Overview of the NCP and Its Role
The OECD Guidelines for Multinational Enterprises (the Guidelines) are voluntary, non-binding recommendations for responsible business conduct in a global context. In the Guidelines, adhering national governments, of which there are currently fifty, provide guidance to multinational enterprises operating in or from their territories. Adhering governments have committed to a) encouraging their multinational enterprises to follow the Guidelines in their global operations, and b) appointing a National Contact Point (NCP) to assist parties in seeking a consensual resolution to issues that may arise under the Guidelines.
As a part of its function, the U.S. NCP can help to resolve issues related to implementation of the Guidelines arising from the business conduct of a multinational enterprise in specific instances. Generally, such issues are dealt with by the NCP of the country in which the issues have arisen. The U.S. NCP handles such issues in accordance with procedures described in the U.S. NCP Guide. Further background on the Specific Instance process and the procedures and policies of the U.S. NCP can be found at the website of the U.S. NCP.
This Final Statement concludes the Specific Instance submitted on October 30, 2018, by IndustriALL Global Union (IndustriALL) and Syndicat National Autonome des Travailleurs d’Electricité et de Gaz “Sonelgaz” (SNATEG) (collectively, the submitters). The Specific Instance alleged conduct inconsistent with the Guidelines related to the operations in Algeria of Boston-headquartered conglomerate General Electric Company (GE).
The U.S. NCP accepted the Specific Instance for further examination and offered mediation on the issues raised by the submitters. Both parties accepted the NCP’s offer of mediation. In-person mediation could not be held for more than two years because of the COVID-19 pandemic, but when it was held, the parties reached a confidential agreement that successfully resolved the Specific Instance.
- The U.S. NCP recommends that both parties continue to work together, maintaining and building on the positive relationship that they developed during mediation, to address the issues raised in the Specific Instance and other responsible business conduct-related issues.
- The U.S. NCP recommends that both parties engage in its follow-up to this Final Statement.
The Specific Instance, and Response
Both submitters are trade unions. IndustriALL is a global union federation that represents 50 million workers in 140 countries in the mining, energy, and manufacturing sectors. It represents a number of GE employees. SNATEG, an affiliate of IndustriALL, is an Algerian union that represents Sonelgaz workers.
The Algerian company Sonelgaz, short for Socièté Nationale de l’Electricité et du Gaz, is significant in this Specific Instance. Established in 1969, Sonelgaz is a state-owned utility that provides electricity and natural gas to the people of Algeria.
On October 30, 2018, the submitters submitted a Specific Instance to the U.S. NCP. GE submitted its initial response on February 18, 2019. The submitters responded on March 12, 2019, and GE provided a further response on March 22, 2019.
The submission alleged conduct by GE inconsistent with Chapters II (General Policies) and IV (Human Rights) of the Guidelines. The submitters asserted that Sonelgaz systematically violated its workers’ rights to freedom of association and collective bargaining, in that Sonelgaz allegedly harassed, threatened, fired, and otherwise disciplined SNATEG leaders and members for their union activity, making it impossible for the union to function effectively. The submitters provided significant detail on several alleged incidents, with citations to supporting documentation, including reports of International Labour Organization (ILO) bodies and quotations from alleged victims. The Guidelines are inapplicable to Sonelgaz; as noted above, Sonelgaz is an Algerian company operating in Algeria, and the government of Algeria is not an adherent to the Guidelines. The key argument of this submission is that GE, in the context of its significant business relationship with Sonelgaz, failed to meet its responsibilities under the Guidelines to conduct due diligence and to use leverage to prevent or mitigate adverse impacts.
GE submitted a considered response describing in detail GE’s commitment to respect human rights across its value chain through due diligence and stakeholder engagement—exemplified by regular engagement with trade unions, including IndustriALL. GE submitted that the U.S. NCP should decline to offer mediation because, it asserted: first, GE is not directly linked to any alleged harm, as there is no connection between GE’s power-related products or services and the labor-rights concerns raised by the submitters; second, a publicly announced mediation could undermine any leverage that GE might have to engage with its customer regarding the submitters’ concerns; and third, it would be contrary to the purposes of the Guidelines for the U.S. NCP to intervene in the Algerian government’s affairs, particularly while an ILO investigation is pending.
