I'm just pasting the summary and Introduction to this report, whose link is provided below. Hopefully, lazy bums will read the report—which focuses on condition of women workers but reveals a lot about practices in the whole business that affect ALL workers—before they come back to argue in favour of Big Retail, or else risk the tag of being "'Merkin Dalaal".
By the way, Fox News-types and neo-namaazis will probably call Oxfam a Maoist outfit, so be careful before you allow your tender, mollycoddled and innocent minds to be polluted by "terrorist vitriol".
http://www.maketradefair.com/en/assets/english/taor.pdfSummary
1. ‘As a casual worker, I do not get a bonus, or paid holiday or severance pay. I am looking for a place to stay so that I can collect all my children to stay with me. To be a mother with my chickens under my wings.’
Ragel, picking fruit in South Africa for export to UK supermarkets
2. ‘We have to do overtime until midnight to earn a decent income. I am afraid of having children because I wouldn’t be able to feed them.’
Nong, 26, sewing underwear for Victoria’s Secret in Thailand
3. ‘We don’t have the right to be sick. One day when I was not well and I took a doctor’s note to my employer, he gave me a written warning.’
Zakia, 36, sewing garments for Spain’s El Corte Inglés in Morocco
Globalisation has drawn millions of women into paid employment across the developing world. Today, supermarkets and clothing stores source the products that they sell from farms and factories worldwide. At the end of their supply chains, the majority of workers – picking and packing fruit, sewing garments, cutting flowers – are women. Their work is fuelling valuable national export growth. And their jobs could be providing the income, security, and support needed to lift them and their families out of poverty.
Instead, women workers are systematically being denied their fair share of the benefits brought by globalisation. Commonly hired on short-term contracts – or with no contract at all – women are working at high speed for low wages in unhealthy conditions. They are forced to put in long hours to earn enough to get by. Most have no sick leave or maternity leave, few are enrolled in health or unemployment schemes, and fewer still have savings for the future. Instead of supporting long-term development, trade is reinforcing insecurity and vulnerability for millions of women workers.
The harsh reality faced by women workers highlights one of the glaring failures of the current model of globalisation. Over the past 20 years, the legal rights of powerful corporate entities have been dramatically deepened and extended. Through the World Trade Organization and regional and bilateral trade agreements, corporations now enjoy global protection for many newly introduced rights. As investors, the same companies are
legally protected against a wide range of governments’ actions. Workers’ rights have moved in the opposite direction. And it is no coincidence that the rise of the ‘flexible’ worker has been accompanied by the rise of the female, often migrant, worker. The result is that corporate rights are becoming ever stronger, while poor people’s rights and protections at work are being weakened, and women are paying the social costs.
Exploiting the circumstances of vulnerable people – whether intentionally or not – is at the heart of many employment strategies in global supply chains. Of course vulnerable social groups desperately need employment as a means of escaping poverty and inequality. But it is no escape at all if the way that they are employed turns their vulnerability into an opportunity for employers to pay them less, work them harder and longer, and avoid paying their rightful benefits.
The result is a gradual but fundamental shift in who will gain from trade under the current model of globalisation. The benefits of flexibility for companies at the top of global supply chains have come at the cost of precarious employment for those at the bottom. If this is to be the future of export-oriented employment, trade will fall far short of its potential for poverty reduction and gender equality.
Oxfam’s research with partners in 12 countries involved interviews with hundreds of women workers and many farm and factory managers, supply chain agents, retail and brand company staff, unions and government officials. It has revealed how retailers (supermarkets and department stores) and clothing brands are using their power in
supply chains systematically to push many costs and risks of business on to producers, who in turn pass them on to working women. Chapter 1 sets out the impacts of this trend on women workers and their families:
• In Chile, 75 per cent of women in the agricultural sector are hired on temporary contracts picking fruit, and put in more than 60 hours a week during the season. But one in three still earns below the minimum wage.
• Fewer than half of the women employed in Bangladesh’s textile and garment export sector have a contract, and the vast majority get no maternity or health coverage – but 80 per cent fear dismissal if they complain.
• In China’s Guangdong province, one of the world’s fastest growing industrial areas, young women face 150 hours of overtime each month in the garment factories – but 60 per cent have no written contract and 90 per cent have no access to social insurance.
The impacts of such precarious employment go far beyond the workplace. Most women are still expected to raise children and care for sick and elderly relatives when they become cash-earners. They are doubly burdened, and, with little support from their governments or employers to cope with it, the stress can destroy their own health, break up their families, and undermine their children’s chances of a better future. The result: the very workers who are the backbone of wealth creation in many developing countries are being robbed of their share of the gains that trade could bring.
The impacts are felt by workers in both rich and poor countries. Women and migrants from poor communities in rich countries – such as US and Canadian agricultural workers and UK and Australian home-based workers – likewise face precarious terms of employment in trade-competing sectors. The pressure of competition from low- cost imports isclearly one reason, but so too is the pressure inherent in being employed at the end of a major company’s global supply chain, whether it is sourcing overseas or domestically.
