Synthesis
Report
National People’sTribunals on
LivingWage for
GarmentWorkers in ASIA
Asia FloorWage Alliance
International...
Synthesis
Report
National People’sTribunals on
LivingWage for
GarmentWorkers in ASIA
CONTENTS
Written by Susana Barria
In collaboration with Ashim Roy
On behalf of the Asia Floor Wage Alliance
We would like ...
The struggle for a Living Wage in the labour movement has seen new
developments in the last decade giving rise to voices d...
1. Global Value Chain Theory and Application to the Garment Industry
The advance of globalisation has led to increasing co...
II: Asia in the global garment industry
As mentioned earlier, the garment industry is a typical buyer-driven
GPN. Brands a...
represented more than 75% of Bangladesh’s total exports in 2012
(UNCTAD, 2014) and is the third largest non-oil and gas ex...
I. Dehumanising workers
There is a strong feeling of urgency that emanates from the testimonies and is likewise captured i...
This is supported by the recent study byWorkers’Rights Consor-
tium (WRC) in 15 leading garment exporting countries, which...
country’s poor health infrastructure and facilities that do not
readily provide assistance to workers in need of medical c...
and physical trauma they face; the de-
cision to resign is not in their hands and
they have no option.This was expressed
i...
In case 2, the worker and local union
leader at M &V International Manufactur-
ing Ltd Branch # 4, Cambodia, explains:
Wor...
While poverty wages are being paid, prominent brands in the garment industry are making massive
profits, even during and a...
I. Right to a minimum living wage
Taken together, the NPTs’ verdicts find overwhelming evidence of significant deficits in...
ciously termed as “poverty wages”.
The Tribunals invariably “accept that the Right to a Living Wage is
both a distinct hum...
the actual manufacture of the garments” (Indonesia NPT 2014: 24)
and are therefore the principal employers in the GPN. In ...
supplier has to commit to ensure implementation, which should be
supported by the State.
The AFW mechanism is based on the...
AFW emerged in context of the rapid relocation of garment produc-
tion to the South and the earlier gains of unionisation ...
AFWA (Asia Floor Wage Alliance) (2005), Towards an
Asian Floor Level Wage Campaign in the Garment Export
Sector, New Delhi...
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
National People's Tribunals on Living Wage for Garment Workers in Asia
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National People's Tribunals on Living Wage for Garment Workers in Asia

National People's Tribunals on Living Wage for Garment Workers in Asia Society for Labour and Development http://www.sldindia.org/
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Transcripts - National People's Tribunals on Living Wage for Garment Workers in Asia

  • 1. Synthesis Report National People’sTribunals on LivingWage for GarmentWorkers in ASIA Asia FloorWage Alliance International Secretariat, c/o Society for Labour and Development, C 23, Ist Floor (Back Side), Hauz Khas, New Delhi - 110016, 
India, E-mail: asiafloorwage@gmail.com
  • 2. Synthesis Report National People’sTribunals on LivingWage for GarmentWorkers in ASIA
  • 3. CONTENTS Written by Susana Barria In collaboration with Ashim Roy On behalf of the Asia Floor Wage Alliance We would like to especially thank the following people for contributions towards this Synthesis Report: Anannya Bhattacharjee, Carole Crabbe, Jeroen Merk,Anna McMullen, Matilda Nahabedian, Rakhi Sehgal,Vishnu Sharma, Lee Siew Hwa, May Wong, Irene Xavier Sincere thanks to all the above, and anyone else whom we may have inadvertently missed out. Edited and designed by Imazine Designs [www.i-imazine.com] I IV II V III Introduction Recommendations from theTribunals and Asia Floor Wage IV.1 Right to a Minimum Living Wage IV.I Need for Governance Mechanisms in Gobal Industries IV. III Feasibility of the Asia Floor Wage IV. IV Overcoming Constraints to Achieving a Living Wage Overview of the Garment Industry in Asia II.I GlobalValue Chain theory and Application to the Garment Industry II.II Asia in the Global Garment Industry Way Forward Key Issues in Garment Industry:Towards a Regional Perspective III.1 Dehumanising Workers III.II Trade Unions and Workers Rights III.III The Legal Framework Bibliography Annexure 1: Sri Lanka JuryVerdict Annexure 2: Cambodia JuryVerdict Annexure 3: India JuryVerdict Annexure 4: Indonesia JuryVerdict Annexure 5: Jury Members list with Biographies Annexure 6: List of petitioners for eachTribunal Annexure 7: List of people who gaveTestimonies and People’s Advocates © Asia Floor Wage Campaign 2014 All rights reserved.This publication is copyright, but may be reproduced by any method without fee for advocacy, campaigning and teaching purposes,
but not for resale.
  • 4. The struggle for a Living Wage in the labour movement has seen new developments in the last decade giving rise to voices demanding for a Regional Floor Wage in the garment sector of Asia also.The demand began taking shape in 2006 through a collective consensus building process among Asian labour organisations which led to the formulation of a methodology for the calculation and establishing of a cross-country floor for wages in the garment sector in the region known as Asia Floor Wage (AFW).The struggle entered a new phase after the public launch of AFW Campaign led by the Asia FloorWage Alliance (AFWA) on 7th October 2009, the World Day of Decent Work.This second phase of presentation of its demands included numerous meetings with brands, multi-stakeholders and international institutions providing ground for the gradual legitimisation of the AFW as a credible formulation for the floor level of a living wage (a minimum living wage) in the garment industry in Asia. As part of this process and in order to take the campaign forward, AFWA, in collaboration with the Permanent People’s Tribunal, organ- ised a series of National People’s Tribunals (NPTs) on Living Wage for Garment Workers in Asian Garment Industry between 2011 and 20141 . This process is moving towards a Synthesis Hearing on Decent Work and LivingWage in the Global Garment Industry to be organised in November, 2014 to capture the lessons and results of the NPTs and to articulate future steps towards the implementation of the AFW. The first NPT in the series, the Tribunal on Minimum Living Wage and Decent Working Conditions as Fundamental Human Rights, was organised in Colombo, Sri Lanka on 27-30 March, 2011.This was followed by the People’s Tribunal on Living Wage as a Fun- damental Right of Cambodian Garment Workers, organised in Phnom Penh, Cambodia on 5-8 February, 2012. After this, the Na- tional People’s Tribunal on Living Wage as a Fundamental Right of Indian Garment Workers was held in Bangalore on 22-25 Novem- ber 2012 as the culmination of the local hearings processes from two of the regions where most of the production takes place, the National Capital Region (NCR) around Delhi and Bangalore, in the State of Karnataka. Finally, the Indonesian People’sTribunal on Living Wage and Decent Working Conditions for Garment Workers as Fundamental Rights was held in Jakarta, Indonesia on 21-24 June, 2014. It’s worth noting that during each of the NPTs, the jury members in each concerned country were selected by local organisations organising theTribunal.The Permanent People’sTribunal had a seat on the jury in all the NPTs except the one in Sri Lanka. This report aims to give an overview of the key outcomes of the NPTs to the Panel of the Synthesis Hearing in Hong Kong. It is based on the background readings given to the juries of the NPTs, the testimonies presented at theTribunals, the verdicts of theTribu- nals and relevant literature, especially on the garment industry and international governance of global industries. Following this introductory section, section 2 gives an overview of theories of international governance of global industries and of the garment industry. It draws on the background readings provided to the jury, experts’ testimonies at the NPTs, as well as relevant com- plementary literature from scholars and civil society organisations. It aims to provide a broad framework to help locating the specific issues emerging from the proceedings of the NPTs. Key issues are developed in section 3. It is organised to allow for regional trends to emerge and to draw out the connections between them and the broader framework discussed in section 2.This section is most- ly based on the detailed testimonies made at the hearings by work- ers from the four countries in which the NPTs took place. Section 4 is mostly based on the verdicts of the NPTs and gives special attention to the recommendations made by the juries. It tries to bring the country-level recommendations of the NPTs and the AFW campaign proposals in convergence with one another. The final section,section 5,draws conclusions that,we hope,will enlight- en the way forward in the struggle for a living wage for garment workers in Asia and in the world.The Annexures give an overview of the materials presented during the NPTs. 1 The Permanent Peoples’ Tribunal is an international opinion tribunal independent from State authorities. It examines and provides judgements relative to violations of human rights and rights of peoples.The Tribunal was founded in Bologna (Italy) on June 24, 1979, by law experts, writers and other intellectuals. It succeeded the Russell Tribunal (or International War Crimes Tribunal), which, in 1967, exposed the war crimes committed against theVietnamese people.The Permanent Peoples’ Tribunal was created out of the Lelio Basso International Foundation for the Rights and Liberation of Peoples (FILB), established in 1976 and inspired by the Universal Declaration of the Rights of Peoples at Algiers (also named the Algiers Declaration). S ECTION - I Introduction a) take the NPT process from the national to the international level b) absorb the learnings from the Tribunals and recommend future steps for the implementation of a living wage c) consolidate engagement with the Global Union Federations (GUFs), especially in view of developing a ‘brand bargaining’ strategy, and d) contribute towards a roadmap to an International Hearing in 2015 The Synthesis Hearing, to be held on 17 November, 2014 in Hong Kong, aims to: Colombo, Sri Lanka 27th - 30th March 2011 Bangalore, India 22nd - 25th November 2012 Phnom Penh, Cambodia 5th - 8th February 2012 Jakarta, Indonesia 21st - 24th June 2014 National People’s Tribunals (NPTs) on Minimum Living Wage and Decent Working Conditions as Fundamental Human Rights were organised in the four highlighted countries 6