After thorough review of information provided by both parties, the U.S. NCP (a predecessor of the current NCP) made a determination that the issues raised by the submitters merited further examination. Therefore, on May 9, 2019, the U.S. NCP sent an Initial Assessment to the parties, stating its decision to accept the Specific Instance and offering mediation services to assist the parties in undertaking a dialogue to seek a mutually agreed resolution of the issues raised by the submitters.
Acceptance of the Specific Instance was in no way an acknowledgement of or determination on the merits of the issues raised by the submitters, but merely an offer to facilitate neutral, third-party mediation or conciliation to assist the parties in voluntarily, confidentially, and in good faith, reaching a cooperative resolution of their concerns.
The U.S. NCP made this decision based on the Guidelines, and in consideration of the OECD’s guidance on initial assessments. In particular, according to the Commentary on the Implementation Procedures, an initial assessment involves determining “whether the issue is bona fide and relevant to the implementation of the Guidelines,” taking into account the following criteria:
a. The identity of the party concerned and its interest in the matter
On the basis of their status as unions representing relevant employees, the U.S. NCP was satisfied that the submitters have an interest in the issues raised and can provide information about the Specific Instance.
b. Whether the issue is material and substantiated
The submitters provided information supporting their allegation. While the initial assessment involved no factual findings or determination on the merits of the allegations, the U.S. NCP viewed the issues raised as material and substantiated sufficiently for the purposes of its initial assessment.
c. Whether there seems to be a link between the enterprise’s activities and issues raised in the specific instance
This section of the analysis addressed three topics. First, it noted that “business relationships” and direct linkage, under the Guidelines, may occur with a state-owned entity as well as a privately-owned one, so Sonelgaz’s ownership by the Algerian government was not disqualifying. Second, the Assessment concluded that, while a business relationship does not necessarily establish direct linkage that would invoke the Guidelines’ recommendations for due diligence and the use of leverage, “there is a link” between GE and the complained-of actions, while noting that due diligence and the use of leverage may be adapted to particular circumstances. Third, the Assessment noted the value of meaningful stakeholder engagement.
d. The relevance of applicable law and procedures, including court rulings
The U.S. NCP recognized that some of the issues raised in this Specific Instance had also been raised before Algerian domestic courts. On the other hand, the Algerian court proceedings reportedly addressed questions of Algerian law, different from the issues regarding the OECD Guidelines and other international standards that were raised in this case.
The U.S. NCP was not aware of any applicable law or procedures that would weigh against offering mediation in this case, and was satisfied that an offer of mediation would not have any significant effect on processes that were underway.
e. How similar issues have been, or are being, treated in other domestic or international proceedings
The U.S. NCP noted the ILO complaint filed by SNATEG against the government of Algeria. The NCP noted that this Specific Instance addresses GE’s alleged non-adherence to the Guidelines in connection with alleged violations of workers’ fundamental rights by its business partner Sonelgaz and makes no claims regarding Algerian law, distinguishing it from the ILO complaint. The U.S. NCP did not view the ILO deliberations as affecting its offer of mediation.
f. Whether the consideration of the specific issue would contribute to the purposes and effectiveness of the Guidelines
The U.S. NCP considered that its mediation could play a positive role in assisting the parties in facilitating a dialogue on the issues raised in the Specific Instance and reaching a mutually acceptable solution. Consistent with the criteria in the U.S. NCP procedures for Specific Instances (as established in the Guidelines themselves), the NCP determined in the course of its initial assessment that the matters raised are bona fide, merit further consideration, and are relevant to the implementation of the Guidelines. The U.S. NCP viewed that offering its good offices could contribute to the purposes and the effectiveness of the Guidelines.
