What does it take to join the OECD? And are Labour and Human Rights part of the package?

In principle, membership rests upon two pillars: democratic societies & market economies. In practice, it is much about a single one.

Liaison Committee Meeting with the TUAC, OECD December 2018

Becoming a member of the OECD does not boil down to signing its founding Convention. While it remains the foundation for membership, it is a text that dates back to 1961 — the cold war era, when “globalisation” and “sustainable development” were unknown concepts. Importantly, the OECD has developed a number of legal instruments since then. Today, no less than 248 OECD legal texts are in force (Decisions, Conventions, Declarations, Recommendations, etc.).

The broader definition

Beyond the technicalities of the OECD legal instruments, the fundamental conditions for membership have been addressed several times in the past. Overall, it is about a “readiness” and a “commitment” to adhere to essentially two fundamental requirements: (i) democratic societies committed to the rule of law and protection of human rights; and (ii) open, transparent and free-market economies. This two-pillar approach can be found in several Ministerial declarations:

• Following the fall of the Berlin Wall, the OECD asserted in 1990 “the basic values which are common to the OECD countries: pluralistic democracy, respect for human rights, and a competitive market economy”.
• In 2004, a “Strategy for Enlargement and Outreach” (a.k.a the Noburu report) sets out four criteria: like-mindedness (shared values), significant player (contributes to the advancement of the Organisation), mutual benefit (membership is mutually advantageous) and global considerations (regional balance of membership);
• In 2007, the Organisation’s mission was defined as “promoting peace, stability, prosperity and democratic values through sound economic policies and good governance” and the Ministerial “invited the Organisation to remain true to its founding vision and high standards”.
• In 2011, for its 50th anniversary, “OECD Members form a community of nations committed to the values of democracy based on the rule of law and human rights, and adherence to open and transparent market economy principles”. The “vision statement”, as it is called, further specifies that “(t)he Organisation’s essential mission is to promote stronger, cleaner, fairer economic growth and to raise employment and living standards. We rely on it to do so by identifying key economic, social and environmental policy challenges and designing policies to improve the well-being of people around the world”.

In practice

In practice however, the two-pillar approach very much rests upon a single one, the market and economy pillar, and the process itself has evolved over the years, becoming more complex and more stringent, including after accession.

In the 1990s, the enlargement focussed on the former eastern European communist countries — Czech Republic, Hungary, Poland and the Slovak Republic — as well as Mexico and South Korea. The conditions for accession were relatively few, and were definitely focussed on market aspects. Examination processes would last for a year or so, with a handful of OECD committees conducting a shorter review with just one or two rounds of discussion. Countries joining the OECD, but failing to implement OECD legal instruments, were taken at their word to redress the situation ex-post. No need for detailed action plans. Accordingly no real post-accession monitoring process took place, with the notable exception of South Korea and following TUAC’s action on labour rights as discussed below.

In 2007, the OECD changed dimension with new ambitions for enlargement. The Ministerial Council adopted a new framework for accession, invited five countries — Chile, Estonia, Israel, Russia and Slovenia to open negotiations — to become full OECD members and decided to strengthen cooperation with Brazil, China, India, Indonesia and South Africa through enhanced engagement programmes with a view to possible membership. The new “roadmaps” for accession involved across the board in-depth review of a candidate country’s legislation, policy and practices and for more stringent the post-accession process. That model still prevails today, although it was revised and improved in 2015 with better monitoring (including public disclosure of an annual summary of post-accession progress).

In 2017, the OECD added another layer, this time for “prospective members”, ie. countries to be selected in the “waiting list” for formal accession. This Framework for Consideration of Prospective Members” requires adherence to a dozen OECD instruments (on tax, competition, statistics, foreign investor protection, etc.) combined with general notions on rule of law and “values”. The documents lists a selection of OECD legal instruments, all of which are corporate or market-focussed — Declaration on International Investment, Global Forum on Exchange of Information and Transparency for Tax Purposes & Inclusive Framework on BEPS; Code of Liberalisation of Capital Movements; Recommendation on Good Statistical Practice; and Recommendation on Principles for Internet Policy Making. The only rule of law-related instrument mentioned is the Convention on Combating Bribery.

What about human rights and labour rights?