  • 5. 1. Global Value Chain Theory and Application to the Garment Industry The advance of globalisation has led to increasing complexity in pro- duction processes and company structures. In globalised industries, it is difficult to follow the production process of a commodity from the raw material to the end consumer. Global Production commonly in- volves several countries, as well as several companies related through various legal forms and tacit working relations. Some scholars have tak- en the task of identifying not only the patterns emerging from these new production networks, but also the mechanisms that allow them to function (Gereffi, Humphrey and Sturgeon, 2005; Barrientos, 2007; Blair, 2014).This includes the specific interests of the different actors of the networks and the relations of power between them that underpin an overall production system that sustains over a period of time.In addition, the differences in levels of development of the regions and countries where the nodes (points of contact between the different actors) of the network are located further inform these mechanisms (Gereffi and Memedovic, 2003). Global Production Network (GPN)2 theories have identified two kinds of networks, according to which the weight of the influence lies: with the producer of the commodity (called producer-driven network/industry), This section provides a framework to the Tribunals and draws on the rich expert testimonies as well as complementary literature from scholars and civil society organisations. Overview of the Garment Industry in Asia 2 Other nomenclatures of theories of internationalised production processes include Global Value Chains, GVC, or Global Commodity Chains, GCC. S ECTION - II INDIA | A local tailor or with the company trading the commodity from the manufacturing hub to the end market (called buyer-driven network/industry) (Gereffi 1994). We will examine the functioning of the buyer-driven industry as it is more applicable to the garment industry (Gereffi and Memedovic, 2003). There are four key actors in buyer-driven globalised production systems (Gereffi, Humphrey and Sturgeon, 2005).At the start of the process are the workers in the specific industry.They are mostly located in countries with comparatively low-wages which helps in keeping the cost of production at lower level.The second key actors are the manufacturing companies, also called‘suppliers.’Here due to sub-contracting,there are layers of companies involved in manufacturing at different stages of the production process. However, the companies that are seen as key in the articulation of the network are the Tier 1 companies (the top company that has the direct contractual relationship with the buyers or brands) in the country/region of production.The ‘buyers’ are the third key actors of the network.These are both retailers and brands that target the retail market predominantly in high-income countries.They typically do not have manufacturing facilities of their own. Finally, at the end of the process are the consumers, mostly located in developed countries where the average purchasing capacity is comparatively higher than in middle and low-income countries, thus pro- viding sizeable and reliable retail market.There are other major actors that can influence these networks, such as nation-state regulatory frameworks and regional/global trade and economic cooperation frameworks. Howev- er, they are not internal to the production process and as such they can be taken as playing the role of influencing it from the outside. Now, let us see the mechanisms which also have equally significant role in strengthening such a network.A precondition to globalised production was the opening up of industrial bases in low and middle income countries for export-oriented industrialisation that provided a terrain for the expansion of high income business houses (Gereffi and Memedovic, 2003).This en- abled the articulation of GPNs around low cost labour, which was essential- ly a workforce remunerated with poverty level wages. However, this work- force is not homogeneous. It has been argued that it is highly segmented geographically (due to the limitations attached with labour mobility) and its characteristics depend on the poverty level of the region and the coun- try where it is located (Bhattacharjee and Roy, 2012: 2).The neo-classical assumption believed that with the infusion of capital in export processing zones, productivity would grow and wages would adjust to this growth. But, 8
  • 6. II: Asia in the global garment industry As mentioned earlier, the garment industry is a typical buyer-driven GPN. Brands and retailers (also called brand-name retailers), most- ly from Europe or the United States of America (USA), control the consumer markets in high-income countries.They are the ‘buy- ers’ in the GPN. According to studies, they source from hundreds, up to thousands of suppliers, which are generally not disclosed, making it very difficult to establish links between consumers and producers (SOMO, 2012). However, brand-name retailers often place the majority of their orders with a relatively small number of key suppliers. For example, 20 per cent of contracted factories account for around 80 per cent of Nike’s total merchandise volume (Merk, 2012). There is a visible functional split between the role of the brand- name retailers and the suppliers or manufacturers that take up the labour-intensive or assembling aspects of production.The suppliers have become increasingly focused on producing either high-quality components or finished products, often for several (competing) brand-name retailers (Merk, 2012). In some of the literature (Hur- ley, 2005), they have been referred to asTier 1 manufacturers due to their direct supply relations with brand-name retailers. Some Tier 1 manufacturers have emerged asTNCs, but this is a tendency more than a dominant feature (Merk, 2012)4 . While the garment manufacturing is predominantly based in the developing world,Asia as a region tops apparel exports (UNCTAD, 2014). In 2013, as apparel trade amounted to 460.27 billion dollars, more than 60% of it originated from 10 Asian countries (seeTable 1 below).The share of Asian countries in apparel exports increased over the last ten years from around 50% in 2000 to close to 65% today. 5 Out of the top ten world garment exporters in 2013, seven were from Asia. In the region, China, Bangladesh, India, Sri Lanka, Indonesia and Cambodia have covered the bulk of garment pro- duction in the last decade. 6 It has been argued that the space for relocation of manufacturing firms is regional - within Asia - rather than global (Bhattacharjee and Roy, 2012). The rest of the chain is hard to track. Tier 1 manufacturers may distribute work to smaller production units or labour contractors, which,in turn,may subcontract this work out to home-based work- ers (Hurley,2005).All these production activities might also happen in the factory premises of the Tier 1 manufacturer through labour contracting, as shown in recent studies in India’s NCR (Srivastava, 2014). It has been argued that this supply chain has purposely been made opaque (Srivastava, 2014). As a consequence, the vast ma- jority of the garment workers across the world are employed by small, locally-owned enterprises, which enjoy very little or often no legal protections (Merk, 2012). On the other side, garment is a key sector in many countries in the region.The garment industry is a critical part of Cambodia’s econ- omy, accounting for more than 80% of the country’s total exports and around 16% of the country’s Gross Domestic Product in 2009 (Lowenstein, 2011). Similarly, in Sri Lanka, the contribution by the apparel sector to the economy was 46.2% of the total exports, with an income of $ 3,274.2 million in 2009. The industry also 3 Merk Jeroen, Clean Clothes Campaign, expert testimony, Sri Lanka NPT, March 2011. 4 Studies have documented the role of Asian capital in setting up tier 1 manufac- turing companies in Asia, as well as in other regions. For more literature on Asian-con- trolled garment multinationals, see De Haan andVan der Stichele 2007; Gibbon 2003;Wong,Van Grunsven and Smakman 2005;Yeung 2006 5 Data from WTO Statistical Program online, at http://stat.wto.org/Home/WSDB- Home.aspx?Language=. 6 Four of them, India, Sri Lanka, Indonesia and Cambodia, were covered by the National People’sTribunals process. 2000 2003 2008 2013 Total (in billion US$) 197.64 233.23 363.87 460.27 Share of Key Asian Countries China 18.25 22.32 33.09 38.55 Bangladesh 2.56 2.42 3.21 5.11 Hong Kong, China 12.25 9.93 7.67 4.77 Viet Nam 0.92 1.49 2.40 3.74 India 3.02 2.71 3.01 3.66 Indonesia 2.40 1.74 1.73 1.67 Cambodia 0.49 0.69 0.83 1.11 Malaysia 1.14 0.88 1.00 1.00 Pakistan 1.08 1.16 1.07 0.99 Sri Lanka 1.42 1.08 0.94 0.98 Share of top 10 Asians 43.54 44.41 54.95 61.57 Value of top 10 Asians 86.06 103.59 199.94 283.38 Table 1: World Garment Exports - Key Asian Countries Source:WorldTrade Organisation Statistics Data base http://stat.wto.org/Home/WSDB- Home.aspx?Language= the present trends emerging on a wide spectrum have proved it to be empirically wrong while things are in fact moving towards a reverse direction. In fact, productivity has increased and wage share has declined across the world as shown in the GlobalWage Report (2010-11) of International Labour Organisation (ILO), which notes “[the] short-term impacts of the [global financial] crisis should be looked at within the context of a long-term decline in the share of wages in GDP, a growing disconnection between long-term wage growth and productivity growth, as well as widespread and growing inequality” (ILO Global Wage Report, 2012: 79). There are several levels of competition operating within and along the chain also. On the side of high-income countries, buyers com- pete in the consumer market for a larger share of the market. On the side of low and middle-income countries, suppliers com- pete among themselves for contracts with buyers. But there is also competition between buyers and suppliers over the distribution of profits generated in the network. In his famous book Competitive Strategy, business expert Michael Porter writes,“having a low-cost production yields the firm above-average returns in the industry” (Porter, 1980: 35). In other words, buyers compete in high-income country markets on the basis of their capacity to access low-cost production areas. Following this understanding, business analyst Stephen Roach coined the term ‘global labour arbitrage’. In this context,‘arbitrage’ means creating profits by exploiting a difference in price of the same asset in different markets. In other words, a single product, through access to two different markets, creates the condition for profitability, unrelated to the cost of production itself. It can be argued that ‘low-cost production’ has come to be synonymous with low-wage workforce, and so the price difference is linked to the international wage hierarchy between high-income and low and middle-income countries.Thus,‘foreign labour content replaces domestic labour input’ (Roach, 2004). The final piece in the puzzle is the systems that keep suppliers’ access to high income countries’ markets closed (Gereffi and Memedovic, 2003). The implication of the global labour arbitrage system, in which brands and retailers dominate suppliers in the production network, is the disproportionate distribution of profits between suppliers and buyers.The price at which the commodities are exchanged be- tween the supplier and the buyer is the point, or the node, at which the disproportionate distribution of profits takes place (Bhattacha- rjee and Roy, 2012).This is at the point of transfer from location of production to location of consumption. Another aspect of the GPN is the shift in international trade from exchanges based on market relationships to one based on close- ly connected interlinked firms (Gereffi, Humphrey and Sturgeon, 2005).This is not the same model as that of trade exchanges be- tweenTrans-National Companies (TNCs) and their subsidiaries, as there is no formal ownership of the overseas firms, though pro- duction is, in fact, outsourced to them. This process of exchange expands and transforms intra-firm trade to new dimensions. The GPN is the expression of organisational linkages used by TNCs to reorganise production through contractual agreements and ser- vices.The World Investment Report 2013 released by United Na- tions Conference on Trade and Development (UNCTAD) states: “Today’s global economy is characterized by global value chains (GVCs), in which intermediate goods and services are traded in fragmented and internationally dispersed production processes. GVCs are typically coordinated by TNCs, with cross-border trade of inputs and outputs taking place within their networks of affiliates, contractual partners and arm’s-length suppliers.TNC-coordinated GVCs account for some 80 per cent of global trade” (UNCTAD 2013b:x). Thus the GPN is organised as a global sub-contracting production chain in which the buyer is the principal employer and the supplier a sub-contractor. However, the weight of the TNC in deciding the production pro- cess remains substantial. Buyers dominate as lead firms and retain the capacity to influence the articulation of the network: buyers choose their suppliers; they maintain domination on the retail mar- ket to which suppliers have no direct access; and through their capacity to create competition between suppliers, they set the production norms. It is important to foreground the employment relationship embedded in the commercial contract (Bhattacharjee and Roy,forthcoming 2015).Thus,relations along the GPN become ‘quasi-production’ relationships, which do not carry the burden of legal ownership and associated risks. 109
