Poverty Footprint Study on how the Coca Cola - Oxfam America

Role of unions
In both countries, unions have been weakening
for a number of years. In El Salvador, for example,
unions have a weak presence after decades of being
repressed and then being systematically disbanded.
In Zambia, unions are historically associated with
improving workplace conditions, wages and benefits.
However, labor unions have weakened since the
pinnacle of their political strength in the 1990s, with
the adoption of structural adjustment policies playing
a major role in their demise. The ILO Freedom of
Association and Protection of the Right to Organise
Convention (1948) provides workers with the legal
right to join and operate workers’ organizations
without government or employer interference. The
researchers found no evidence that the companies
were preventing such organization.
There are mixed levels of unionization in the formal
sector workplaces across the value chain in both
countries. At the El Angel mill, there is a good
track record of dialogue and cooperation between
the union and the mill management owners. Mill
employees report that unionization has led to notable
improvements in their working conditions through
collective contract negotiations.
The employees at the Central Izalco Mill are not
unionized and reported that workplace conditions are
generally satisfactory and that they do not require a
union to maintain conditions.
At SABMiller’s bottling plant in El Salvador,
employees are not unionized, and they report
mixed views on how necessary it is to have a union.
Some employees reported a concern that even if
a union existed, there may be lack of engagement
by management. Despite some reports that
56 Exploring the links between international business and poverty reduction
union members might face discrimination from
management, this view is not widely held, and
appears to stem from an incident in the late 1970s
when the plant was under different ownership in
which union members undertaking direct action
lost their jobs. Some employees advocated for a
more effective forum to engage with one stating
that the current anonymous employee engagement
mechanism does not work and that motions
presented in writing are not resolved.
In Zambia, the union present at Zambian Breweries
holds monthly meetings between union members and
management and overall appears to enjoy positive
relations. However, some employees interviewed
complained that the union was not particularly active.
One employee blamed management for the union’s
lack of effectiveness, claiming that “Management
perceives the union as a nuisance... the union is left
with just junior workers who cannot argue out issues
very well. The union is struggling to survive.” 57 This
is consistent with a national trend of reduced trade
union activity and influence. Another employee felt
that management unfairly restricted employees’
ability to pursue other sources of income, given the
company’s restrictions on employees selling
Coca-Cola products through independent businesses.
The complaint about this restriction, driven by the
desire to avoid conflict of interest, may imply there
is opportunity to strengthen dialogue between
employees and management.
While some grievance mechanisms are in place,
there is scope for these to be improved in order to
facilitate better communication. The establishment
of well-defined, transparent processes for workers to
share their views with management would strengthen
relations and help ensure that labor standards are
properly enforced, and some recommendations to
this end are detailed below.
Oxfam believes that where there is a lack of
robust industrial relations between workers
and management, there is limited scope for
dialogue or collective action to alter policies
and practices and to help ensure that labor
standards are properly enforced.