Atlanta, April 7, 2009 By Kent McVay Director, International Labor Relations

1. GIRN Briefing on Contract Labor Issues Atlanta, April 7, 2009 By Kent McVay Director, International Labor Relations

2. Agenda • Global Perspective – Contract Labor (CL) • IUF – Coca-Cola Relationship and IUF’s CL Strategy • Recent CL Issue Examples – • China University Students • National Labor Committee • Strategy To Address the Issue • Other Recommendations and Thoughts

3. Contract Labor Context • Many legitimate uses of CL resources • Unions, NGOs, some governments are critical of employer practices related to use of CL • Critics have launched corporate campaigns against employer CL practices • Large multinational employers should expect increasing scrutiny of CL practices • Complex issue

4. Framing the Issue with Contract Labor • Different ways to frame the issue • High percentage of workforce made up of CL workers • Improper treatment of CL workers • Improper disguised employment relationship • Wage and benefits inequities between similarly situated permanent and CL workers • Global union federations have branded the phrase “precarious employment” to described all forms of irregular, non-permanent and indirect employment arrangements

5. Global Union Federation Activity • GUFs are essentially aligned in their view of perceived ills of CL • ICEM - Contract and Agency Labour Newsletter

6. Contract Labor – Labor/NGO Concerns • CL workers are in many cases harder to organize into unions • CL used to limit or reduce the permanent workforce • CL often perceived as tool to pressure workers not to unionized • More difficult for unions to deal with primary employer as opposed to several labor agencies • Some laws preclude CL workers from joining same union as regular workers • CL perceived as having a wage deflation effect • CL workers perceived to be more vulnerable to industrial accidents • CL perceived to be less likely to have unfettered freedom of association rights • Prevalence of CL disproportionately affects female workers, minority workers, younger workers and immigrant workers • Unions perceive CL as a threat to the social standards workers enjoy

7. Global Union and NGO Strategy to Fight CL 3-pronged strategy • Increased Labor Movement and public awareness of the perceived ills of CL • Create new labor standards regarding CL • Confront employers directly

8. Global Union / NGO Strategies • Increase public and Labor Movement awareness • Adopted “precarious employment” branding • Developed position papers and other campaign material • Produce catchy YouTube videos to frame the issue • Changed union bylaws to allow CL workers and permanent workers to belong to same union • Globally supported striking workers seeking permanent employment • Organized concerted labor movement campaigns

9. Global Union / NGO Strategies • Create new labor standards • October and December 2008 several GUFs lobby the ILO • EU Temporary Worker legislation • Peru • Chile • Belgium • Namibia • South Africa

10. Global Union / NGO Strategies • Confront employers directly regarding use of CL • Collective bargaining to restrict the use of CL • Corporate campaigns • Shareholder resolutions • Leveraging relationships with NGOs • Encouraging adversely affected CL workers to sue employers • Organized or supported striking CL workers seeking permanency

11. CL - International Labor Standards • There are no international standards defining what are acceptable levels of CL in a given workplace • ILO Recommendation 198 (Employment Relationship) • ILO Recommendation 188 (Private Employment Agencies) • ILO Convention 181 (Private Employment Agencies) • “Decent Work” as defined by the ILO: • is work that takes place under conditions of freedom, equity, security and dignity, in which rights are protected and adequate remuneration and social coverage is provided • Decent work has four pillars: employment, social protection, rights and social dialogue

12. International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) AFRICA – Johannesburg, South Africa LATIN AMERICA – Montevideo, Uruguay ASIA/PACIFIC – Sydney, Australia NORTH AMERICA – Geneva, Switzerland CARIBBEAN – Bridgetown, Barbados JAPAN – Tokyo, Japan EUROPE - Brussels, Belgium EASTERN EUROPE AND CENTRAL ASIA - Moscow, Russia • General Secretary: Ron Oswald based in Geneva, Switzerland • Regional Offices work with 336 Unions in 120 countries, • 336 unions representing 12 million members • 140,000 unionized Coca-Cola members • 14 staff around the world monitor Coca-Cola trademark workplaces, including 1 staff member who monitors the Coca-Cola system full-time Eight Regional Offices: 12

13. IUF Focus on Contract Labor

14. IUF Focus on Contract Labor • CL remains a strategic focus of the IUF • Launched limited campaigns against CL practices of some large multinational employers • Developed and distributed a treatise on fighting CL - “Fighting Job Destruction: IUF Manual on Outsourcing, Casualization and Contract Labour” • Requested that CL be a standing agenda item at the IUF-TCCC consultation meetings • Developed “charter of demands against job destruction” • Facilitated affiliate union dialog via web site forum

15. Another Recent Campaign Example • “High Tech Misery in China: The Dehumanization of Young Workers Producing Our Keyboards” February 2009 • Companies Targeted - Hewlett-Packard, Dell, Lenovo, Microsoft and IBM

16. Recent Campaign Example cont’d • Launched by the National Labor Committee – NGO based in the U.S. • Similar campaign launched by NLC against Kathy Lee Gifford and others in the mid-1990s • Brings attention abusive treatment of the workers of suppliers to a number of large multinational companies • Substandard working conditions; • Excessive hours of work and forced overtime; • Non-compliance with minimum wage laws • Primitive conditions in company dorms • Workers locked in dorms

17. How Are We Addressing CL Issues • Action • Global Workplace Rights Policy and Supplier Guiding Principle assessments • Workplace accountability team is developing checklists relating to the responsible use of CL • Engaging largest bottling partners to develop core CL use guiding principles • Early identification and expeditious resolution of ad hoc issues • CL is standing agenda item for IUF • Education / Awareness • Including CL in workplace rights issue management training • Increasing business system awareness of labor movement/NGO focus on CL

18. Other Thoughts and Recommendations • Centralize the procurement of CL within a single function to drive accountability for responsible practices • Conduct self-assessments of CL practices, develop and execute corrective actions plans where needed • Avoid using the phrase “precarious employment” as coined by GUFs when engaging with others on the subject • EWCs - Consider taking the position that decisions to engage CL are local and not of a transnational nature • Consider paying social benefits of CL workers directly and deducting such amounts from CL suppliers fees - ***Ensure that pursuant to local laws that such actions do not trigger joint and several liability

19. Classified - Internal use Farms Consumers Coca-Cola system Ensuring that workplace rights are respected throughout our business and to our supply chain...our value chain... “Farm to Table” Approach Customers Suppliers

20. Questions