  • 7. represented more than 75% of Bangladesh’s total exports in 2012 (UNCTAD, 2014) and is the third largest non-oil and gas export revenue generator (after palm oil and rubber). The garment industry is also a key source of employment, repre- senting more than 30% of manufacturing employment in India in 2011-12, or close to 18 million jobs. It also should be noted that more than 40% of these workers are women (Srivastava, 2014a). Similarly, in Cambodia, the garment industry accounted for around 45% of all workers employed in manufacturing in 2009 (Lowen- stein, 2011). In Indonesia, the sector is estimated to employ about 3.1 million workers. However, labour markets in these countries are not homogeneous. More than 90% of the workers in the Cambodian garment industry are women, while men dominate the rest of the non-agricultural labour market. In Sri Lanka, women are said to be 78% of the gar- ment workforce. The majority of these women are young migrants from rural areas having low levels of education. Being poverty rid- den, struggling to earn their livelihood and mostly lacking any type of social security, they are vulnerable to pressures from employers, such as on their wages and work conditions.This means that power relations within this segmented labour market opens up the fur- ther possibility for downward pressure on wages in already low- wage countries. The expert presentations at the NPTs indicated that the general trend in wages described above (stagnation of nominal wages and fall of real wages) also applies to the garment sector in Asia (see section on poverty wage below). Hence,Asia is not only the largest host of investment in the garment sector, but also the host of most of the global working poor, among which women comprise a significantly high proportion (Bhattacharjee and Roy, forthcoming 2015). Finally, experts mention the important role of governments in set- ting the ground for the current structure of GPN in the garment industry. On the one hand, countries from the Global North have pushed international trade and investment agreements to facilitate export-led industrialisation in low and middle-income countries. On the other hand, low and middle-income countries have them- selves put in place national regulations facilitating such a develop- ment model of which a stark example are the export processing zones. With the intention to attract elusive investments, govern- ments have favoured manufacturing companies over human rights of workers in these companies, as is very clear from several in- stances shared at the tribunal (see for instance the discussion about Export Processing Zones in Sri Lanka). To conclude, the discussion above and in the abundant literature on the subject, clearly depict the dominance of GPNs in the Asian garment industry indicating that any intervention that aims to ben- efit production workers in this buyer driven industry has to consid- er the interlinked factors of (a) low retail prices for consumers, (b) retailers and brands’ huge profits, (c) reduced prices for suppliers, and (d) stagnant wages of workers. It is important to point out that the issue of low wage is often linked to economic crisis or lack of sufficient resources. However this is far from the reality, as we can see from the table below. It reveals the fact that while poverty wag- es are being paid, prominent brands in the garment industry are making massive profits, even during and after the economic crisis. While poverty wages are being paid, prominent brands in the garment industry are making massive profits, even during and after the economic crisis. 2008 2010 2012 2014 In Euros Turn over Profits Turn over Profits Turn over Profits Turn over Profits Hugo Boss AGv 1.68bn 112m 1.73bn 188.9m 2.35bn 307.4m 2.43bn 329m Adidas Group 10.8bn 642m 11.99bn 567m 14.88bn 791m 14.49bn 839m H&M 11.74bn 1.73bn 14.32bn 2.11bn 15.9bn 1.9bn 16.98bn 1.94bn Inditex Group 10.41bn 1.26bn 12.53bn 1.74bn 15.95bn 2.37bn 16.72bn 2.38bn Table 2: Sharp contrast: brands’ and retailers’ profits Source: Luginbühl and Musiolek 2014 Cambodian workers eating on break 1211
  • 8. I. Dehumanising workers There is a strong feeling of urgency that emanates from the testimonies and is likewise captured in the verdicts of the juries. In many ways, this urgency is linked to the deep level of marginalisation, dis-empow- erment and even dehumanisation that workers in the garment industry are subjected to.The meaning of dehumanisation is aptly but simply captured in the experience of many workers that a simple family life is impossible. Dammika, 39 tears old, originally fromWalapane, 300 kilometres from Colombo, Sri Lanka, has worked in the garment industry in the Katunayake FreeTrade Zone for 19 years.In her testimony at the Sri Lanka People’sTribunal in 2011 in Colombo, she shared: “I was compelled to marry late because of my poor salary which was barely adequate to meet my basic needs [...]. [Now] I am not able to have a normal family life with my husband and child mainly because I do not earn enough. [...] I live separately from my husband and my child [because the cost of keeping my child with me is too high]. I can hardly participate in the nurturing of my child who will grow without her mother because her mother earns too little.” This section synthesises the key issues emerging from the testimonies made at the Tribunals, with a focus on the detailed testimonies of 40 workers. It also draws from the rich expert testimonies and the few buyers’ testimonies. Key Issues in Garment Industry: Towards a Regional PerspectiveS ECTION - III Chisshanthy, who has worked in the same FTZ for 6 years, adds, I have been married for 4 years now and I have not been able to conceive yet. The doctors have diagnosed that this condition is due to excessive work and mental stress at work.Though I have been advised to take more rest, I have not been able to do so due to econom- ic reasons. A women worker from Cambodia (Heap Kimhour) concluded her testimonies by saying, After describing my situation in this hearing, I hope that all the concerned parties will help to make workers get the living wage so that we can meet all my daily basic needs, enjoy good health and support our families to live in dignity as human beings. These women have migrated at a young age from the countryside in search of a livelihood for their families. But it is painful to see that even after years in the industry, they are still not even in a position to have a family of their own. As mentioned earlier, workers in the garment industry usually come from marginalised sections of their society. They are most often women from poor rural backgrounds, with low levels of education, and have families that their factory incomes are expected to support. While these characteristics are fairly similar across the Asian garment workforce, the poverty level of the region or country where work- ers live and work also informs the nature of the labour market and industrial relations they are faced with. Poverty Wages The workers’ testimonies and various studies presented and high- lighted in the Tribunals show that in all countries, except in Indo- nesia, legal wages are set at the poverty threshold. In addition to this, the poverty line is itself defined at a very low level.The wag- es of garment workers were consistently shown to be hovering around the legal wage. In case of Indonesia, though there is a legal definition of the living wage it has been defined on the base of a person’s and not of a family’s needs, as is the standard definition. In consequence, the actual wage, even in Greater Jakarta where the labour movement is strongest, is not adequate for a family. In the words of Anoma, a worker in the Biyagama FreeTrade Zone near Colombo,“Having worked for more than 13 years, I still do not get a wage that is enough to meet my needs”. It was shown by the testimonies that the garment industry in Asia does not support decent standards of living for workers and their families. In addition, the Tribunals brought out the fact that the prevailing wages of garment workers (and therefore, the legal wage in each country) is only about one-third the required living wage. A worker from Cambodia (Heap Kimhour) states: “My basic wage as a worker at Grand Twins is 66 US$ per month. Such a low wage, can- not cover my [expenses]. In total I need to spend around 180-185 USD$ per month. My wage does not cover all my expenses but I have a food allowance from the factory. Apart from taking help from my husband’s income, some- times I take a loan to cover all my daily expenses” 14
  • 9. This is supported by the recent study byWorkers’Rights Consor- tium (WRC) in 15 leading garment exporting countries, which shows that wages ‘provide barely more than a third (36.8%) of the income necessary to provide a living wage’ (WRC, 2013: 2). According to this study, the minimum wage in Bangladesh, even after the revisions forced by the growing struggle of workers, is only 14% of the living wage.The WRC study further shows that the wages for garment workers fell in real terms between 2001 and 2011, and the gap between the wages of garment workers and the general prevailing wage has widened (WRC 2013: 3). As discussed in section 2.2 above,wages in the garment industry have stagnated, if not declined over the past decade. Further, workers from all the countries testified to the extensive failure in complying with the legal wage in the garment industry. This is supported by the audit report done by the Fair Labour Association (FLA), a multi-stakeholders’ initiative, of its member companies which are among the dominant brands globally (FLA 2008).The audit report shows the abysmal failure of these com- panies to ensure implementation of even minimum wages in the industry despite decades of campaigning, CSR initiatives and pri- vate auditing of firms (see section on Codes of Conduct below). Wage Theft and Intensification of Work One of the expressions of the unequal relation of power in industrial relations is that of ‘wage theft’.Though the phrase was mostly used in the testimonies of workers from India, the same dynamics can be seen in different parts of the region. Differ- ent forms of wage theft include: paying single rate for overtime while the statutory overtime rate is double the regular rate;pay- ing workers at a salary grade (or scale) below the skill level of their employment; under-payment of statutory minimum wages and non-payment of benefits; as well as random cuts in salary and ‘miscalculation’ of tally of overtime hours (Anuradha Ver- ma, NCR, India); compulsory overtime without pay (colloquially called ‘OC’ in Bangalore).The question remains as to why such blatant violations of the law can be perpetrated. The testimonies from NCR , in India, indicate