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RA N D E L K . J O H N S O N S E N I O R V I C E P R E S I D E N T L A B O R , I M M I G R A T I O N & E M P L O Y E E

B E N E F I T S M I C H A E L J . E A S T M A N E X E C U T I V E D I R E C T O R L A B O R L A W P O L I C Y

December 3, 2010

Susan L. Kurland Assistant Secretary for Aviation and International Affairs Department of Transportation Washington, DC 20590 RE: DOT-OST-2010-0074; Federal Aviation Advisory Committee; Comments on Suggestions Related to International Labor Standards
Dear Ms. Kurland:It has come to our attention that the during the meetings of the Labor and Worldclass Workforce Subcommittee that suggestions have been made that the Administration seek to include reference to various international labor standards in any Open Skies agreement entered into by the United States. In addition, it is our understanding that the suggestion was also made that the Department of Transportation require parties to any international joint venture, as a condition of antitrust immunity, to enter into a framework agreement with “the relevant” global union federation that commits the parties to adherence to various international labor standards. The purpose of this letter is to urge you to reject these suggestions. The U.S. Chamber of Commerce (Chamber) is the world’s largest business federation representing the interests of more than three million businesses and organizations of every size, sector, and region. Among our members are multinational companies as well as small businesses active in the aviation industry. Our membership also includes trade associations that, in turn, represent many more such employers. As we have only recently learned of this initiative, the purpose of this letter is not to offer a comprehensive response to your proposal, but instead to highlight some of the more important reasons why you should reject these suggestions.P a g e | 2

International Labor Standards There are eight Conventions of the International Labor Organization that are deemed to constitute the “Core Labor Standards.” These conventions cover four areas of labor and employment law: (1) Freedom of association and the right to collectively bargain (Conventions 87 and 98); (2) Elimination of forced labor (Conventions 29 and 105); (3) Abolition of child labor (Conventions 138 and 182); and (4) Nondiscrimination in employment (Conventions 100 and 111). The United States has ratified two of these Conventions, the 1957 Abolition of Forced Labor Convention, No. 105, and the 1999 Convention of the Worst Forms of Child Labor, No. 182. A third Convention, the 1958 Convention on Discrimination (Employment and Occupation) has been pending before the Senate, with little action, for many years. The United States has not ratified any of the other Core Conventions. This is not because the U.S. disagrees with the fundamental principles behind any of these Conventions, but because ILO Conventions are detailed, legally binding treaties that often conflict with U.S. law. Perhaps the most significant conflict in the law is presented by Conventions 87 and 98 which cover the principles of freedom of association and the right to collectively bargain. For example, they present an inherent conflict with the Tenth Amendment of the U.S. Constitution which prohibits the Federal Government from regulating the internal affairs of the states. Second, Convention 87 would require U.S. law to permit supervisors and managers to have collective bargaining rights. The National Labor Relations Act does not grant collective bargaining rights to supervisors, and in fact was amended by Congress in the 1940’s to eliminate collective bargaining rights for supervisors because such a model proved to be an unworkable conflict of interest. There are many additional reasons why these conventions cannot be ratified by the United States.1 In addition, it is widely understood that one of the reasons the U.S. has not ratified Convention 29, the 1930 Forced Labor Convention, is because the U.S. permits prison labor that may be overseen by private individuals or companies. Likewise, it is widely understood that one of the reasons that the U.S. has not ratified Convention 138, the Minimum Age Convention, is that the U.S. permits children to work in family farms in some

1 See, Edward E. Potter, Freedom of Association, The Right to Organize and Collective Bargaining – The Impact on U.S. Laws and Practices of Ratification of ILO Conventions, No. 87 and 98 (1984).P a g e | 3

circumstances, and, for the small percentage of businesses not covered by federal law, state law protections on this subject diverge widely. ILO Conventions Should Not Be Ratified Through the Back Door Concurrent with the U.S. ratification of the ILO Treaty on Tripartite Consultations, No. 144, the U.S. adopted a set of ground rules for reviewing ILO Conventions. Those rules must be followed in every case in which ratification of an ILO Convention is considered. As summarized at a recent meeting of the President’s Committee on the ILO, these ground rules include the following:

 That each ILO Convention will be examined on its merits on a tripartite basis;

 That if there are any differences between the convention and Federal law and practice, these will be dealt with in the normal legislative process; and

 That there is no intention to change State law and practice by Federal action through ratification of ILO Conventions, and that the examination will include possible conflicts between Federal and State law that would be caused by such ratification.
In other words, before an ILO Convention will be sent to the Senate for ratification, it will be reviewed by a tripartite group consisting of representatives of the U.S. government, employers, and labor organizations. If the group concludes that the Convention differs from U.S. law, changes to those laws will be sought through the normal legislative process, rather than through ratification of the Convention on its own. The proposal before the Committee, as we understand it, would be for the government to seek to include ILO “Core Labor Standards” in future Open Skies agreements. To include ILO Conventions in any future Open Skies agreement, amounts to an attempt to bind the United States to such Conventions without their having been ratified in accordance with the proper procedures. Perhaps more disturbing, it would also be an affront to the tripartite process agreed to among employers, labor organizations, and the U.S. Government concurrent with ratification of Convention 144. We strongly disagree with any attempt to ratify or implement ILO Conventions other than through the agreed upon tripartite process.2