What is striking in the above list is the absence of instruments and norms related to the rule of law, public integrity and human rights (with the exception of the Bribery Convention). At face value, the OECD seems more concerned about the professionalism of statisticians and the protection of foreign investors than that of human rights activists. Human rights and labour rights are indeed seen as “values” and are not tied to specific texts and standards. A straight-forward explanation is that the OECD does not have such legal instruments in-house. The search function of the OECD database in fact does not include these topics. On labour rights and labour market institutions, there are in fact only three recommendations in force: Integrated Mental Health, Skills and Work Policy (2015), Ageing and Employment Policies (2015) and Gender Equality in Education, Employment and Entrepreneurship (2013). The most well-known OECD recommendations on collective bargaining and social dialogue are found in the Jobs Strategy, which is not a legal instrument as such, and is released under the sole responsibility of the OECD Secretary General. By comparison, the OECD has no less than 95 environment-related instruments (several of which, including chemicals and waste management are posing problems for many accession countries).

The issue of human rights, labour rights, democracy and independence of the judiciary in large part seems to be a blind spot for the OECD. When a country joins, it has to observe the OECD legal instruments, most of which are market-related. The assumption is that other international fora, the UN and the ILO, and regional bodies (such as the Council of Europe) can take care of these aspects. That sort of division of labour makes sense if, and only if, the OECD takes formally on board the UN and ILO instruments — not treating them as “values”.

That is precisely what the TUAC has advocated and for many years. In May 2008, the TUAC released a Position Paper on the Enlargement process fleshing out how the countries’ commitment to the “core values” — including the rule of law and human rights, respecting workers’ rights — should translate into concrete observance of ILO Core Labour Standards, ILO conventions and relevant UN texts. Since 2010, the issue of OECD membership has been addressed in every TUAC statement to the OECD Ministerial Council Meeting.

Three countries stand out in the TUAC’s effort to promote the rule of law labour and human rights in accession processes: South Korea, Israel and Colombia.

• South Korea joined the OECD in 1996 with a commitment to reform its labour law to bring it into line with the ILO standards. However, within two months the then government backtracked on its commitment and reduced rather than extended labour rights. In the light of this, a 10-year special monitoring process was implemented at the OECD Employment, Labour and Social Affairs Committee. It ended in 2006, without delivering fully on the initial commitments. TUAC has spared no efforts in the process. Letters were sent to the OECD Secretary General and the Korean authorities (including in 2003, and in 2008), field missions were held in 2014 and in 2016 , a TUAC report was released that year, Upholding Labour Rights in Korea in an OECD context, as well as a formal TUAC Resolution. Today, the current Government might have a more constructive approach, including regarding ratification, at last, of the ILO core conventions. Yet a gap remains between the highly successful economy of Korea, one of the most integrated in globalisation, and the fragility of the labour market, of social dialogue and of labour rights.
• Israel joined the OECD in 2010. The TUAC led a fact-finding mission in October 2009 on the working conditions and employment in both Israel and the occupied territories and delivered a submission to the OECD ELSAC Employment and Workers Rights in Israel and the West Bank on to help the OECD set the terms of the membership and the post-accession. Issues at the time included the geographical perimeter of Israel’s membership, whether coverage was limited to the 1967 borders as ruled by international law, or also included the settlements in the occupied territories.
• Colombia joined the OECD in 2020, after a long and painful accession process that started in 2013, and ended in 2018. It took another two years for the country to ratify membership. Like South Korea, the TUAC and the trade union movement at large spared no effort throughout the process to ensure an ambitious pre-accession programme on impunity, independence and efficiency of the judiciary, collective bargaining and enforcement of law. The statements, the submissions, the reports are many on tuac.org. In December 2019 TUAC adopted a resolution calling among others for a strong and robust “post-accession monitoring framework”.

The future of the OECD

Ahead of the 60th anniversary of the OECD, in December this year and next year, the TUAC issued key messages on “the future of the OECD” on 10 June last, including a call for the OECD to “Be uncompromising on democracy, rule of law, including human rights and labour rights as defined by the ILO, including mechanisms for member states to be held to account for OECD norms and values”. A week after, the ITUC released its annual country ranking “Global Rights Index” detailing the grim situation faced by workers across the world, with an upwards trend of restricting the rights to collective bargaining, the right to strike. Importantly, in an OECD context, several current members are singled out in the ITUC report: Colombia and Turkey are listed among the “10 worst countries for workers”, while Chile, Greece, South Korea, Mexico and the United States are also flagged as countries of serious concern.

As the OECD celebrates its 60th anniversary and reflects on the future of the Organisation and the need to reinforce multilateralism, now more than ever, the rule of law, human & labour rights need to be treated with substance. They are more than “values”, and have internationally recognised norms and instruments that need to be observed by current members and by accession countries.