CNBC, September 2, 2010, Thursday

CNBC

September 2, 2010, Thursday

CNBC

Group Says Europe Firms Exploit US Labor Laws

Some of Europe’s leading companies have exploited weak US labor laws to adopt aggressive anti-union practices even while proclaiming their respect for workers’ rights in their home markets, says a report by a campaign group released on Thursday.

The study by Human Rights Watch accuses, among others, Germany’s Deutsche Telekom’s T-Mobile USA and Deutsche Post DHL, plus retailer Tesco [TSCO-LN 429.25 2.40 (+0.56%)] and security group G4S [GFS-LN 250.50 -0.80 (-0.32%)], both UK-based, of failing to live up to their principles in the US – allegations they deny.

“These companies proudly state their commitment to international labor standards but in practice they have taken steps to create a culture of fear about organizing in the US,” said Lance Compa, author of the report and a labor law professor at Cornell University.

Mr Compa said his inquiry showed the companies had used a range of methods, legal in the US but unusual in Europe, to discourage workers from forming unions, violating a key international standard of non-interference in union organizing.

Tactics included changing workers’ job classifications to deprive them of organizing rights, threatening to replace workers who wanted to strike and calling in the police in an attempt to intimidate workers who wanted to pick up union literature from union representatives in public areas.

In one case the report alleges T-Mobile, part of Deutsche Telekom, derailed a trade union effort in 2006 to organize a call center in Allentown, Pennsylvania in part by summoning workers to compulsory meetings that attacked unions.


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Deutsche Telekom said “our actions are absolutely correct and above board. As a company, we respect all rules and laws, even in the US. It’s baffling that we are being named in this context and firmly reject all the allegations.”

While many of incidents documented were specific rather than systemic in nature, the report noted that “shortcomings in US labor law create enormous temptation” for companies to fall short of their stated goals of respecting labor rights. Campaigners have long decried the discrepancy between the labor protections available in the US and Europe.

In a few cases HRW said that certain European companies had also engaged “in threats and forms of intimidation and coercion that violated US labor law”.

Earlier this year, the report said, an administrative law judge found that Tesco had violated US labor law by attempting to prevent workers at some stores of its Fresh & Easy subsidiary from talking at work about unions. Tesco said the “allegations are completely untrue. Our staff are free to join trade unions. In the case of the US... this report is a further example of misleading allegations being used to misrepresent our position”.

G4S said that incidents on the company in the report were historic and it had improved its relations with unions. Deutsche Post DHL said that it was appealing against the specific findings by US authorities and broadly had good relations with its unions.

Copyright 2010 The Financial Times Limited