There has been extensive discussion on the German Supply Chain Due Diligence Act (SCDDA) in Germany, before and after its adoption in June 2021. But how is the Act perceived in the Global South? Are workers aware of the law? Do trade unions perceive the Act as an opportunity to protect and organise workers along the supply chain?
To find answers to these questions, FES TUCC commissioned a research study of the automotive sector in South Africa, Kenya and Ghana in the second half of 2022, before the SCDDA came into force. Unsurprisingly, the research revealed that the Act was still largely unknown to workers and trade unions. Company representatives were unwilling to speak with the researchers and some interviewees from the consultancy sector withdrew their statements after the interview. There was much uncertainty and little information available, only months before the law was to come into force.
However, what did become evident during the research was the need for due diligence legislation. The researchers in all three countries received reports from workers about problems with regard to labour standards along the German automotive supply chain before the Act came into force. Even though most of the identified issues were in contravention of existing national laws, there was no remedy for the affected workers, either because they did not know what mechanisms they could use or because they feared that there would be negative consequences if they demanded their rights. How then will it be different with the global implementation of the SCDDA, taking into account the dramatic power imbalance between multinational companies and workers in the Global South?
It is the trade unions that will make a difference! Their close involvement, including that of works councils and shop stewards in Germany and in the respective countries, can ensure that the SCDDA will truly make a difference for workers and affected communities. Trade unions can monitor if the true experiences of workers are reflected in the company reports and if the stipulations of the law, for example, transparent and accessible complaint mechanisms, are available to all workers in the supply chain. In case of violations, it will be key for trade unions in the respective country, as well as in Germany, to cooperate to ensure that violations are remedied by the company or are taken to the necessary legal process to force the company to comply with the law. If trade unions network transnationally, they can use the SCDDA to help them build power to countervail multinational companies.
However, the law in its current state remains ambiguous regarding the role of workers’ representatives – both in the producing country as well as in Germany. Instead of clearly defining the rights of workers’ representatives under the SCDDA and obligating companies to involve them in the Act’s implementation, the possibilities for workers’ representatives to influence the process have to be inferred from other laws, such as the German Works Constitution Act. Furthermore, workers in Germany and in Sub-Sahara African production countries have reported a lack of knowledge about how the supply chain is structured. This knowledge is central to trade unions for networking and organising along the supply chain. In light of workers’ limited access to information, companies must prioritise enhancing transparency across their entire supply chains, including suppliers.
The European Union’s (EU) proposed Corporate Sustainability Due Diligence Directive (CSDDD) that is currently being negotiated between the EU Parliament, the Council of the European Union and the European Commission can do better! It presents the opportunity to improve national legislation regarding the role of trade unions, transparency of complaint mechanisms, protection of complainants, and the duty of companies to inform workers and the public, among others.
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Simon, Hendrik; Monaco, Lorenza
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The Trade Union Competence Centre (TUCC) is the FES’ trade union project for Sub-Saharan Africa based in Johannesburg, South Africa. It operates based on two closely linked strategic approaches. On the one hand, trade union power is being strengthened at global, regional and national level in order to develop and to advocate for socially and gender just solutions for today’s pressing socio-economic challenges. On the other hand, urgently required transformations within the union movement are being accompanied and supported. Only democratically legitimated and member-based trade unions are able to shape the tremendous transformation processes in Africa and globally in the interest of workers.
More about the TUCC.
The German Supply Chain Due Diligence Act (SCDDA) has come into force on January 1, 2023. It holds companies accountable for the conditions in their global supply chains in order to prevent violations of human and environmental rights. It applies to companies that are based in Germany and that have at least 3000 employees there. Based on the Act, the respective companies have to comply with specific due diligence obligations. Among others, they have to submit regular risk analysis of their business activities as well as of those of their direct suppliers. However, if there is a specific cause, the risk analysis has to be conducted along the complete supply chain. Based on the outcomes of analysis, companies are obliged to implement prevention mechanisms and to take remedial action. Furthermore, they have to establish complaint mechanisms. Violations can be sanctioned by a fine.