One cause of such precarious conditions is the new business model that has emerged under globalisation, described in chapter 2. Retail and brand companies have positioned themselves as powerful gatekeepers between the world’s consumers and producers. Their global supply chains stretch from the supermarket shelves and clothes rails in the world’s major shopping centres to the fruit and vegetable farms of Latin America and Africa and the garment factories of South Asia and China. Wal-Mart, the world’s biggest retailer, has driven this model, buying products from 65,000 suppliers worldwide and selling to over 138 million consumers every week through its 1,300 stores in 10 countries.
Globalisation has hugely strengthened the negotiating hand of retailers and brand companies. New technologies, trade liberalisation, and capital mobility have dramatically opened up the number of countries and producers from which they can source their products, creating a growing number of producers vying for a place in their supply
chains. At the same time, international mergers and acquisitions and aggressive pricing strategies have concentrated market power in the hands of a few major retailers, now building international empires. These companies have tremendous power in their negotiations with producers and they use that power to push the costs and risks of business down the supply chain. Their business model, focused on maximising returns
for shareholders, demands increasing flexibility through ‘just-in-time’ delivery, but tighter control over inputs and standards, and ever-lower prices.
Under such pressures, factory and farm managers typically pass on the costs and risks to the weakest links in the chain: the workers they employ. For many producers, their labour strategy is simple: make it flexible and make it cheap. Faced with fluctuating orders and falling prices, they hire workers on short-term contracts, set excessive
targets, and sub-contract to sub-standard, unseen producers. Pressured to meet tight turnaround times, they demand that workers put in long hours to meet shipping deadlines. And to minimise resistance, they hire workers who are less likely to join trade unions (young women, often migrants and immigrants) and they intimidate or
sack those who do stand up for their rights.
Governments should be strengthening protection for workers in the face of these intense commercial pressures. Instead many have traded away workers’ rights, in law for in practice. Under pressure from local and foreign investors and from IMF and World Bank loan conditions, they have too often allowed labour standards to be defined by the demands of supply chain flexibility: easier hiring and firing, more short-term contracts, fewer benefits, and longer periods of overtime. It brings a short-term advantage for trade, but at the risk of a long-term cost to society.
Companies increasingly hold up their ‘codes of conduct’ to assure the public that they care about labour standards down the chain. But their farm and factory audits still focus on documenting the labour problems that exist, without asking why those problems persist. Many factors can contribute – from poor management to weak national legislation. But one root cause, long overlooked, is the pressures of retailers’ and brand companies’ own supply-chain purchasing practices, undermining the very labour standards that they claim to support. Anyone appalled by ‘sweat shop’ conditions in garment factories should be asking: who turned up the heat? The pressure on workers starts far from the factory floor – coming down the supply chain through retailers’ and brands’ strategies, as described in chapter 3. Their demands for ‘just-in-time’ delivery have typically cut production times
by 30 per cent in five years – coupled with smaller, less predictable orders and high airfreight costs for missed deadlines. Moroccan factories producing for Spain’s major department store, El Corte Inglés, must turn orders round in less than seven days.
‘The shops always need to be full of new designs,’ said one production planning manager, ‘We pull out all the stops to meet the deadline ... Our image is on the line.’ But the image they hide is of young women working up to 16 hours a day to meet those deadlines, underpaid by 40 per cent for their long overtime working. ‘There’s a girl who’s seven months pregnant working ten hours a day,’ said one garment worker, ‘and as she has to make a lot of pieces per hour the employer doesn’t let her go to the toilet. It’s sheer torture for her, but she can’t afford to lose her job.’ Across countries, falling prices (for many garment producers, by 30 per cent over three years) increase the pressure to cut costs; sub-contracting to workshops with far worse conditions is a popular but hidden solution. And when buyers make no promise of future orders, their calls to improve labour standards ring hollow. No wonder that many managers falsify records and intimidate workers to answer questions ‘correctly’.
The fresh produce industry – fruit, vegetables, and flowers – is inherently risky, but supermarkets’ tough negotiations can increase that gamble. As chapter 4 shows, farmers across the world are made to carry the costs and risks when supermarkets set prices long after the produce has been shipped, when they demand exclusive relationships but then drop the order, and when they run cut-price promotions to achieve their own sales targets. ‘The only ham left in the sandwich is our labour costs,’ said one South African apple farmer exporting to the UK’s biggest supermarket, Tesco. ‘If they squeeze us, it’s the only place where we can squeeze’. Little wonder that farmers like him are increasingly hiring women on temporary contracts to work 11 hours a day in the fields
for poverty wages, with no sick leave, no maternity leave, and no income security.
Time to make trade fair
As part of Oxfam’s campaign to Make Trade Fair, we are joining partner organisations worldwide to demand that women working in the supply chains of some of the world’s most powerful companies get their fair share of the gains from trade. Their experiences and struggles are at the heart of this report and our international campaigning.
