Debt Crises, Economic Adjustment, and Labour Standards

Abstract

This chapter examines the relation between economic adjustments, on the one hand, and labour standards, on the other. Section I reviews how labour standard issues have been addressed in different economic adjustment programmes, often initiated at the behest of international financial institutions, or the institutions of what was formerly known as the ‘Troika’. Subsequently, Section II analyses the legal and practical implications thereof. It explains how several labour law reforms required by international financial institutions in the context of economic adjustment have, on a number of occasions, driven countries into violations of international human rights law and international labour law in particular. Section III goes on to examine the economic case of deregulatory labour law reforms in the context of economic adjustment. It shows that the empirical evidence for negative economic effects of labour law in general and in the context of financial and economic crises in particular is at best highly controversial and cannot justify the highly problematic social effects and breaches of international law these reforms have often entailed.