The Financial Express

Living wage for RMG workers: Only 21 global brands, retailers strike deal

| Updated: December 16, 2019 12:51:52

Evaly and Fianancial Express Evaly and Fianancial Express
— FE file photo — FE file photo

Twenty-one global brands and buyers have so far signed a collaborative deal that seeks to ensure living wage for garment, textile and footwear workers, including those in Bangladesh.

The brands are Arcadia, Asos, Bestseller, H&M, C&A, Cotton on, Esprit, Inditex, Kmart, NBrown, Lidl, Primark, Pentland, Debenhams, PVH, G-Star Raw, Tesco, Tchibo, New Look, Next and Zalando.

The agreement called 'ACT' (action, collaboration and transformation) was made between corporate signatories and IndustriAll Global Union in 2016.

It aims to establish freedom of association and achieve living wage for workers through collective bargaining at industries linked to purchasing practices.

To achieve its target, sources said, ACT has recently started consultations with Bangladesh to explore the potential for future engagement.

ACT delegates had follow-up meetings with national stakeholders in Cambodia and Turkey while initial country consultations were held in Myanmar.

It sat with Bangladeshi ready-made garment (RMG) sector leaders and local IndustriAll-affiliated rights groups on November 27 to discuss the deal and relevant issues.

Bangladesh Apparel Workers Federation president Towhidur Rahman, also IndustriAll Bangladesh Council former secretary general, said multiple RMG federations and IGU-affiliated units attended the meeting.

Workers need a living wage and it is entrepreneurs, who would implement it, need the ability to pay, he added.

Brands should have a written commitment to this end that they would properly raise their products' prices in ensuring living wage, he added.

Sammilita Garments Sramik Federation president Nazma Akter said no specific decision came from the latest meeting as it was just an initial discussion on ACT.

She, however, laid stress on unionism in factories to bargain, transparency in buyers' purchasing behaviour and other practices, fair price of products to make suppliers pay a living wage.

"As nearly 300 brands and retailers source apparel from Bangladesh, at least 200 buyers should come under ACT to make it successful," she said, citing the number of Accord signatories.

Accord, a platform of more than 200 brands and retailers mainly based in European Union, was formed after the Rana Plaza collapse to improve garment factories' safety in Bangladesh.

Fire, electrical and structural safety in some 1,600 factories has been inspected since 2014 and more than 80 per cent of safety flaws fixed under Accord.

Labour leaders, however, called for bringing more brands under the umbrella and they would bargain with their counterparts (factory owners) for living wage once a written commitment is made.

When asked, International Labour Organization Bangladesh country director Tuomo Poutiainen said ACT promotes collective bargaining at industry and sartorial level.

"Supported by many of the big garment buyers and global trade unions, this adds a welcome new element to the industry where collective bargaining has been very much lacking," he noted.

"Establishment of the collective bargaining process will also bring the parties more together, and hopefully pave new ways to cooperate in future."

"Brands and retailers will ensure that their purchasing practices facilitate the payment of a living wage," according to the ACT memorandum of understanding available on its official website.

ACT defines a living wage as "the minimum income necessary for a worker to meet the basic needs of themselves and their family, including some discretionary income".

"This should be earned during legal working hour limits and should not include overtime," it adds.

The ACT member brands also recognise a strong link between purchasing practices, working conditions and the payment of a living wage, it reads.

Poor purchasing practices can have a negative impact on suppliers and workers in the global supply chain and can contribute to poor working conditions, unauthorised subcontracting, industry people said.

Non-compliance also causes labour dispute and strike and wage which do not cover the basic needs of workers and their families in garment-producing countries.

According to ACT, member brands would support substantial wage growth by incorporating higher wages into their purchasing prices and would support efforts to increase productivity and efficiency.

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