that a climate of fear prevails and is actively maintained. Scolding has become a common phenomenon and abusive language is used abundantly. The vulnerability of the worker that has led him/her to this job is continually exploited and any attempt at unionising is sup- pressed at the very initial phase, ensuring that there is no collec- tive process to raise a voice of disagreement, let alone protest. As an additional preventive measure, any trace of employer - employee relationship is avoided. In such a context there is no other choice but to tolerate abuses. • Vinod Kumar, Jannpur district of Uttar Pradesh, “Nobody raises [the wage theft issue] in the factory due to fear of losing the job.” • Arvind Kumar, Asadiya village, Uttar Pradesh, “Once we formed a union but our leader was sent to jail on the false charges of eve-teasing.” • Ashok Kumar Singh, Jaunpur district of Uttar Pradesh, “We tried to make a union secretly twice, but we were given death threat and our leaders were terminated from the company.” • Anuradha Verma, Kanpur, Uttar Pradesh,“I was a union member of my company and for that I bore atrocities from managers.” • Sanjay Kumar, Badaya village, Uttar Pradesh, “I meet union people very secretly, if company people come to know about it, they will oust me from the company.” In Bangalore too, similar dynamics are visible. Most women are the main earners of their families, carrying heavy responsibilities on their shoulders.Testimonies report a climate of fear. Scolding and harassment is so common that it has driven workers to suicide, as testified by Mallige, 38 years old, in a gar- ment factory near Bangalore for 8 years: Any woman, who dresses well, invites dirty looks and comments – the production supervisors de- liberately touch your hand or body while taking the production – we are expected to stay silent or face their wrath. [The supervisors shout at us for no reason.] Unable to bear the shouting and the pressure,we end up crying many times – even that, we have to go to the bathroom to cry and come back to the work. Such insults and harass- ment has driven women like Ammu, Rekha and many other women in the industry to suicide. These cases reveal not simply a disrespectful and inhuman treat- ment but is an expression of the skewed power relation between these workers and the factory managers. Another expression and tool of this dynamic is the setting of unre- alistic production targets testified to by many workers.Targets are often by the hour and do not seem to have any scientific grounding. Sakamma, 22 years old, garment work- er near Bangalore for the past 8 years explains, If [the production target] is 80 pieces one day, next week it is 100, 120, 150, 160. Like this each day the production increases. Because of this we have to work without even drinking water. If we drink water we have to go to the toilet [and we don’t have time for that].Though we have 30 min- utes lunch break we finish eating within 10 min- utes and work another 20 minutes. If we do not complete the production then they punch our card and make us do OC10 till 6.30. If we do not complete our production they scold us [...] snatch the piece from us […] and throw the piece on our face. In both Bangalore and the NCR, the necessity of home based work or overtime in order to ensure that workers can make ends meet is overwhelming.This was also expressed in the testimonies from the three other countries,especially Cambodia and Sri Lanka.How- ever, workers are at the mercy of factory managers about when they will be able to do overtime, and it is then a compulsory re- quirement. This is best expressed by Sanjay Kumar, from Badaya village, Uttar Pradesh, India and has been working the garment sec- tor in the NCR for the past four years, I have limited salary and it is tough to survive in that amount, hence I do overtime also. Howev- er, overtime is possible only if company offers it. Moreover, it’s compulsory. Even if you are ill, you have to do it. […] When there is no demand for goods [there is no overtime]. Usually then, I have to either borrow money or I have to delay the payment of rent and for groceries. It is important to note that India, as several other countries in the region, has a high level of inflation.Thus a sustained standard of living for workers and their families can be ensured, only if the employers increase wages at least at par with inflation. In the absence of such increases, the pressure on workers’ income is one more element that skews the balance of power against the workers and results in intensification of work for a falling real wage. Caloric intake and health It is not only the workers’ family life that gets affected, but also their own health. Many testimonies refer to feelings of exhaus- tion after work that do not allow them to do their housework (especially testimonies from workers based in Bangalore), or that lead them to go to bed without having prepared dinner for themselves (for instance in the NCR).Testimonies also high- lighted that long hours of work negatively affected their repro- ductive health (for instance Anoma in Sri Lanka).Workers from Indonesia reported violations to the right to health care as a result of practices such as forced overtime; not being permitted to go to the toilet; poverty wages that prevent workers from buying health insurance for themselves and their family; and the 9 NCR is one region were men outnumber women as garment workers 10 OC = un-paid compulsory overtime in colloquial parlance used in the factories around Bangalore. 1615
  • 10. country’s poor health infrastructure and facilities that do not readily provide assistance to workers in need of medical care. Importantly, workers on strike have been denied medical care when they were abused and attacked physically.Workers from all countries reported being unable to take leave when sick due to the prevalence of punitive measures. A startling instance of the long term impact of such living con- ditions, and particularly of the combination of low caloric intake and harsh working conditions on workers health was the case of mass fainting in Cambodia in 2011. It is estimated that in that year alone, around 2000 workers fainted while working. A worker (Hang Kimseak) explains, Before fainting, workers had worked up to 12 or 14 hours per day and sometimes they worked continuously overnight [for overtime]. Workers [under Fixed Duration Contracts] have no job security and they need to work overtime when the employer asks them to. [The production pro- cess] uses a lot of glue which emit strong odours. The temperature in factory is high, and the ven- tilation is poor and a lot of chemicals are used. They eat cheap food [as they] cannot afford to eat more nutritious food because they earn such low wages. Another worker (Suon Sokhunthea) adds, [Work in the garment industry] results in the pale and weak appearance of workers who are un- der-nourished. We notice that those who work for more than five years suffer poor health and become increasingly weak and thousands of workers are fainting in the workplace. Workers noted stress, anaemia and malnutrition as common ailments and shared that their income was not adequate for a (Above 4 pics) Cambodian workers and experts testifying (Right page) Cambodian workers meeting together 1817
  • 11. and physical trauma they face; the de- cision to resign is not in their hands and they have no option.This was expressed in the testimony of Karpakam, from Thalapatty village: “ I was paid a monthly salary of Rs. 1,250 after deducting money for food and accommodation expenses. My brother used to come to factory once a month to get my salary.[...] I suffered heavy pain and blood loss during menstruation and I be- came physically weak. I was abused and harassed by the supervisors. Even with this entire physical and mental trauma [I] had to tolerate everything, as I needed the job for the income.” In each of these countries, women are a larger component of the workforce in the garment sector than in the national econo- my.This is true within India also, with the exception of the NCR. As discussed earlier, foreign investment actively seeks out the most pliant, poor and undervalued sections of the workforce. Despite the frequent assumption that women’s incomes are dis- pensable for the family, we have seen that women employed in the garment sector are often the main wage earners in their families.This kind of precarious work is a key factor contributing to the pay gap between man and women at the national and global levels. Raising the floor of vulnerable women’s income is both a way to decrease the gender wage gap and to raise the value of women’s work,and thereby their social status and value. To conclude, it is clear that workers are not able to make a living from their job in the garment industry, but are compelled to remain in this employment due to high levels of economic and social distress and lack of alternatives.The expectation from gov- ernment and workers that the garment industry would provide a positive contribution to poverty alleviation was misplaced. In fact, the industry exploits the vulnerability of the very people it is supposed to help, in order to take advantage of them. In the process, worker’s basic rights, such as the Right to Health, family life and Right to Life with Dignity, are set in peril.The argument that the garment industry, as an example of manufacturing in the South, is leading the poor out of poverty is therefore not valid. 3.2 Trade Unions and workers rights It has been argued by several workers and experts that workers’ Right to Association is a pre-condition to the promotion and en- joyment of other labour and human rights. One instance of it is the significant increase in the minimum wage in Jakarta (by 40%) brought about by the pressure put on the Indonesian government by workers’ militancy largely led by trade unions. However, the pic- ture that emerges from the region with respect to subsequent obstruction to unionisation is bleak. In Sri Lanka, the location of garment production in Export Pro- cessing Zones allows companies to restrict the entry of labour activists into the zone.There are only a few collective bargaining agreements that have been signed with workers in the industry and the prevailing minimum wage (in reality a poverty wage) is the benchmark at which wage is determined.At the Sri Lanka NPT, the People’s Advocate explained that there is a strong opposition to unionisation by the manufacturers. In several cases, unions have not been recognised or could not be formed because of manufactur- ers’ opposition and the apathy of the state. Instead of, supporting the genuine demands of workers, the State, itself, is engaged in de- nial of their rights.The ground situation provides us with many sto- ries of victimisation of the workers when trying to raise a collective voice (for instance, Srimathi). Effectively, workers in the garment industry in Sri Lanka’s SEZs face a ‘legal’ restriction to their Right to Association (Sri Lanka NPT, 2011). The picture in India is that of an illegal but effective denial of the Right to Association.Workers testified of overwhelming violations of this right and the list of unfair labour practices is almost endless. Workers attempting to organize have been dismissed, displaced, or shifted. Some were demoted, threatened with pay deductions or intimidated and threatened through violent means. Intimidation and threats are used by employers to maintain an artificial sense nutritious diet.Workers from Sri Lanka identified the long hours as an impediment to having nutritious meals as they were forced to buy pre-cooked meal because of time pressures. This was confirmed by a report that showed that malnutrition due to low wages and time