Redress for Transnational Business-Related Human Rights Abuses in the UK

by may miller-dawkins, Dr Shelley Marshall and Dr Kate MacdoNald

This report contributes to ongoing debates about how the United Kingdom can best fulfil its obligations to enable people affected by human rights failures of UK companies abroad to access remedy, with a particular focus on the distinctive role of non-judicial redress systems. The report asks: what effects do transnational non-judicial mechanisms have? Under what conditions do they contribute to human rights remedy? And how can the design and operation of non-judicial redress mechanisms be improved?

In some respects the United Kingdom has shown leadership in establishing principles and processes to protect the human rights of people affected by the overseas operations of UK businesses, in keeping with the United Nations Guiding Principles on Business and Human Rights. The UK has led the way internationally in the creation and revision of a National Action Plan for Business and Human Rights. The UK’s National Contact Point has received the most complaints of any OECD National Contact Point globally. Multi-stakeholder initiatives such as the Ethical Trading Initiative have been established in the UK and attempted to forge collaborative responses involving companies, civil society and labour unions. There are also a small number of cases in which people impacted by the actions of UK companies have successfully brought civil suits in the UK and received compensation. Despite these initiatives spanning administrative, judicial and non-judicial processes, successive reviews have found that remedy remains rare and inaccessible to those harmed by UK companies operating overseas.
The report makes a number of recommendations concerning ways that the UK can improve its business and human rights standing.

An executive summary of the report can be read below. 

Executive Summary

Around the world, peoples’ lives are affected by the actions of businesses. In addition to positive impacts on livelihoods, ideas or technologies, business activity is also sometimes associated with significant human rights abuses, for example through land dispossession and forced resettlement, exploitation of workers, environmental damage or harm to people’s health. Access to remedy for these abuses is frequently impeded by failures of domestic legal systems, limited options in terms of redress mechanisms, significant structural imbalances of power between corporations and local communities, and distance — geographic, cultural, bureaucratic, political and economic – from decision-makers and established redress mechanisms.

This report contributes to ongoing debates about how the United Kingdom can best fulfil its obligations to enable people affected by human rights failures of UK companies abroad to access remedy, with a particular focus on the distinctive role of non-judicial redress systems. The report asks: what effects do transnational non-judicial mechanisms have? Under what conditions do they contribute to human rights remedy? And how can the design and operation of non-judicial redress mechanisms be improved?

Analysis of these questions draws on empirical research carried out over a period of five years into communities and workers pursuing remedy from grievances in garment and footwear, mining, industrial and agribusiness sectors in India and Indonesia. In the case studies we examined, workers and communities sought justice using a variety of strategies including organising and protesting, transnational campaigning, court cases, negotiation and making complaints to non-judicial mechanisms at the national and transnational level. This research paints a rich picture of the complexity, difficulty and often limited success of communities and workers seeking remedy or justice for human rights abuses through non-judicial as well as formal redress channels, leading to a number of key findings.

Key findings

1. The UK must do more to improve access to remedy if it wants to be an international leader on business and human rights

In some respects the United Kingdom has shown leadership in establishing principles and processes to protect the human rights of people affected by the overseas operations of UK businesses, in keeping with the United Nations Guiding Principles on Business and Human Rights. The UK has led the way internationally in the creation and revision of a National Action Plan for Business and Human Rights. The UK’s National Contact Point has received the most complaints of any OECD National Contact Point globally. Multi-stakeholder initiatives such as the Ethical Trading Initiative have been established in the UK and attempted to forge collaborative responses involving companies, civil society and labour unions. There are also a small number of cases in which people impacted by the actions of UK companies have successfully brought civil suits in the UK and received compensation. Despite these initiatives spanning administrative, judicial and non-judicial processes, successive reviews have found that remedy remains rare and inaccessible to those harmed by UK companies operating overseas.

