Promoting effective grievance mechanisms for workers in Serbia

Germany is a key trading partner for Serbia holding over 15 per cent of total export value. Today, approximately 3.000 companies operating in Serbia export to the German market. On 1 January 2023, the German Act on Corporate Due Diligence Obligations in Supply Chains (Supply Chain Act (SCA)) went came into force with the aim of holding companies accountable for their supply chain practices, ensuring they respect human rights, including labour rights. From 2024, the Act obligates companies with over 1,000 employees in Germany to ensure human rights due diligence along their entire supply chains. These companies must identify, assess, and prioritize the human rights risks in their supply chain, take measures to prevent or minimize violations of human rights in their supply chain, and establish a channel for complaints from workers in their supply chain and some third parties.

Companies in Serbia belonging to supply chains of German companies are now obligated to ensure their operations adhere to sustainable practices, including compliance with 11 internationally recognized human rights conventions, of which 9 are fundamental human rights instruments of the ILO.

Under the SCA, when a company in Serbia is part of a supply chain of a German company, the workers in the Serbian company have the right to file a complaint with the German company or the relevant German authority when they feel their rights are not being respected. This complaints mechanism   is a key element of the human rights due diligence procedures established by the Act. It is, however, generally considered more effective  when workers have the possibility of raising concerns internally within the company instead of having to reach out to third parties for redress. In this respect, enterprise level grievance mechanisms can serve as a vital first step through which workers can seek to address potential violations of their rights.  By introducing and maintaining effective grievance procedures, the employer can, on the one hand, demonstrate a commitment to ethical and fair practices, thus maintaining its competitiveness on the market. On the other hand, experience also shows that well-functioning enterprise-level grievance mechanisms can prevent costly and time-consuming escalation of labour disputes.

The ILO approach 

The ILO joined forces with GIZ in February 2023 to provide workers in enterprises in Serbia belonging to the supply chains of German companies with better access to grievance mechanisms through the project “Ensuring adequate access to grievance mechanisms for the workers in automotive, electrical, and textile industry in Serbia”. The ILO approach rests on three pillars:

Key achievements of the project

1. Creating evidence: a comprehensive diagnostic on formal and informal grievance mechanisms revealed that both the Labour Code and specific regulations in Serbia do not regulate grievance mechanisms. In practice, some individual employers have regulated these mechanisms through their internal regulations, though many have not. 
2. Developing tools: a Manual on grievance mechanisms along with an Equality Code made in cooperation with the Commissioner for Protection of Equality was developedproviding practical assistance in the introduction of internal grievance mechanisms to both workers and employers and to promote antidiscrimination measures. The Manual is currently being updated to reflect the latest developments in due diligence legislation and practice. 
3. Building the capacity of stakeholders: compliance officers in Serbian companies and many workers who are part of supply chains of German companies were trained to improve awareness on the impact of the new requirements coming from the adoption of Supply Chain Act. Through the workshops with trade unions and the private sector in Serbia, the project has contributed to the introduction of effective internal grievance mechanisms and awareness raising among workers and employers on human rights due diligence process. 

When grievance mechanisms do not lead to a resolution of the issue raised, other dispute resolution avenues should be available. In Serbia, the Republic Agency for Amicable Settlement of Labour Disputes provides an opportunity for the parties to a labour dispute to seek mediation. The project has equipped the Agency with tools and knowledge to enhance its services, resulting in an increase of 59 percent of cases.

What is next? 

In its second phase, which will run until March 2025,  the project will expand its interventions to several other branches of the Serbian economy in which the supply chains of EU companies are present, in order to ensure better improved access to effective grievance mechanisms for more workers in Serbia. This will, thereby contribute to overall improving working conditions overall.