poverty is endemic in Cambodia’s garment workers and has led to a situation where workers are constant- ly weak and prone to collapse, triggered by any of the caus- es faced at the workplace (McMullen 2013).The report found that workers would intake an average of 1598 calories per day, or around half the recommended calories. Studies of workers’ Body Mass Index showed that 33% of workers were medically malnourished, and 25% seriously so. Finally, the report found that workers spend $1.53 USD daily on food on average, when a nutritious diet of 3000 calories would cost $2.50 USD per day. A nutritious diet would equate to $75.03 USD a month while the monthly minimum wage is currently around $80 USD (McMullen 2013). It becomes clear that workers’poor health,including severe mal- nutrition, is due to conditions of work as well as living conditions largely determined by low salary levels. Gender relations One compelling instance of how gender and class relations inter- twine to strengthen each other is the case ofTirupur,in the Indian southern state ofTamil Nadu.Workers who testified fromTirupur, are from landless agricultural labour families, probably Dalits.They are recruited through job brokers under a controversial scheme called Sumangali.This scheme is meant to allow poor families to save financial resources for the dowry expected from them at the time of marrying their daughters. It provides for a three to five year contract at a low monthly salary (generally less than half the statutory minimum wage) at the end of which a lump-sum is provided to the worker. A report on the scheme qualifies the scheme to say:“This exploitative scheme is tantamount to bond- ed labour, because employers withhold part of the workers’ wag- es until they have worked there for three to five years. In addition it was found that workers are severely restricted in their freedom of movement and privacy” (SOMO 2012). Jesurani, from Keezhasadaiyankulam vil- lage in Kalakadu block of Tirunelveli dis- trict, started working at Tirupur mills at 15 years of age. .“I stayed in a small room along with 8 girls of my age.There were only 2 toilets and 2 bathrooms for the 500 workers.We had to get up at 4’o clock in the morning [...] there wasn’t enough time to take a bath and to have our breakfast. Most of the time, I skipped my breakfast, though I felt hungry.The man- agement did not allow us to take a break during the work hours and without any rest we had to work like machines. I managed to work for two years con- tinuously and I did not want to work further in the mill. I went home for a temple festival in 2008 and I told my father that I would not go back to the mill. But the warden from the mill called my father and said that I should come back so that I can receive the promised lump sum money. So my father took me back to the mill after the holidays. I worked for one more year and asked for the money. But the management said that I had taken more holidays and so I had to work one more year to get the money. Due to compulsion from my parents, I worked for four years in the mill to get Rs. 25,000 against the promised sum of Rs. 35,000.” The unequal gender relations further skew the balance of pow- er between the worker and the employer. While these young women have to live through the consequences, the decision of joining or leaving the scheme is mostly taken by their broth- ers and fathers. In some of the testimonies, the workers shared that they were working so that their elder brothers could study (for instance Thulasi, who joined a spinning mill in Tirupur at 15 years).The dowry is itself a crystallisation of a patriarchal system that de-values women and reduces them to property, worthy of little value, belonging to the men in the family. These realities are echoed by women who have to accept whatever mental 11 A dowry can be equated to a sort of maintenance fee. It is illegal in India since 1961, yet the practice in rampant 2019
  • 12. In case 2, the worker and local union leader at M &V International Manufactur- ing Ltd Branch # 4, Cambodia, explains: Workers fear that their contract may not be re- newed if they participate in union activities or be- come union members. [… They] do not dare to join in struggles to demand for any rights or ben- efits because they are worried that the employer will not renew their contract. Ironically, in the period after the onset of the global financial cri- sis, garment exports from Asia have grown. According to data, during the period from 2008 to 2013, world garment exports grew at more than 5% per annum, led by an even faster growth in the Asian region. Prices of garments in destination countries have contracted in the same period, but the market has expand- ed. However, while the industry and its exports grew, working conditions and company requirements became worse, including production targets. This same period has been one of high in- flation in most countries where garment production is concen- trated. Inflation should have led to an increase in wages, and in countries with the strongest unions, it did indeed, such as in the region near Jakarta. But overall response from the industry and the government has been a crackdown on unionising efforts, in- cluding through the use of ShortTerm Contracts, as is evident in most countries, but most clearly shown by the testimonies from Indonesia. It was widely felt that, short term contracts are used as a strat- egy against union building and collective bargaining all over the region, to minimise or ban any possibility of increase in union strength.The end result overall is stagnant wages and an inten- sification of work in a period of inflation while the prices of the end commodity has decreased, markets have expanded, leading to increasing profits of brands and retailers. Workers’ Struggles It is important to note that despite extremely adverse situations, every hearing witnessed testimonies of workers’ struggles. In Sri Lanka, Srimathi shared her successful struggle to ensure statutory payment for her and her colleagues’ wages. In Cambodia the jury heard of the general strike of 13- 15 September, 2010 (Suon Sokhunthea) demanding for increased wages and better working conditions. NCR has been witness to courageous union struggles inViva Global Company for increase in salary, as testified by Anu- radha Verma. In Bangalore workers protested to force the man- agement of Bombay Rayon Fashions Ltd. to pay entitlements and compensation to the families of deceased workers (Bharathi). Struggles against the termination of workers and change in their working conditions from permanent to fixed term workers in PT Crystal Garment and in PT Olympic Garment International and against suspension of wage increases at PT ADI were respec- tively shared by Suparmi, Herdiansyah Latief and Muhtarim, from Greater Jakarta, Indonesia. From these experiences, one can see that most of the struggles are related to increase in wages and minimum wages. However, the backlash against unions in Indonesia, also points to the constraints of country-level based struggles in effectively ensuring workers’ rights and higher wages in a predominantly global industry.The labour struggles and demands of the unions created enough pressure for wages to be revised. However, companies were quick in using a legal loophole to demand an exemption from the application of the revised wage on grounds of economic inability to pay. In 2013, 949 companies submitted an application for exemption and more than half were accept- ed, though predominantly outside of Greater Jakarta (as trade unions are strongest there in the industry).This has been coupled with threats by companies to reduce their labour force through lay-offs, as well as threats to relocate the factory to other areas or even to other countries. Brand-name retailers have engaged fully in shaking their hands of any responsibility. In conclusion, the importance of a regional framework of union action that reduces the real possibility for relocation of the fac- tories while reasserting the importance of freedom of associa- tion, coupled with a strategy that diverts the burden of increased of industrial peace while they obstruct the recognition of unions through ungrounded, time-consuming labour court petitions. Most extreme is the presence and posting of criminal elements in and around factories as a warning to workers not to raise their voice. In addition, there seems to be an intentional State failure to protect workers (India NPT, 2012). It must be emphasised here that in a democratic state, it is the duty of State to protect their workers’ right to dignified livelihood making adequate measures for their social security and ensuring ground-level implementation. But the apex institutions of the present socio-political system are hardly willing to support their workers’ cause, consciously pushing them towards the margins of social structures. In fact, every effort is be- ing made to keep them outside of power structures in order to extract maximum profit out of their labour. In Cambodia too, the situation is grim and workers in the garment sector are facing a recent surge in violent repression against union actions. There is an increased pressure against workers’ freedom of association through widespread victimisation of union activists. In addition, the freedom to demonstrate and to strike (already re- stricted by law) are under attack. Workers testified of 118 union leaders and activists dismissed by their employer and 145 workers sued for protesting for a wage increase at a factory. At the time of the hearing in Cambodia (February, 2012), a minimum of 100 workers had not been reinstated in their jobs. In the same period, four workers were shot by the police during a demonstration over unfair working conditions at a large factory (Phnom Penh Post, 20 February, 2012). In Indonesia,trade unions in the industry are generally strong.How- ever, successful struggles by trade unions appear to have elicited a range of anti-labour and anti-union policies and practices from the employers, and a high degree of government indifference, providing substantial impunity from the law.This is despite the fact that Indo- nesian law includes an evolved body of laws on criminal offences against workers. However, the police has shown unwillingness to investigate crimes against labour and seems to have an unstated policy that labour cases should be resolved in the Industrial Rela- tions Court, i.e. as a civil law offence. Simultaneously, Indonesia is seeing a worrying trend of increased criminalisation of trade union activism.The Tribunal was presented with five instances of shallow criminal cases against workers who were part of a collective action for workers’ rights.This comes as a response to unions’ assertion of the legitimacy of their role and demands. Short-term contracts The testimonies highlighted the trend of the abuse of short- term contracts and the fact that it is at different stages of be- coming a structural element of the employer-employee relation- ship in the region. In Cambodia, this practice was systematically imposed from around the mid 2000s and Undetermined Dura- tion Contracts (for long term employment) are now the excep- tion,counting for as low as 5% or 10% of the workforce in certain companies (such as in Blossom Century (Cambodia) Ltd. and M & V International Manufacturing Ltd Branch # 4 respectively). Contracts are often as short as two to three months. In Indone- sia, the use of short-term contracts is a more recent phenome- non, but already covers a reported 60% of the workforce in the Indonesian garment industry. It has been largely implemented through closing down of factories or through lay-offs and re-de- ployment on short-term contract. In India, short-term contracts have become prevalent through aggressive and widespread la- bour sub-contracting creating a mediated relationship between the worker and the principal employer. Short-term contracts (called Fixed Duration Contracts, FDC in Cambodia) effectively negate workers’ rights to statutory bene- fits such as maternity leave, provident fund, health schemes and seniority bonus. In addition, workers feel vulnerable to their em- ployers’ demands and “worry that their contract may not be renewed if they do not work overtime when requested by the employer, if they take sick leave, or do anything that will make their supervisors unhappy”. (Gnuon Chheng Hour, Cambodia). An intended effect of labour sub-contracting as in India is a shift in legal liability, be it minimum wages or core labour standards, from the manufacturer to the labour contractor. It was stressed in every country that term contracts have a neg- ative role on unionisation. 2221