2. Non-judicial redress mechanisms have serious limitations and cannot substitute formal justice systems

Non-judicial redress mechanisms are a key feature of the UK’s ecosystem of human rights redress, however the capacity of non-judicial mechanisms to deliver redress is very limited. Non-judicial mechanisms cannot mandate the halting of projects which are causing human rights injury. In most cases, they cannot produce compliance with negotiated agreements, nor provide remedies that repair harm to health, the environment or communities. They can even be damaging to long-term progress concerning access to remedy if they are used to delay or displace firmer political interventions to strengthen judicial avenues for access to remedy.

3. Despite their limitations, non-judicial redress mechanisms have the potential to complement formal justice systems

Non-judicial redress mechanisms have the potential to play a distinctive role in complementing formal justice systems and regulatory frameworks — providing alternative paths to resolving a dispute that may be less time and resource-intensive than a court system, and offering an option in cases where it is practically impossible to use the formal justice system effectively (either within host or home country contexts).

Although non-judicial mechanisms cannot substitute for provision of effective, legally-binding mechanisms, non-judicial mechanisms have the potential to complement the formal authority of government by using different kinds of leverage to generate new commitments and changes by companies. For example, they can potentially help to build pressure and support to businesses to create change within transnational supply chains, produce mediated agreements or drive change in policy in financial institutions. Moreover, their evidence and determinations can carry normative force that can influence the thinking and actions of others, including governments and investors. At their best, non-judicial mechanisms may help to build new relationships, to problem solve in a timely way, provide limited compensation, or influence the actions of other actors through producing evidence and determinations. We recommend that greater investigation occur into the ways that non-judicial and formal justice systems can be combined to strengthen each other.

4. Non-judicial redress mechanisms sometimes provide a positive result, but fall consistently short of delivering remedy.

Across the cases we examined, the non-judicial redress mechanisms fell short of delivering individual remedy both procedurally and substantively, although in around half of the cases we investigated there was some form of positive result from the perspective of claimants, for example through provision of access to compensation or a venue in which to mediate a settlement. Beyond the results of formal mediations or settlements, there was also some evidence that the relationships, evidence, public exposure or experience gained in a non-judicial redress mechanism process could sometimes contribute to other kinds of positive effects, including building power in communities or worker’s groups, influencing other decision-makers or changing policy, drawing public attention to a problem or shifting power dynamics between companies and communities or workers.

5. Those making claims face significant barriers to accessing and using procedures

Yet in all these cases, people continued to face significant barriers to accessing and using relevant procedures, and the results of mediation or other non-judicial processes largely failed to meet the standard of ‘relief needed to repair the harm’. Moreover, in many cases, engaging with non-judicial redress mechanisms also had some negative effects: reinforcing existing power dynamics and further disenfranchising workers or communities, entrenching existing business positions and practices (for example, allowing a project to go ahead), leading to perverse responses (for example, withdrawal of orders rather than helping a supplier fix a problem) or taking significant resources and time away from other organising strategies. For individuals involved in seeking redress, there were often significant costs, not only in terms of financial cost and time, but also the capacity to sustain action in the face of significant hurdles, hardship and in some cases harassment.

6. Persistent support from NGOs or unions increases the power of aggrieved communities and reduces barriers to redress, resulting in better results

The effects of non-judicial redress mechanisms are often strongest when they interact positively with the work of other actors — such as the sustained campaigning of workers and communities, the decision-making of investors or the determinations of governments.

Shifting power dynamics even slightly can contribute to improved outcomes for communities. However, these kinds of effects are, by their nature, highly contingent and rely critically on sustained and difficult work by communities and their NGO or union allies. 

These findings provide the foundation for a number of recommendations for reform of non-judicial mechanisms and ways that they can be better resourced and achieve greater leverage. 

