Mondelēz International V International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Association (IUF) (Pakistan)

Overview

NCP Decision Accepted
Current Status Closed
Date Submitted 18/12/2013
Date Closed 06/06/2014
Case Duration 24 weeks and 2 days
Host Country Pakistan  (Non-adhering country)
Sector Food, Agriculture and Tobacco 
Issue(s) Right to collective bargaining; abusive use of contract labour
Provisions Cited I.2  II.A.1  II.A.10  II.A.11  III.2-a  III.2-b  IV.1  IV.2  IV.4  IV.5  V.1-b  V.2-b  V.2-c  V.3  V.4-a   
Case Description In December 2013, the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco, and Allied Workers’ Association (IUF) submitted a complaint to the US NCP regarding the actions of Mondelez International in its operations in Pakistan. The complaint concerned renewal of a collective bargaining agreement, and demands for the regularisation of contract workers working at Mondelez’s Cadbury factory in Hub, Balochistan, Pakistan.
Developments The US NCP requested an additional statement from both parties. In its statement, the IUF noted that whilst the business had grown, and total employment was up, formal employment was decreasing. Of around 700 workers, 650 of these were employed on a ‘no work, no pay’ basis – casual workers had no sickness or old-age insurance. The IUF stated that many of the casual workers had been doing the same job as formal employees for up to seven years, and that this constituted a 'disguised employment relationship' under ILO Employment Recommendation 198, (referenced in the Commentary of Chapter V of the Guidelines).

Mondelez did not submit an additional statement so the US NCP collated arguments directly from its correspondence with the company. Mondelez pointed to the involvement of contract workers in other collective bargaining processes, for example, membership of the Coca-Cola union. The company used this as a demonstration of the ability of casual workers to organise successfully, thus negating the necessity of IUF involvement. Mondelez alleged that the IUF was attempting to indirectly organise casual workers through the NCP process, which was an abuse of procedure. The company stated that these factors, combined with public demonstrations at the facility, contributed to a climate of confusion and uncertainty which impeded the collective bargaining process.

Mondelez reported use of the collective bargaining framework, prescribed under national law, to reach an agreement in May 2014. It alleged that the IUF interfered with this process. The IUF referred to this negotiation in its statement: ''A two-year collective bargaining agreement [was] concluded in May 2014'', which contained ''nothing on the status of the contract workers''.

Outcome The US NCP offered the parties mediation, which was refused by Mondelez. Mondelez has refused any negotiations further to those conducted under Pakistani law. The NCP supported further examination of efforts to formalise casual/contract workers “as their presence seems, by number alone, to be critical to the work of the permanent workers.” The NCP positively noted the regularisation by Mondelez of some contract workers. Regarding the correct process by which to negotiate the regularisation of Mondelez’ workforce, the NCP suggested that “contract workers being able to form unions at agencies where they do not work may be a barrier to meaningful bargaining.” The NCP recommended that the IUF “engage directly with the agencies of the contract workers” as a more expedient means of redressing conflict concerning fair labour practices.

Organisations

Lead NCP US NCP : Single Department with Interagency Working Group 

Companies

Multinational Company Mondelez International (Home country: US)

Complainants

Lead Complainant International Union of Food Workers (IUF) : Global Union Federation 

Related Documents

US State Department  [Publication date: 6/6/2014] 'International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers' Association (IUF) and Mondelez International for Operations in Pakistan'
   http://www.state.gov/e/eb/oecd/usncp/links/rls/227284.htm [Date URL accessed: 16/9/2014]

US NCP  [Publication date: 6/6/2014] 'International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco, and Allied Workers' Association (IUF) and Mondelez International for Operations in Pakistan'
   https://www.state.gov/documents/organization/227494.pdf [Date URL accessed: 25/7/2017]

TUAC Analysis

Did the NCP publish its initial assessment? status-icon
Did the case involve parallel proceedings? status-icon
Was the existence of parallel proceedings an obstacle to the NCP accepting the case? status-icon
Was the businsess relationship other than that of a subsidiary? status-icon
Was the nature of the business relationship an obstacle to the NCP accepting the case? status-icon
Did the NCP inform other relevant government departments about its acceptance of this case? status-icon
Did the NCP offer mediation or conciliation? status-icon
Did the company accept the offer of mediation or conciliation? status-icon
Did the complainant(s) accept the offer of mediation or conciliation? status-icon
Was mediation or conciliation held? status-icon
Was mediation or conciliation conducted by a professional mediator? status-icon
Did the parties reach agreement? status-icon
If yes, did the NCP publish this agreement following the consent of the parties? status-icon
If mediation was refused or failed did the NCP make an assessment of whether the company had breached the Guidelines? status-icon
Did the NCP conduct in-host country fact finding? status-icon
Did the NCP make recommendations to the company on the future implementation of the Guidelines? status-icon
Did the NCP publish its final statement or report? status-icon
Did the NCP provide for follow-up of the agreement/recommendations? status-icon
Did the NCP inform other relevant government departments about its final statement or report? status-icon
Did the NCP inform public pension funds about its final statement or report? status-icon
Did the NCP apply any consequences in this case? status-icon
Did the NCP follow the indicative timescales set out in the procedural guidance? status-icon
Was there a positive outcome for the workers involved in this case? status-icon
Did the filing of the case under the Guidelines have a positive impact for the workers involved? status-icon
Did the lead NCP play a positive role? status-icon
If different, did the home NCP play a positive role? status-icon