Following its discussion of these criteria, the Initial Assessment also discussed the leverage that an enterprise may have in its supply chain, including that the available leverage may vary depending on the specific situation.
Under U.S. NCP procedures, acceptance of the Specific Instance—including a finding that the issues raised by the submitters were bona fide—in no way indicates that the NCP considers the enterprise to have acted inconsistently with the Guidelines, but rather that the NCP considers it appropriate to facilitate a discussion between the parties of the issues raised. Similarly, an enterprise’s decision to participate in mediation, or any other aspect of the Specific Instance process, in no way implies any admission of conduct inconsistent with the Guidelines.
Following the Initial Assessment and discussions, both parties accepted the U.S. NCP’s offer of mediation. Further discussion of details and scheduling ensued. The mediation was planned for Washington on March 24-26, 2020, but the COVID-19 pandemic prevented mediation from occurring then. As both parties believed that it was important to hold the mediation in-person, rather than virtually, mediation took place April 21-22, 2022, in Philadelphia, under the auspices of the U.S. NCP and its professional mediation team from the Consensus Building Institute.
Over those two days, the parties successfully reached and concluded a confidential agreement that resolved the Specific Instance. While the OECD procedural guidance favors transparency, it also recognizes the countervailing principle that confidentiality may promote the purposes of the Guidelines in certain situations, specifically recognizing that NCPs should disclose information on the content of an agreement “only . . . insofar as the parties involved agree thereto.” As noted above, the parties’ agreement in this case is confidential.
Because the parties accepted its offer of mediation and the mediation has concluded, the U.S. NCP brings this Specific Instance to a close with this Final Statement.
There may be subsequent follow-up action, as discussed with the parties. While the U.S. NCP’s guidelines currently provide for the possibility of follow-up only “on an exceptional basis” and “entirely at the discretion of the U.S. NCP,” the U.S. NCP believes that in this case certain follow-up activities may advance the purposes of the Guidelines.
The U.S. NCP would like to thank the parties for their dedicated and constructive participation in the process at every stage. In the U.S. NCP’s view, GE and IndustriALL deserve nearly all credit for the success of the mediation. Reasons included that the representatives of both parties had authority to negotiate and decide, acted in good faith, listened openly to each other’s positions, and demonstrated flexibility within the parameters of their interests. The CBI mediators warrant recognition as well.
The U.S. NCP encourages the parties to continue to engage in dialogue on the issues raised, and stands ready to consider future requests from the parties.
David B. Sullivan
U.S. National Contact Point for the OECD Guidelines
U.S. Department of State
 OECD, OECD Guidelines for Multinational Enterprises: 2011 Edition (2011), available at http://www.oecd.org/daf/inv/mne/48004323.pdf .
 U.S. Department of State, “A Guide to the U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises,” https://www.state.gov/u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises/a-guide-to-the-u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises.
 U.S. Department of State, “U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises,” https://www.state.gov/u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises/.
 See, e.g., P.D. Olson, “A New $3 Billion Deal Will Help Algeria Take Its Power to the Next Level” (GE press release) (April 24, 2017), https://allafrica.com/stories/201704241022.html.
 OECD, Guide for National [Contact] Points on the Initial Assessment of Specific Instances (2019), https://mneguidelines.oecd.org/Guide-for-National-Contact-Points-on-the-Initial-Assessment-of-Specific-Instances.pdf.
 OECD, Commentary on the Implementation Procedures of the OECD Guidelines for Multinational Enterprises, paragraph 25, available in OECD Guidelines, supra note 1, at pp. 82-83.
 Commentary on the Implementation Procedures of the OECD Guidelines for Multinational Enterprises, para. 9, available in OECD Guidelines, supra note 1, at p.79; Procedural Guidance, I.C.3(b), available in OECD Guidelines, supra note 1, at p.73; see also OECD, Guide for National Contact Points on Confidentiality and Campaigning when handling Specific Instances (2019), https://mneguidelines.oecd.org/Guide-for-NCPs-on-Confidentiality-and-campaigning-when-handling-specific-instances.pdf .