Proposals for reforms

7. Reforms to strengthen non-judicial mechanisms

There are a range of factors that enable or constrain non-judicial mechanisms in delivering remedy or producing systemic change in particular sectors and contexts. The United Nations Guiding Principles on Business and Human Rights articulated one set of ‘effectiveness criteria’ for non-judicial mechanisms: that they be Legitimate, Accessible, Predictable, Equitable, Transparent, Rights-compatible and a Source of Continuous Learning. While not undermining the importance of these factors, this research finds that you can fulfil the UNGP effectiveness criteria in a formal way and still fall far short of delivering effective redress or remedy for business harms. We identify six critical additional factors that contribute to enhancing the effectiveness of non-judicial redress mechanisms including:

•        Approaches to redress power imbalance: an ability to balance where impartiality is required and where the purpose of the mechanism requires specific effects to redress existing power imbalances;

•        Processes for gathering and verifying evidence: clear approaches to generating or using evidence to inform actions and determinations;

•        Local level engagement: effective non-judicial mechanisms operate effectively between and across local, national and global levels, including with the help of trusted intermediaries.

•        Strategic Relationship Management: skilled staff who are able to broker, maintain and manage a wide set of relationships with political nous and sensitivity;

•        Leverage: strong bases and mechanisms for generating change in behaviour in targets;

•        Resourcing: commitment, skilled staffing, financial and other resourcing is a necessary but not a sufficient condition for effectiveness.

8. Efforts to redress power imbalances are vital

The importance of non-judicial redress mechanisms contributing to redressing power imbalances between affected people and companies is an important theme that runs throughout our analysis. This has important implications for the design of rules and procedures used by the non-judicial mechanism in managing disputes. For example, this implies a need to provide far more assistance to affected people who suffer a grievance to make a complaint, such as through direct provision of targeted capacity building for marginalised communities, accommodation of third-party organisations such as NGOs or trade unions working alongside communities to assist them, and provision of active community or worker outreach processes to support knowledge of and access to available redress channels. In some cases attentiveness to power imbalances may also entail support for evidence-gathering of a kind that reflects the divergent views of competing parties, in addition to independent investigation or evidence carried out directly by the grievance body. In all of these tasks, there is a need to balance where impartiality is required, and where differentiated strategies are required to ensure a fair balance of power between parties involved in the redress process.

9. Build relationships with human rights organisations in countries in which grievances occur

Another central theme emerging from this analysis is the importance of non-judicial redress mechanisms building strong working relationships with human rights organisations in countries in which grievances occur. Effective non-judicial mechanisms operate effectively between and across local, national and global levels, drawing on the assistance of trusted intermediaries, enabling them to have an impact closer to where human rights violations occur. This has implications for their location and resourcing, as well as the need for staff with skills in brokering, maintaining and managing a wide set of cross-sectoral and cross-jurisdictional relationships with political nous and sensitivity. Such relationships are also required to support ongoing efforts to strengthen implementation of any agreed remedies.

10. Build points of leverage to bring about long term changes in business behaviour

A further overarching theme is the importance of non-judicial redress mechanisms establishing a strong foundation for their own leverage over the UK companies and other parties involved in the problematic human rights practices. This entails establishing strong bases and mechanisms for generating change in behaviour of targets, through the ability to alter incentives or establish other sources of authority recognised by these targets. Key sources of leverage we identify include those based on reputation, learning and dialogue, market-based incentives or hierarchical authority. Commitment, skilled staffing and financial and organisational resourcing are also important factors in establishing the influence and authority required to be effective in supporting remedy.

11. Changes in procedures, more resources and stronger leverage are required

To some extent, effectiveness in these dimensions can be directly improved through changes to the internal procedures, governance or ways of working of non-judicial redress mechanisms such as the ETI or UK NCP. However, factors related to resourcing and leverage in particular are heavily dependent also on the actions of other parts of the UK government, as well as businesses, NGOs, and their broader supporters, donors and stakeholders.

Accordingly, some of this report’s recommendations are directed specifically towards the design and operation of UK-based multi-stakeholder initiatives involved in grievance handling such as the UK National Contact point and the Ethical Trading Initiative. Further recommendations are directed to other parts of the UK government, in recognition of the importance of a whole of government approach to supporting access to remedy, as a means of ensuring that appropriate external resourcing and leverage for effective non-judicial grievance handling mechanisms can be provided and sustained. We also present recommendations to business and civil society engaged in developing or participating in non-judicial redress mechanisms.

Recommendations are outlined in greater detail at the end of this report.