards of US law as it had a competitive advantage by employing workers under "lower standards". This US request has not been successful as it finally appeared that Mexico had ratified many more of the ILO conventions than had the US, and Mexico overall had a far stronger legislative record than did the US.

Therefore, under the NAFTA’s labor side agreement i.e. the North American Agreement on Labor Cooperation (NAALC), no NAFTA country has been forced to undergo any significant initiative to change its employment law enforcement mechanisms.

Essentially, the NAALC establishes a set of substantive labor principles to guide the development of domestic legislation (e.g. protection of workers in association and organization, the right to strike to protect collective interests, the prohibition on the use of forced labor, labor protections for children and young workers, the adoption of occupational health and safety standards …). It also erects a framework for extensive trilateral oversight of enforcement practices within each signatory country. However, the Side Agreement does not create any particular worker rights under domestic law. Nor does it provide sanctions to remedy violations of workers rights enumerated in the underlying Treaty.

F. Ingredients to create an effective code of conducts:

Global codes of conduct must:

  • establish clear and written workplace standards;
  • develop a questionnaire to verify and qualify compliance with the workplace standards;
  • formally convey those standards to company’s subsidiaries as well as to licensees, contractors and suppliers;
  • require local manager and contractors and suppliers to complete and submit the questionnaire to the company on a regular basis;
  • receive written certifications on a regular basis from subsidiaries as well as contractors and suppliers that standards are being met, and that employees have been informed about the standards;
  • obtain written agreement to subsidiaries and contractors and suppliers to submit to periodic inspections and audits, including by accredited external monitors, for compliance with workplace standards;
  • have company’s monitors conduct periodic audits of production records and practices of wage, hour, payroll and other employee records and practices of company factories and contractor and suppliers;
  • ensure that all subsidiaries as well as contractors and suppliers inform their employees about the workplace standards orally and through the posting of standards in a prominent place (in the local languages spoken by employees and managers) and undertake efforts to educate employees about the standards on a regular basis: in practice, many codes of conduct are not communicated properly to employees;
  • provide training on a regular basis about the workplace standards and applicable local and international law, as well as about effective monitoring practices so as to enable company monitors to be able to assess compliance with the standards;
  • have trained company monitors conduct periodic announced and unannounced visits to an appropriate sampling of company factories and facilities of contractors and suppliers to assess compliance with the workplace standards;
  • develop a secure communications channel, in a manner appropriate to the culture and situation, to enable company employees and employees of contractors and suppliers to report to the company on noncompliance with the workplace standards with security that they shall not be punished or prejudiced for doing so;
  • consult periodically with legally constituted unions representing employees at the worksite regarding the monitoring process and utilize, where company deem appropriate, the input of such unions;
  • assure that implementation of monitoring is consistent with applicable collective bargaining agreements;
  • work with local managers, contractors and suppliers to correct instances of noncompliance with the workplace standards promptly as they are discovered and to take steps to ensure that such instances do not recur conditions future business with contractors and suppliers upon compliance with the standards.


An international code of conduct that is thoughtfully designed and carefully enforced can be very influential in creating a more ethical atmosphere and deterring corporate misconducts globally. As a result, these codes are viewed by many companies as a part of an ongoing educational and informational program vis-à-vis their employees and business partners.

At a time when the U.N. Secretary General urges multinational companies to adopt international compliance programs at the World Economic Forum in Davos, arguing that codes of conduct may be legally and culturally specific and lack global impact is no longer true as there are now various models of global codes of conduct emerging from international organizations, which are respected points of reference for a great number of companies. Needless to say, codes of conduct can only be effectively developed when counsel has a firm grasp of the local law in relevant substantive areas. This may require retaining local counsel to assure that local law is being observed.

The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.