  • 13. While poverty wages are being paid, prominent brands in the garment industry are making massive profits, even during and after the economic crisis. UN HR Framework ILO Framework Constitution National Laws Indonesia 8 core treaties are legally binding; has signed ICPED. 8 core documents ratified Guarantees human rights Right to live, right to feel safe, right to or- ganize, right to a living wage are guaranteed Sri Lanka 7 core treaties are legally binding; has signed ICRPD, not ICPED. 8 core documents ratified Guarantees human rights and worker's rights No major deficiencies with regard to human and workers rights Cambodia 8 core treaties are legally binding; has signed ICRMW. 8 core documents ratified Guarantees human rights No major deficiencies with regard to human and workers rights India 6 core treaties are legally binding; has signed CAT and ICPED, not ICRMW. Only 4 core doc- uments ratified, C087, C098, C138 and C182 are yet to be ratified Guarantees human rights and worker's rights No major deficiencies with regard to human and workers rights Table 4: Legal Framework of Target Countries Source: Office of the High Commissioner for Human Rights website, http://www.ohchr.org/; ILO website, Normlex page, http://www.ilo.org/dyn/normlex/en, National People’sTribunals’ verdicts. wages from suppliers (already under price squeeze) to buyers (financially highly more profitable), stands out. 3.3 The legal framework Buyers’ testimonies showed that brands and retailers alike assume that the dominant trend is one of the implementation of core la- bour standards within global supply chains. It is indeed true that the governments of most countries where the core of garment production takes place in Asia have ratified or signed most of the nine core international human rights treaties within the United Na- tions (see table 3 below), as well as the 8 core International Labour Organisation Conventions (ILOC), on Freedom of Association (C087 and C098), Forced Labour (C029 and C105), Discrimina- tion (C100 and C111) and Child Labour (C138 and C182), with the noticeable exception of India In addition, legal frameworks in Asia are often developed enough that core labour rights are included in most constitutions and often translated into legislations (see Table 4 below). However, the legal systems fail most workers in the test of practice and implemen- tation.This was best captured by a presentation made by human rights defenders from the Jakarta Legal Aid Institute for Research and Development at the Indonesia PT. The expert presentation showed on the one side, the ineffectiveness of Industrial Relations Courts,and on the other side,the weakness and laissez-faire nature of labour supervision. Similar situations were reported from India, and Sri Lanka.The Indonesian Tribunal termed it as ‘an intentional state failure to protect workers’ (Indonesia PT 2014: 24-26). It was demonstrated that first, the legal process in Industrial Re- lations Court takes a very long time. Second, workers often have difficulty in providing evidence because much of it is in documents and records held by the factory management, and therefore diffi- cult to obtain.Third, verdicts are rarely implemented often due to legal manoeuvres by company’s management, including declaring bankruptcy. Fourth, government agencies often appear to take a “hands off” position when it comes to ensuring that workers’ rights are protected.There is a blatant lack of oversight and sanctions for deploying insufficient number of labour inspectors. Labour depart- ment officials frequently direct that the employer’s criminal offenc- es under the law should be treated instead as a civil dispute - to be resolved through the Industrial Relations Court.This means that workers have to defend their rights under an inefficient section in the civil realm without the government support that would be provided in a criminal action. Finally, it is common belief amongst workers that government officials, including at the Industrial Re- lations Court, are corruptible and might side with the company against financial favours. According to evidence presented to the Indonesian NPT, there has been a one-third decrease in the use of the IRC by workers in the last three years, suggesting a loss of confidence in the integrity and independence of Industrial Relations Court (Indonesia NPT 2014: 15-16).This means that workers are not getting the justice they deserve. It also contradicts the assump- tion that Asia has an established, accessible and robust legal frame- work that brands and retailers can rely on. Often, buyers have their own assessment mechanisms of working conditions in their supplier factories. The testimonies reveal that manufacturers control workers’ access to government inspectors as well as buyers’representatives,either through fear,or by ensuring that the most vocal workers are physically kept away. • “When buyers come to the company, we were forced to tell that we don’t have any problem in the company, we get everything here. If we won’t say accordingly, they will throw us out of the company.” Vakeel Mayan, 35 years old, Lorriya village, Bihar, garment industry in NCR. • “Union members are [...] prevented from speaking to the visiting buyers.” Bharathi,Maddur town,Bombay Rayon Fash- ion Ltd, Bangalore. • “When buyers came, the workers were tutored how to interact with them.” Chikkaiah, Bhimagondanahalli, AI Enter- prises, garment factory in Bangalore. Expert testimonies also highlighted the role of governments in pro- viding a policy framework adverse to workers in the industry.In the expectation of employment creation, national and local govern- ment policies are prioritizing labour-intensive industries that em- ploy a mass of workers.However,these investment-friendly policies include, explicitly or implicitly, curbs to workers’ rights. An instance of explicit curb are the provisions related to Export Processing Zones (EPZ also referred to as FreeTrade Zones) created in 1987 to generate economic development through the promotion of for- eign investments in Sri Lanka. Similar situations were reported from India (Special Economic Zones) and Indonesia (Export Processing Zones) also. In addition to a tax-free status and other benefits, workers’ rights are curbed in the zones by restricting the entry of trade union leaders as well as labour inspectors and represen- tatives from the Labour Ministry. In Sri Lanka, entry is subject to approval by companies and the zones’ Board of Investment (BOI). In addition, wage and work conditions are not set by the Wage Boards, as in the rest of the country, but by the companies and BOI, de facto exempting companies in the zone from providing statuto- ry minimum wages, standard working conditions and benefits (Sri Lanka NPT 2011: 7-9). Governments in the region buy into the argument that providing living wage to workers would compromise the country’s com- petitiveness in the global market and compromise Foreign Direct Investment (FDI) in the country. As a consequence, governments have been non-responsive to the plea of workers and their prac- tices have ranged from collusion with the company to laissez-faire when dealing with industrial relations issues. In the face of grow- ing evidence of the negative impact of their national competitive- ness-led policies on people, and in the longer run, on the economy it seems that governments in the region are showing short sight- edness in framing policies for the industry. In effect, governments have actively contributed to the failure of the industry to deliver the promises of development.This course has to be corrected and governments should ensure that manufacturers provide at least le- gal wages in the country and actively develop frameworks that set buyers to their responsibility to share their profits more equitably and provide living wages to workers in global industries. ICERDInternational Convention on the Elimination of All Forms of Racial Discrimination 21 Dec 1965 CEDAWConvention on the Elimination of All Forms of Discrimination against Women 18 Dec 1979 ICRMWInternational Convention on the Protection of the Rights of all Migrant Workers and members of their families 18 Dec 1990 ICCPRInternational Covenant on Economic, Social and Cultural Rights 16 Dec 1966 CATConvention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment 10 Dec 1984 ICPEDInternational Convention for the Protection of All Persons from Enforced Disappearance 20 Dec 2006 ICESCRInternational Covenant on Civil and Political Rights 16 Dec 1966 CRC Convention on the Rights of the Child 20 Nov 1989 ICRPDInternational Convention on the Rights of Persons with Disabilities 13 Dec 2006 Table 3: Nine United Nation Human Rights core treaties 2423
  • 14. I. Right to a minimum living wage Taken together, the NPTs’ verdicts find overwhelming evidence of significant deficits in the implementation of internationally recognized standards for work with human dignity. The verdict from India states that there is “evidence of a situation of grave and systematic violations of individual and collective human rights” (India NPT 2012: 19).The verdict from Indonesia goes further and states:“The nature, extent and long duration of continuing vio- lations of garment workers’ rights is indicative of a systemic violation of their fundamental right to a decent life lived with human dignity” (Indonesia NPT 2014: 24). Taken together, the NPTs’ verdicts find overwhelming evidence of significant deficits in the implementation of internationally recognized standards for work with human dignity. The verdict from India states that there is “evidence of a situation of grave and systematic violations of individual and collective human rights” (India NPT, 2012: 19).The verdict from Indonesia goes further and states:“The nature, extent and long duration of continuing vio- lations of garment workers’ rights is indicative of a systemic violation of their fundamental right to a decent life lived with human dignity” (Indonesia, NPT 2014: 24). Further, the verdicts conclude that not only are countries’ legal minimum wages far below what is needed for a decent life, but many workers in the garment industry receive less than the legal minimum wage also, with “disastrous effect which ripples through the family, the community and the nation” (Indonesia NPT, 2014: 25).The wages paid have been judi- Recommendations from the Tribunals and Asia FloorWageS ECTION - IV This section synthesises the recommendations from the four National People’s Tribunals and draws linkages with the Asia Floor Wage proposal, in relation to its legitimacy, feasibility and the constraints to its implementation. It also discusses the weaknesses and failures of the existing governance mechanisms in global industries. 26
