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Δευτέρα 22 Ιουνίου 2015

Why we need a new agenda on living wages in global supply chains

A global trade system that relies on the systemic exploitation of workers is morally reprehensible and inherently unsustainable
 
Agricultural workers in Tanzania
Codes of conduct – even when followed up by audits – cannot change the underlying causes of low wages. Photograph: Claudia Janke/ETI
 

April 24 marked two years since more than 1,100 workers, mostly women, were crushed to death in a factory making clothes sold in high street stores.

On April 26, Burberry and Glaxo Smith Kline become accredited living wage employers. They bring the total of UK living wage employers up to 1,400.
But what has migration and building safety got to do with wages? The answer is power. Or rather lack of it.
When garment factory workers refused to re-enter the unsafe Rana Plaza building in 2013, they were forced back in by their supervisors. Imagine the response, then, if they were to ask for a wage rise. Most workers in the UK enjoy access to information about their rights, are free to join trade unions and are backed by a legal, regularly revised minimum wage level that’s not far from a living wage. By contrast, Bangladeshi factory workers have none of these, and so have little chance of aspiring to a living wage.
These are the stories that make the news. Many others don’t, like stories of workers trying to support their families on poverty wages, getting deeper into debt, having to choose between eating and buying medicines or educating their children, working multiple jobs or exhaustingly long hours without overtime premiums.
Many employers recognise that such abuses are unacceptable and have codes of conduct to address them. But codes of conduct – even when followed up by audits – cannot change the underlying causes of low wages. And in a world where almost every major company talks about sustainability, poverty wages are inherently unsustainable.
Some companies tried addressing the problem head on. Some attempted improving productivity and efficiency so that savings could go towards wages. Another tried a more radical approach, based on percentage of factory output. But these individual attempts were costly, hard to scale up and could not guarantee that gains were actually channeled into workers’ wages rather than their employers’ profits. They relied on the continued goodwill – and custom – of that particular brand and ultimately made very little difference to enough workers’ pay packets.
As the call for living wages grows ever louder, companies demand to know what exactly a living wage is. The lack of an agreed methodology for calculating it, coupled with the complexity of voluntarily increasing costs, has put most companies off taking action on wages. Those pursuing an ethical agenda have focused instead on less controversial problems such as health and safety. When the likes of the Asia Floor Wage or Fairtrade International provide a benchmark, companies balk at the resulting figure – sometimes many times more than the prevailing wage.
So the status quo remains – workers toil on surviving, just about, on poverty wages. The threat of production being disrupted by violent strikes is never far away. Neither is the risk of media exposés like the one on daughters of impoverished Assamese tea plantation workers being sold into slavery, or, more recently, migrant workers on Spanish horticulture farms allegedly being paid a pittance and suffering respiratory diseases from lack of protective equipment.
A global trade system that relies on the systemic exploitation of workers is not only inhumane and morally reprehensible, it is inherently unsustainable. That’s why the Ethical Trading Initiatives (ETIs) of the UK, Denmark and Norway feel that it is time for a new agenda. An agenda that focuses not on the Holy Grail of a living wage figure, not on companies acting like charities running piecemeal projects, but on the very systems that are keeping wages low in the first place. There’s no mystery to what workers need to live on. Just ask workers – where possible through their elected representatives, the trade unions. Freedom of association and collective bargaining that empower workers and employers to negotiate mutually realistic wages – this is the real Holy Grail.
But how are companies to cope with any resulting price increases? Well, the same way they cope with increases in any other cost – by finding efficiencies, reducing other costs, increasing consumer prices, and/or ‘redistributing value’ (or to put it bluntly, reducing the size of their own short-term profits). Of course, few companies would be tempted – or able – to do this alone.
But by collaborating with others, companies not only reduce their individual risk, they increase their leverage. The World Banana Forum and the Malawian tea wage initiative led by Oxfam and the Ethical Tea Partnership, are two more examples of groups of companies working collaboratively with trade unions, NGOs and government, at a sector wide level to tackle systemic wage setting issues. This is the new agenda that ETI, with our Danish and Norwegian counterparts, is proposing. We’ve just published a new briefing, Living wages in global supply chains: a new agenda for business, which explores this territory.
We don’t pretend to have all the answers, but we believe this new agenda should help raise the water level so that all boats rise. We believe that this approach has a greater chance of sustained success than what’s been tried so far. But it can only work – and last – if everyone involved works together, seeing workers not as a cost to be minimised but as a valuable resource to be invested in. And only if we all recognise that we are in this for the long-term.

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