Tuesday, March 13, 2007

EU Causing Social Dumping?

Outsourcing has been a pressing issue for countries all over the world. According to Dimitrios M. Mihail, a professor of Business Administration at the University of Macedonia, a lot of outsourcing is causing social dumping. For example many apparel businesses in Northern Greece are moving their companies to Bulgaria where they can rehire their previous Greek workers. These Greek workers are the same workers that the companies previous had to laid off in order to move the company to Bulgaria. Once the workers are hired in Bulgaria are humiliated by the wages and working conditions. Mihail argues in his article "Globalisation and Corporate Codes of Labor Conduct in the EU" that the EU and its labor restrictions are causing companies to find ways to cheat this system by going to non EU countries to run their businesses. As a result or the outsourcing, the workers are the ones who ultimately lose the most. In this article Mihail gives a lot of suggestions to stop this, but at the end of his suggestions he counterargues them and leaves the reader not knowing what anyone should do. A few suggestions he makes are that the WTO or another global organization make labor laws for all countries. He then says that this may be too idealistic and that perhaps individual companies should just want to have high labor standards and governments could encourage the consumption of goods from those countries. Mihail goes on to say that this may not work because we can not leave something as pertinent as labor rights to a few companies that decide to do the right thing. By the end of the article after feeling quite exasperated by this whole issue Mihail finally enlightens the reader; he states that perhaps we should leave this issue to the laborers themselves and let them create unions that will hold the companies to these standards. After reading the whole article I decided that in the end I am not sure what can be done, but this is a pressing issue that is in dire need for a solution because social dumping is going to continue to occur without it.