  • 15. ciously termed as “poverty wages”. The Tribunals invariably “accept that the Right to a Living Wage is both a distinct human right in itself and an enabling condition for the realisation of other economic and social rights’’ (Sri Lanka NPT, 2011: 5). Hence, they recommend its adoption in labour standards and regulatory frameworks of the countries (Sri Lanka NPT, 2011: 15). In addition, they also endorse that the ILO should integrate and develop an international framework that specifies the Right to a Minimum Living Wage (Cambodia NPT, 2011: 18, Sri Lanka NPT, 2011: 16). The Convention on Minimum Wage of the ILO is inadequate in this context as it does not define any criteria for quantifying sufficient minimum wage. In fact, it only deals with firms and states within national frameworks, and is therefore ineffective to address issues in industries where GPNs are the dominant form. It is useful to note that the due diligence mechanism evolved by the Human Rights Council within the Business and Human Rights discussion is an important instrument from the perspective of in- dustries structured within GPNs.The Asia Floor Wage framework presents an opportunity to bridge both these international mech- anisms. The verdicts resoundingly approved the legitimacy of the living wage concept and recommend its urgent implementation, as a “concrete expression of accessibility to a fundamental human right” (Indonesia NPT, 2014: 27).The verdict from the India NPT states that the proposal of the AFWA represents an important instru- ment that allows the applicability of “a general concept to the real conditions of the garment industry” (India NPT 2012: 17).Thus, the verdicts recognise the Asia Floor Wage as a quantitative definition of the qualitative concept of living wage.In this sense,the Asia Floor Wage is a practical implementation of the concept of living wage. The verdict from Indonesia recommends “The recognition and im- plementation of the living floor wage as defined, developed, updat- ed by the AFW must be the joint and urgent responsibility of the Government, of all dominant brands, of the factory owners and suppliers” (Indonesia NPT, 2014: 27).The verdict from Cambodia NPT specifies that the government of Cambodia should “develop both the international and national legal frameworks as to clearly specify the ‘right to a minimum living wage’ (Cambodia NPT, 2012: 16).The Asia Floor Wage is therefore an accepted, legitimate and necessary norm to respond to the situation presented at the four NPTs and faced across the region. II. Need for governance mechanisms in global industries The dominant instrument for regulating labour standards in global industries are the voluntary Codes of Conduct of TNCs (CoC). These codes lay down social and environmental principles to be followed in the supply chain and are also meant to regulate abu- sive working conditions in global industries. In a sense, CoC were developed under the impact of the anti-sweatshop and consumer movements in USA and Europe. It was a response to maintain the brand reputations and share in the competitive consumers’ markets. However, in legal terms, these codes are simply declarations of in- tent and do not generate legal obligations forTNCs to ensure their implementation. Supervision of the codes remains within theTNC itself through mechanisms of internal monitoring. Even in the few cases where external auditors have been brought into the mon- itoring process, the decision on actions to be taken remains with the TNCs. In most cases, the results of the audits are not made public. Codes were also developed through ‘multi-stakeholder initiatives’ (MSIs), which bring onto one platform corporates, non-govern- mental organisations, trade unions, state representatives and aca- demics.This platform negotiates CoCs to be applied by member companies, and other stakeholders are involved in monitoring and sanction mechanisms. Since these codes open spaces for the inclu- sion of trade unions, they are considered more effective in improv- ing working conditions in global supply chains. However, studies have also highlighted that MSIs are not always as inclusive of stake- holders in the monitoring and sanctions process as they set out to be (Fransen and Kolk 2007: 11). Workers waiting forTribunal to start 2827
  • 16. the actual manufacture of the garments” (Indonesia NPT 2014: 24) and are therefore the principal employers in the GPN. In addition, the opacity of buyer-supplier relations is used as an excuse for re- fusing to accept responsibility for the transgressions of their suppli- ers and appears as a mechanism to avoid accountability. In this re- gard,the Indian NPT saw in the opacity of the relationship between the brands and suppliers “a specific and powerful mechanism to avoid being accountable” (Indian NPT 2012: 21).TheTribunals have found that there is ground for “joint responsibility” of both buyers and suppliers (Indonesia NPT 2014: 24). In addition, the current economic conditions are a culmination of policies actively pursued by the State. Hence, the buyers have the responsibility of ensuring a minimum living wage and the State the responsibility to facilitate and oversee its implementation. The Tribunals were presented with evidence of the distribution of profits along the chain. As per experts, suppliers receive approx- imately 25% of retail price, while workers receive only around 1 - 3% of the retail price (2.8% in India) (see table 5 below). Further, it was shown that the cost of wage increase on business is minimal, and theTribunal concluded,“the evidence presented […] indicates that a living wage can be afforded and that such a wage would not make [a country] uncompetitive” (Cambodia NPT, 2012: 14). The logic of the calculation of the AFW across the region is that the wages earned by workers in the same industry should rough- ly provide the same purchasing power so as to not undermine each other and, to some extent, take the wage component out of the competition.The AFW found that wages are roughly the same when measured in terms of purchasing power (and amount to 20- 25% of the wages of the poorest worker in developed world, i.e. a worker earning minimum wages in USA). In addition, worker and expert testimonies showed that current wages paid to workers in the industry in the region amount to a third of what they require for a decent life.The national legal wage definition arises from an analysis of prevailing wages within the country and are therefore adapted to national conditions. However, AFW’s implementation of a living wage is formulated based on the paying capacity of the global industry: the burden of the wage increase (from legal wage level to the living wage level) has to be born by the buyer, while the In short, brands and retailers have framed the codes as part of their Corporate Social Responsibility (CSR) initiatives and made it a private mechanism for regulating labour rights. However, various studies have shown that these codes have barely made any impact on unionisation, collective bargaining or creating decent wages and working conditions. Clean Cloths Campaign (CCC) found that social audits were incapable of finding, reporting and remedying violations of freedom of association (CCC 2005). Even in case of multi-stake- holder initiatives such as ETI a study (Barrientos and Smith 2006) showed that the codes could not adequately address labour rights violations. In addition, there is hardly any transparency regarding the implementation mechanisms and outcomes of the codes (Papadakis 2008), besides lack of involvement of workers and unions in the process. The World Bank has concluded that the unilateral, top- down approach of the codes was “insufficient and even inefficient in achieving further real and sustained improvements” (World Bank 2003: 2). After revising the implementation of existing codes in the concerned countries, every Tribunal recommended that brands and retailers should go beyond this instrument (Sri Lanka NPT 2011: 12, 14; Cambodia NPT 2012: 8, 18; India NPT 2014: 10-11, 21; Indonesia NPT 2014: 18). The need for an alternative mechanism to ensure implementation of labour rights and a living wage in global industries is glaring.This alternative needs to be adapted to the functioning of GPNs, pro- vide for a bottom up process and transparent mechanism in defining standards and norms, and meaningful involvement of workers and trade unions. III. Feasibility of the Asia Floor Wage AFW proposes a mechanism to implement a living wage which is grounded in the functioning of GPNs. Taken together, the verdicts find that the dominant position of the brands and their search for low cost supply drive suppliers to violate the constitutional and legal provisions in their countries, and international normative standards, for fear of losing orders or even relocation of production. “Brands work closely with the suppliers, enter into contracts with them and are largely responsible for all aspects of the production other than Component Cost % Retail Price % Retail Price Fabric $2.80 12.4% 14.2% Label/Pkg $0.45 2.0% 3.2% Labour Cost $0.64 2.8% 2.8% Overhead $0.59 2.6% 0.9% Profit toTier 1 $0.28 1.2% 0.9% Wash $0.15 0.7% FOB Cost to Brand $4.90 21.8% 22.0% Shipping, duty $0.75 3.3% 3.3% Total Cost to Brand $5.65 25.1% 25.3% Retail Price $22.50 100% Table 5: Labour cost of a shirt in global supply chain Source:AFWA 2014 INDIA BANGLADESH Country Name PPP conversion factor (pvt consumption 2011) Local currency figure for 725 PPP Cambodia 2,182.99 1,582,668 Riel India 22.40 16,240 INR Indonesia 5,583.76 4,048,226 Rupiah Sri Lanka 63.68 46,168 SLR Bangladesh 35.43 25,687Takas China 4.32 3,132 RMB Malaysia 2.16 1,566 Ringgit Nepal 39.11 28,355 NPR Pakistan 36.38 26,376 PKR Philippines 27.92 20,242 PHP Thailand 18.19 13,188 Bhat Vietnam 10,178.57 7,379,463VND Table 6: Asia Floor Wage Figure for 2013 in local currencies Source:AFWA 2014 The Asia Brand Bargaining Group (ABBG), initiated by AFWA, com- prises of trade unions from Asian countries that are manufacturing for the global garment market.The countries currently represented by unions in the ABBG are Cambodia, India, Indonesia and Sri Lanka. The ABBG enlists the support of NGOs such as research organisa- tions in the AFWA, whenever necessary. The main purpose of the ABBG is to coordinate bargaining across countries, while focusing on the global supply chain in the garment industry. Its goal is to negotiate with international brands and re- tailers to obtain benefits for workers in the global garment supply chain. The ABBG considers these brands and retailers to be the principal employers in the global supply chain. In addition, the ABBG focuses on the local suppliers and subcontracting employers to en- sure that workers’ rights and labour laws are upheld. The ABBG has four main demands: i. A living wage for garment workers ii. Stop attacks on freedom of association and collective bar- gaining iii. Abolish and regulate contract labour and short term con- tracts iv. End gender discrimination. In conclusion,AFW not only provides a legitimate quantitative defi- nition of the concept in living wage, it also offers a mechanism for its practical implementation.This mechanism is adapted to the func- tioning of GPNs and the relations of power between its different actors, with a concrete location of a bottom up and transparent bargaining process (the FOB price) in which workers and trade unions play a key role. Demands of the Brands Bargaining Group 3029