2 The merits of ratifying any particular ILO Convention are beyond the scope of these comments.P a g e | 4

Joint Venture Conditions It is our understanding that the suggestion was made that the Department of Transportation require parties to any international joint venture, as a condition of antitrust immunity, to enter into a framework agreement with “the relevant” global union federation that commits the parties to adherence to various international labor standards. It is unconscionable that this body would even consider a proposal that effectively requires an enterprise to enter into an agreement with a global labor union as a precondition to obtaining anti-trust immunity otherwise available to it under law. This suggestion should be rejected for a number of reasons. Framework Agreements While framework agreements can vary greatly, typically a framework agreement is a private contract between an employer and a global union federation that, among other things, spells out the relationship between an employer and the global union federation. They often outline an employer’s commitment to international labor standards. Many of these agreements also require an employer to give up certain rights with respect to union organizing, including the right to expression and opinion. In fact, it would appear that securing the relinquishment of such rights is a significant reason such agreements are promoted by organized labor.To require a party to enter into such an agreement as a condition of securing antitrust immunity poses several fundamental problems. First, it would force employers to enter into a private agreement. Such a requirement runs contrary to one of the fundamental pillars of U.S. law, which is the freedom to contract. Second, it would effectively give labor unions the ability to veto an employer’s anti-trust immunity if the employer were unwilling to accede to the union’s demands. Third, because such agreements often include relinquishment of certain statutory rights available to employers, making them a requirement of securing another statutory right poses an irreconcilable conflict of laws. Finally, such agreements give one union, or a group of unions, significant advantages over others when it comes to organizing the employer’s employees, and effectively amounts to the sanctioning by the government of preferential treatment for one labor union over others. Not only does this violate domestic labor relations law, but it runs contrary to the principles of international law as well. Both the National Labor Relations Act and the Railway Labor Act prohibit employer interference in such a way as to favor one union over another or over employee desire to remain non-union. The suggestion to mandate that employers enter into a contract with aP a g e | 5

union or union federation in order to seek antitrust exemption for joint ventures should be rejected. In addition to the concerns we have expressed about the legality of forcing employers to enter into framework agreements, we also have significant concern about the fact that that such agreements also mandate adherence by employers to certain ILO Conventions. Many of these framework agreements specifically reference ILO Conventions. These instruments are designed to apply to governments and not to employers. Indeed, there are many provisions of the Conventions that are simply irrelevant to private sector employment. If the proposal were adopted, it necessarily follows that a U.S. employer be at a disadvantage with respect to anti-trust treatment because it follows U.S. law which in certain key areas does not conform to ILO Conventions. Should airlines be denied rights available to them under antitrust protections because of the U.S. policy in this area? ILO Conventions Should Be Enforced By the ILO ILO Conventions are detailed and nuanced treaties that have been adopted through a unique tripartite process involving governments, worker representatives, and employer representatives. They are not reached by consensus, and some are quite controversial. However, the ILO has also adopted tripartite mechanisms to review compliance. Member states of the ILO are required to complete detailed reports each year with respect to Conventions that they have ratified. A committee of experts reviews these reports as well as other information and issues an annual report on the extent to which countries are fulfilling their obligations. The tripartite Committee on the Application of Standards reviews these reports along with an examination of cases alleging a country’s failure to comply with its obligations. The Committee issues its own report on these matters each year at the International Labor Conference. In addition, the ILO contains other supervisory machinery. For example, the ILO’s Governing Body has a tripartite Committee on Freedom of Association that considers complaints against any ILO member country. The ILO institutional supervisory mechanisms have evolved over time and are both complex and nuanced. To be sure, they are not perfect. However, stakeholders have experience operating within the ILO process and in addressing relevant issues and this process has proven to be the best mechanism for reviewing compliance with ILO Conventions. It would be highly inappropriate for another body to pass judgment on compliance with one particular ILO Convention or another. The proposal, as we understand it, would open the door for others to make judgments about compliance with ILO Conventions. We strongly object to any effort toP a g e | 6

attempt to force private employer compliance with international treaties to which they are not subject.

Conclusion For these reasons, we urge you to reject both of these suggestions. Thank you very much for your consideration of these concerns. If the Chamber may be of further assistance to you as you consider these important issues, please do not hesitate to contact us. Sincerely,

Randel K. Johnson Michael J. Eastman Senior Vice President Executive Director Labor, Immigration, and Employee Benefits Labor Law Policy