Bill punishes the entire production chain for violations – 7/2/2023 – Training

A bill pending in the Chamber of Deputies extends responsibility for human rights violations to the entire production chain. PL 572/22, presented by Helder Salomão (PT-ES), wants to regulate business activities in the country with surveillance, prevention and repair mechanisms from the parent company to subcontractors.

Organizations must comply with all international and national standards that prohibit work in slave-like conditions, among other social and environmental obligations.

According to the project, companies must prepare a report every six months with a summary of actions to be implemented, assessment of related risks, prevention measures and compensation plan. The documents must be forwarded to bodies such as the Federal Public Prosecutor’s Office and the Federal Public Defender’s Office.

Liability for non-compliance ranges from fines, suspension of activities, prohibition of incentives and contracting with the public authorities, to dissolution of the company.

The text awaits an opinion from the Economic Development Commission and will pass through two more commissions before the Constitution and Justice and Citizenship Commission.

According to federal deputy Pedro Lupion (PP-PR), president of the Agricultural Parliamentary Front (FPA), the project imposes excessive and potentially harmful obligations on the business sector. “For example, creating a fund to pay for the basic needs of people affected by human rights violations could impose a disproportionate financial burden on companies,” he says.

Furthermore, says Lupion, the responsibility for inspecting the other members of the production chain should be attributed to the State, not to the companies. “The participation of the private sector to curb violations of rights is valid, but it should not be a legal obligation. The bill, by imposing inspection responsibility on companies, goes against the Brazilian legal system.”

The deputy says, however, that the FPA is in favor of the project, with reservations. “It should be in line with the rules that already exist in the country, avoiding duplication and overlapping. It is important to consider adequacy to constitutional principles and established rights, guaranteeing legal certainty and avoiding conflicts with other legislation in force.”

According to federal deputy Fernanda Melchionna (PSOL-RS), who also signs the document being discussed in the Chamber, “a legislation like this would have a strong preventive action to combat cases of work analogous to slavery, but also of indignity, violence, overexploitation , from environmental attacks”.

According to labor inspector Lucas Reis, who has a master’s degree in law from the Pontifical Catholic University of Paraná, “there are principles in international treaties and conventions in the Brazilian legal system, but there is still no specific law”.

In his view, if there were a duty of care law in Brazil, it would be easier to hold large companies accountable. “Today, companies hide behind outsourcing, they use it as an instrument to evade responsibility for the employment contract. They don’t always succeed, but sometimes they shield themselves.”

The project follows the suggestions presented to the International Treaty on Human Rights and Business, at the UN Human Rights Council.

Countries like France and Germany already have guidelines of this type. French law passed in 2017 determines the duty of due diligence of parent companies and contracting companies. Organizations in French territory with more than 5,000 employees or with headquarters abroad but operating in the country with more than 10,000 employees must implement inspection throughout the production chain.

The German law, in effect since the beginning of this year, determines that companies with headquarters or branches in the country and more than 3,000 employees comply with a series of monitoring procedures, including commercial relations with suppliers abroad.

According to Fernanda Melo, whose research in her master’s degree in law at UFMG (Federal University of Minas Gerais) addresses sustainability and slave labor in the production chain, surveillance laws must be understood “not just as a legal obligation, but as an opportunity for companies to demonstrate commitment to social responsibility and sustainability”.

For Lucas Reis, “if these large companies are in a position to control the quality of their products, they are also in a position to control the quality of working conditions. And if they are in a position to control the quality of products from raw materials, they are have the condition to exercise vigilance in labor relations since the extraction of the raw material”.