Labour Rights in Global Supply Chains

Abstract

Over the past three decades, globalisation has particularly manifested itself in the spread of global supply chains. Only recently, rising protectionism and trade wars between the United States and China, as well as the COVID-19 pandemic, have placed an unprecedented burden on the world economy and the globalisation process of supply chains. Already existing power asymmetries and poor working conditions of workers in global value chains of MNCs have become even more visible. Against this background, the questions arise as to what role sweatshops play in global value chains, how they should be evaluated from an economic and ethical perspective, and what measures can and should be taken to improve poor working conditions. We provide a brief overview of the labour rights frequently affected by the contracts between MNCs and their suppliers before discussing a number of examples for violations of these labour rights in global supply chains. We offer a definition for sweatshops and then continue to critically evaluate the pros and cons of sweatshop labour. Based on these insights, we briefly review opportunities at different levels and by different actors to regulate and improve working conditions in global supply chains.