Implementing Labor Standards in the Electronics Industry of Hungary: Interactions Across Public and Private Approaches

This article proposes a theoretical framework to analyze interactions across private and public governance approaches to implement labor standards in transnational production chains, and uses the empirical case of the electronics industry of Hungary to evaluate its explanatory power. Building on existing efforts, I emphasize the importance of considering the competences and the interests of the actors involved in alternative governance approaches - states, unions and corporations - to understand interactions in practice and shed light on the conditions and processes of improved compliance. The key argument is that implementation of labor standards in emerging economies is contingent on combining private and public approaches with complementary competences with respect to the legitimacy, commitment and capacity of regulatory governance. The complementary features, however, need to be activated through the strategic actions (and/or coordination) of regulatory actors to improve enforcement. The empirical relevance of this framework is evaluated through contextualized case studies of electronics facilities from Hungary. The electronics industry is the largest globally integrated manufacturing industry that has repeatedly been criticized for its poor labor practices. Hungary is the largest manufacturer of electronics in the Eastern Central European region and is of great significance in the global electronics industry. State regulation plays an essential role in legitimizing the enforcement efforts of non-state actors to push for improved labor standards for short-term employees but hinder similar improvements around disciplinary measures. The processes and extent of improvements around short-term employees than is greatly influenced by the implementation mechanisms of transnational corporations, with interesting distinctions between monitoring and stakeholder engagement oriented approaches.