The topic of the UN PRI webinar of beginning of July was ‘Labour Standards in the US’. In this discussion a representative of an institutional investor and the author of this Human Rights Watch Report sketched the situation on Labour Standards in the US. This appears to be specific to the US but European companies adopt US Labour practices, or at least an US attitude towards employees, when opening subsidiaries.

The US law allows for a lot of freedom on how to treat your employees. This is sometimes translated as ‘a flexible labour market’ and the opposite is sometimes translated as ‘protection of the employee’. But there still is a law. And it appears that Wal-Mart managers consider the law as something that is only valid if you get caught, in other words they are not ‘law abiding citizens’.

If Wal-Mart is fined for $ 2 billion this might have a serious effect on the US economy. Wal-Mart will undoubtedly find itself in similar situations in other states. With a total net income of around $ 12 billion over the last 12 months this is a serious threat. If they start abiding the law it will have a significant impact on their performance.

Wal-Mart might be an example of serious misconduct, even within the US labour system. But the UN PRI is not only concerned with abiding by the local labour laws. The UN PRI refers to international treaties of the International Labour Organization (ILO.) They are clearly looking for the message. How can you address companies about misconduct if there is no misconduct?! But it does not stop this organization from addressing this issue.