  • 17. supplier has to commit to ensure implementation, which should be supported by the State. The AFW mechanism is based on the understanding that the FOB is the nodal point between buyers and suppliers. It therefore pro- poses to fix the floor of labour cost, while the other FOB costs are left to discussions between the different actors.This has been termed as ring fencing of the labour cost, which in a way takes labour cost out of the price bargaining process and out of the competition for contracts between Asian suppliers. However, such a mechanism implies the intervention of trade unions in the price bargaining process of the FOB price, in order to ensure the ac- countability of different actors. The verdicts supported this pro- posal and recommend that brands and retailers integrate negoti- ations on the FOB price in their procurement and pricing policies (Sri Lanka, NPT 2011: 15). IV. Overcoming constraints to achieving a living wage On a few occasions, buyer companies testified in the hearings and expressed reluctance to take the steps needed to implement a living wage. Addidas and H & M shared their Corporate Social Responsibility (CSR) efforts and pilot projects for model factories where workers would be paid a living wage.As pointed out by the jury in the verdict from the Indonesia NPT, their responses to a situation of urgency as has been described above, in circumstances in which they are clearly and by far the major financial beneficiaries, is highly inadequate. Given the low labour cost in production (esti- mated to be between 1 and 3% of the retail price) “it is not clear why wages cannot move to the level of a living wage without delay” (Indonesia NPT 2014: 18).While some of them have been working on projects for living wages for workers in the sector for 25 years, there is no figure offered of what a living wage should be. At the same time, there is reluctance to accept the figure given by the AFWA.This shows a clear lack of will and leads the jury to believe that the mentioned projects are just delaying tactics. Another constraint is the reluctance of buyers to accept their role as principal employers of workers manufacturing the products they sell. Buyers take an incentive based flexible approach to securing compliance with their CoC, while it is amply clear that they have enough control over the production process and that they have the capacity to influence workers’ wages and working conditions. Further more, when buyers negotiate an FOB price with suppliers they are directly responsible for the low wages in the factories (In- donesia NPT 2014: 19). However, buyers are not comfortable with the proposition of opening these negotiations to scrutiny and are resisting the demands to ensure transparency with regard to their purchasing practices. The lack of a national or international framework under which transnational corporations, including most buyers, can be brought to justice is another constraint to the implementation of a living wage. Buyers are manufacturers without factories that have shed their contractual obligations to workers by moving production to Asia. On the one hand, workers are not accessing justice against their direct employers in their country of work, on the other, vio- lations of workers and human rights along the supply chain occurs with impunity in the interest of the buyers driving the system. As pointed out in the Indonesia verdict, the concept of brand respon- sibility in these circumstances exists in the concept of vicarious lia- bility in common law, which in essence is reflected in the UN Guid- ing Principles on Business and Human Rights (Indonesia NPT 2014: 20). Verdicts recommended that buyers accept and comply with mandatory mechanisms for protection of workers’ human rights (Cambodia NPT 2012:18) and ensure implementation across the production network (Sri Lanka NPT 2011:15). In this context, it is important to note the recent developments at the Human Rights Council towards a binding treaty violation of human rights byTNCs. The verdicts of the Tribunals have delved into the important role of trade unions in ensuring workers’ rights. Freedom of Association is a necessary condition for the successful implementation of a living wage. However, freedom of association remains one of “la- bour’s most threatened rights” in the recent era of textile and gar- ment production (De Neeve 2008: 214).As discussed above, there is a deliberate denial of this right across the region by suppliers and governments, often in collusion, though for different reasons. Governments are prioritising conditions that would attract illusive foreign investment from a perspective of competition between nations – refusing to recognise the reality of GPNs’ competition dynamics. Suppliers recognise the effects of GPNs on production, but feel that they are already under a price squeeze and do not want to be restrained in their flexibility in organising the production process, including wages and working conditions. Buyers seem to be avoiding giving legitimacy to trade unions, maybe not to upset their profitable supplier relationships. Finally, the verdicts delved into the constellation of actors that are required to ensure the successful struggle for a living wage for gar- ment workers.Verdicts recommended deepening and strengthen- ing social alliances between unions and labour rights NGOs and consumer organisations to pressure brands to adopt a living wage along the entirety of their supply chain (Sri Lanka NPT 2011: 16). In addition, one of the recommendations from the Cambodia NPT points out that “unions and Federations should be united in their efforts to build their collective bargaining power, as well as their ef- forts […] whilst negotiating CBA” (Cambodia NPT 2012: 17).The implementation of a living wage in the industry will require strong coordinated work between unions at the national and global level, as well as with civil society. Fostering joint efforts of Global Union Federations (GUFs) and local unions in the garment sector will be key if trade unions have to play a key role in enforcement of any global agreement that would encompass the entire GPN of an industry. Jury questioning experts atTribunal 3231
  • 18. AFW emerged in context of the rapid relocation of garment produc- tion to the South and the earlier gains of unionisation in the North, which could not be transferred to the South. Local efforts to union- ise garment workers were constrained by a) the limitations of global unions in providing adequate resources and support;b) the widespread organisational fragmentation in trade unionism; c) the failure of CoCs to deliver labour rights ; d) the massive retaliation by employers; and d) the relocation of sourcing orders by brands.The situation demanded new ways of scaling up from the ground and building an effective social alliance at various levels to support new unionism.AFW brought about an alliance between the affiliates of GUFs and new unions emerging from militant and different traditions, into a shared framework that foregrounded the wage struggle as the context for unionisation. AFW is an effort to combine the procedural issues related to FoA with key substantive issues which in the case of working poor centred on the struggle for living wage. AFW is a Southern initiative that has tried to address the key issues that were identified as impediments to unionisation. Lipschutz (2005: 76) identified three key propositions:‘the capital views unionization as an obstacle to efficiency and profits; States worry that labour activism will drive away capital; and workers fear – with good reason – that attempts to organize will get them fired’. The AFW alliance responded with a demand for a living wage that was not connected to production targets; on the one hand, a trans- national concept of a living wage and bargaining to address the relocation threat of capital and, on the other hand, local/interna- tional social alliance to address the retaliation by employers. In this sense,AFW is a combination of a transnational union network and a social alliance network for labour rights.These two axes reflect the broad alliance that is required to address the components of the global supply chain. AFW is an important contribution as a measure of a minimum liv- ing wage within a global production network framework. National and plant level unions as well as GUFs have developed more spe- cific criteria for living wages at national and sub-national levels, and for different sectors.The prevailing wages and these different living wage calculations can be put in a matrix, or a ‘wage ladder’, and become a tool for assessment of living wage gaps and for bargain- ing.The AFW, based on cross border comparative measure in Asia, has emerged as an important tool in the living wage movement. It has also opened up the opportunity for study and research on concrete operationalisation of the concept of living wage. In the next phase, the AFW intends to engage with the GUFs and contribute to the convergence and consolidation of garment unions.This engagement of transnational union network and GUFs is likely to draw these unions of the global south into global fed- erations; create more robust social alliances for additional support for solidarity and access to labour rights; enhance political capacity to enforce framework agreements over global supply chains; and bring about a renewal of unionisation in the global south and deep- en these unions’ participation in GUFs.As the campaign transitions to the next phase, the transnational union network is building up to having a convergent organizing plan and a bargaining strategy addressed to specific brands - through the Asia Brand Bargaining Group. Another element of this strategy will be to influence the evolution of an ILO instrument for defining the criteria for a minimum living wage and the recognition of gross violation of a legal wage as a form of economic coercion, equivalent to new forms of forced labour. The Convention on Minimum Wage of the ILO is inade- quate as it does not define any criteria for quantifying an adequate minimum wage.In addition,it only deals with firms and states within national frameworks, and is therefore inadequate to address issues in industries where GPNs are the dominant form. It is useful to note that the due diligence mechanism evolved by the Human Rights Council within the Business and Human Rights discussion is an important instrument from the perspective of industries struc- tured within GPNs.The AFW framework presents an opportunity to bridge both these international mechanisms and build an inter- national binding mechanism for the regulation of global produc- tion networks and to ensure effective and efficient punitive actions against the violation of FoA and CB. In order to build an effective bargaining strategy it is important to bring the buying practices of the brands into the ambit of negoti- ations to protect the employment security and wages of garment workers. This will create mechanisms to allow the enhanced re- sources coming from the brands to be passed on to the workers through a mechanism agreed upon by local unions and suppliers in the supply chain.The next step is brand bargaining, and a frame- work for converging strategies and actions between global, national and local unions, as well as broaden and deepen the key role of the social alliance networks - between GUFs, national and plant level unions, labour rights organisations, consumer campaigns and social movements - in building an enabling environment for labour rights.The GUFs can enable the evolution towards a Global Wage Accord, a framework agreement adapted to encompass the entire production network that makes Living Wage in the global garment industry a reality. 12 In fact, at times, the CoCs limited the struggles of unions in the South to procedural matters allowing yellow unionism to emerge and become a safe channel for representation in the workplace (ITUC 2007). Way ForwardS ECTION - V 34
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