A guest blog by Doug Miller, emeritus professor Worker Rights in Fashion, University of Northumbria
Hats off to Fair Wear Foundation for really doing the necessary groundwork (wage ladders/labour costing/living wage cost engineering/seeking clarification on the Anti-Trust-competition in respect of buyer collaboration). All this helps us get closer to mechanisms for eradicating poverty wages in the global apparel industry. We are I think now at the cusp of nailing the implementation questions when it come to a ‘living wage’. For me there are a number of key realisations in this debate.
Since poverty wages have been collectively caused by the impacts of a myriad of individual buyer driven purchasing practices, the issue requires a collective buyer response in each sourcing country. The Bangladesh Accord as well as the recent joint brand letter to the Cambodian government and GMAC in advance of the national minimum wage determination have shown that there is a will.
So what is the way?
In looking for a way a second big realisation is that unless buyers own their facilities and therefore are the employers, sourcing companies cannot pay a living wage (however defined) on their own… They can only cost the labour component of the manufacturing cost on the basis of a nationally agreed living wage figure.
What if we had a sectoral collective agreement not only establishing a living wage but also a labour minute value, based on a methodology agreed between manufacturers’ associations, trade unions (including relevant global unions) and international buyers sourcing from the country in question?
The inclusion of buyers as a third signatory would be an entirely appropriate recognition of international business rights and responsibilities in line with the UN’s ‘Protect-Respect-Remedy‘ framework for business and human rights, and signal in fact a return to the past practice of jobbers’ agreements..
The labour minute value would be calculated on the basis of a standard number of days per month, excluding overtime but including non-wage benefits. It would establish the factor by which the labour cost of any garment can be calculated against the agreed time estimated to complete a garment in question.
By signing up to such an agreement and costing their consignments accordingly, buyers would make transparent their commitment to a living wage.
Since in some countries the preconditions for sectoral bargaining are not yet in place, such jobbers’ agreements should also be possible with individual manufacturing companies/groups of companies as an interim measure.
It should be possible for like-minded MSIs to encourage their member companies who are serious about implementing a living wage to disclose their supplier locations in order to map production overlap in specific manufacturing groups, thereby determine critical buyer mass which will be crucial to bring suppliers to the bargaining table.
Since labour minute value is not a price agreement, regulating this should be exempt from competition/anti-trust reservations.