Canada’s LCAs

In the context of globalization, there is a clash between two points of view in the debate surrounding the social dimension, and more specifically labour law. On the one hand, the aim to improve labour laws must be a priority as well as the object of special measures and policies to help achieve it. In this perspective, countries’ trade policies should therefore be subject to policies aimed at promoting workers’ rights. On the other hand, trade generates growth, which is a vehicle of progress for labour law. Like all other social objectives, the improvement of labour standards must therefore be dependent on the objective of economic growth and the opening-up of the economy to trade. The Canadian position is in line with the second paradigm.

In addition to Canada’s trade commitments concluded as a member of the WTO, Canada has signed a regional free trade agreement – NAFTA (1994) – as well as three bilateral free trade agreements (Israel and Chile, 1997 ; Costa Rica, 2002). None of these agreements deal directly with the issue of workers’ rights in their provisions. Instead, the issue is dealt with in side agreements, referred to as "labour cooperation agreements" (LCAs). With the exception of the FTA and the agreement with Israel, all free trade agreements ratified by Canada are accompanied by an LCA. None of these agreements allow the freedom of movement of workers on the other party’s territory.

Contrary to the American strategy, which integrates the "social clause" linked to labour standards in their free trade agreements since the promulgation of the Trade Act of 2002, the Canadian strategy consists in signing LCAs at the same time as free trade agreements. Although they set forth certain "fundamental" labour principles or rights, in the end, parties are only required to comply with national legislations in effect, without the existence of mechanisms for "upward" harmonization. Unlike the Déclaración sociolaboral of MERCOSUR member countries, no principles or common rights are actually integrated into Canadian LCAs. The latter are above all based on cooperation and not on sanction.

Note that three shifts in the Canadian LCA strategy have occurred since 1994. Firstly, with respect to the nature of the standards, there has been a shift from commitments aimed at ensuring that signatory countries "take account of" the "eleven labour principles" in their respective labour laws, towards a consideration of the "ILO’s basic workers’ rights". Secondly, there has been a shift from a dispute settlement mechanism (with moderate financial sanctions associated exclusively with a limited number of principles), towards "review procedures" (without financial sanctions). Thirdly, there has been a shift from a cooperation agreement which provides for a common institutional mechanism for the management and follow-up of the agreement, towards the integration of follow-up responsibilities into the respective national institutions.