Joanne Knight

April 29, 2009

Human Rights and Corporate Responsibility

The debate in the Australian Parliament over the Fair Work Bill, earlier this year, highlighted some important issues on corporate responsibility and human rights. Rachel Nicholson from Allen Arthur Robinson law firm argues that under the Victoria Charter of Human Rights and Responsibilities, in certain circumstances, businesses already have a responsibility to protect human rights. The continuing small business exemption from unfair dismissal violates the rights of these workers to a fair hearing. Despite any legal ambiguity, it seems the drive for a culture protecting human rights is gaining force and business needs to be prepared.

Under the WorkChoices legislation, some businesses have been a little too eager to abandon corporate responsibility and impinge on labour rights, working conditions and fair pay. Internationally, companies have invested massive resources and money into countries like Indonesia and Burma, turning a blind eye to gross human rights violations, including the use of child labour.

A growing body of evidence details human rights violations due to corporate activities in poor communities in developing countries. A study undertaken by the International Network for Economic, Social and Cultural Rights (ESCR-Net) in June 2008, found that in 159 cases from 66 countries, business enterprises have had significant negative impacts upon the enjoyment of all types of human rights, in different political systems, around the world and across industries. Professor John Ruggie, UN Special Representative of the Secretary-General on Business and Human Rights in 2006 found that the oil, gas and mining extraction sector were responsible for two-thirds of reported abuses. The damage caused to company image in the past has been severe and lingers on even when the company cleans up its act.

Rachel Nicholson from Allens Arthur Robinson law firm, at the Everyday People, Everyday Rights Human Rights Conference on March 17, argued that a national human rights charter may make it possible to pursue human rights violations committed offshore by subsidiaries and related entities of companies incorporated in Australia.

In its Submission to the Senate Inquiry into the Fair Work Bill 2008, the Australian Human Rights Commission raised concerns that the Bill fails to fully implement Australia’s international human rights obligations. The continuing exemption of small businesses from unfair dismissal procedures violates the rights of more than a third of the workforce (36%) to procedural fairness and a fair hearing. It recommended that employees of all small businesses be entitled to the same protections from unfair dismissal as all other employees. The WorkChoices legislation seriously eroded the labour rights of Australian workers and the current government is continuing these appalling practices.

However in a seeming contradictory move last year the government launched a consultation process on how best to promote and protect human rights. Sixty years after the Universal Declaration of Human Rights, Australia is the only modern democracy without a national charter of human rights. Rachel Nicholson argues that under the Victoria Charter of Human Rights and Responsibilities, in certain circumstances, businesses already have a responsibility to protect human rights.

Under the Charter, where a company wins a government tender or otherwise receives government funding, it may be acting as a ‘public authority’. It is unlawful for a public authority to act in a way that is inconsistent with human rights set out in the Act and it has an obligation to give proper consideration of the impact of any decision on the rights protected.

Councils, Government Ministers and public officials have an obligation to act consistently with and give proper consideration to human rights in relation to all acts, omissions and decisions of a public nature, including the granting of contracts, project approvals and licences and the reviewing of impact assessments. Thus businesses applying for contracts, projects and licences are likely to be required to take human rights into account in the development of their project and be able to demonstrate that they have done so.

Telstra has expressed a general interest in having better protection of human rights in Australia. In its submission to the federal government last year it called for a national charter of rights, similar to the charters introduced in Victoria and the ACT, based on the statutory model adopted in Britain in 1998. However Telstra’s manouvering around negotiating a new enterprise agreement since June last year does not suggest a great respect for employees’ rights to freedom of association.

Ben Schokman of the Human Rights Law Resource Centre asserts that there is a sound economic case for a human rights charter. ‘When you look at human rights violations, whenever you’ve got the violation of a human right, that’s essentially a real cut to any human potential, it’s a cut to the economic potential of their society.’

With the passage of the Fair Work Bill, the arrangements for unfair dismissal procedures still fail to apply to significant numbers of the Australian workforce. If a human rights charter is passed, it leaves corporations in doubt as to their legal position. In spite of any legal uncertainty, it seems the movement to protect human rights is gaining momentum and business needs to be in position to meet the challenge.

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