Together we are calling for:
• Companies – retailers and brands – to make respect for labour rights integral to their supply-chain business strategies, especially by addressing the impacts of their own sourcing and purchasing practices on the way that producers hire and treat their workers
• Producers and suppliers worldwide to provide decent jobs for their employees, including respect for workers’ right to join trade unions and bargain collectively, and eliminating discrimination against women workers
• National governments, South and North, to stop trading away workers’ rights in law and in practice, and to enforce international labour standards in order to promote decent employment for poverty reduction, gender equality, and development
• The IMF and World Bank to promote workers’ rights throughout their operations as a fundamental tool for poverty reduction and greater gender equality
• Institutional investors – shareholders and pension funds – to use their power in investment markets to promote supply-chain practices that respect international labour standards
• Consumers to insist that retailers and brands ensure that their sourcing and purchasing practices support, rather than undermine, workers’ rights
Introduction
Globalisation conjures up images of multinational companies, flows of investment and technology, and disputes at the World Trade Organisation (WTO). But such images tell only part of the story. Globalisation also has a more human, and more hidden, face. International trade has drawn millions of women into employment across the
developing world. They are producing the goods that are fuelling export growth – yet they are systematically denied a fair share of the benefits brought by globalisation.
It is not inevitable that globalisation marginalises the poor in general, or poor women in particular. Nor is it inevitable that the expansion of international trade creates a ‘race to the bottom’, with investors taking advantage of opportunities to relocate. Increased trade and improved working conditions can go hand-in-hand, if governments, companies, and international institutions create the right policy conditions. That if is a very big one. As the research set out here shows, powerful political and commercial pressures are undermining labour standards. Governments in many countries are actively eroding labour rights, often on the profoundly mistaken assumption that it is necessary in order to attract foreign investment and fuel growth. In many cases they have been actively encouraged to move in this direction through IMF and World Bank loan conditions.
The rolling back of labour rights has coincided with the rolling out of the new business model. For their part, big retailers, brand companies, and international investors have actively encouraged the development of ‘flexible’ labour markets – that is, weaker labour rights – to fit their business needs. The flexibility demanded by that business model – for faster delivery, more exacting technical standards, and lower prices, but no commitment to future orders – is in stark contrast to the high-sounding principles endorsed by companies under the banner of corporate social responsibility.
The current emphasis on adapting labour markets to the dictates of a business model that is spreading vulnerability is shortsighted on three counts. First, and most importantly, improving employment and working conditions would create immediate and tangible benefits for millions of women, providing a powerful catalyst for reducing poverty. It would help to create a new, more equitable pattern of globalisation. Second, by spreading the benefits of trade and globalisation more widely, it would strengthen the legitimacy of an international trading system that is widely – and rightly – seen as failing the poor. Third, improved conditions in poor countries would create new opportunities for investment and growth. Ensuring that the development of globalisation and improved labour standards for women are complementary would start to create more winners from trade.
Ways ahead, and false debates to leave behind
This report argues that companies need to change their sourcing and purchasing practices, if their commitments to be socially responsible are to be more than empty words. Better sourcing and purchasing practices alone would not lead to decent employment and working conditions, but they are an essential part of the solution, and a part that has so far been largely missing from the debate. This report likewise calls on governments to ensure that poor people benefit from trade by ratifying and implementing international labour standards, extending employment protections to all workers and, especially, creating the space for workers to join unions and bargain collectively without fearing for their jobs.
Some commentators will reject this strategy. In particular, enthusiasts for the current pattern of globalisation will argue that more of the same is needed to generate higher growth, increased employment, rising living standards, and ultimately improved labour standards. The arguments that they put forward are well known.
1 ‘Trade and growth first, labour standards will follow’
Trade creates jobs – so the reasoning goes – and as the excess supply of labour falls, wages and working conditions rise. But the link between trade and economic growth is far from automatic, or that between job creation and better labour conditions. Markets may play a critical role in defining the efficiency of resource allocation and generating growth, but market realism has to be tempered with considerations of social justice. Labour rights are not a distant reward of development: they are an essential tool for alleviating poverty through trade today.
2 ‘Jobs in trade are better than the alternatives’
Many economists point out that export-sector workers already tend to earn higher wages than other workers, let alone the unemployed. A woman in Bangladesh sewing clothes for Wal-Mart, so the argument runs, is surely better off than her sister working on a local construction site. In the words of the economist Paul Krugman, ‘In praise of cheap labour: bad jobs at bad wages are better than no jobs at all.’ True: and that is why millions of women take these jobs. But if the best deal that trade can offer to poor people is a marginal improvement over a life of desperate poverty, it is falling far short of its potential. The relevant question is not whether the Bangladeshi woman is marginally better off but whether she, her family, and her country are getting a fair share of the gains that she helps to generate through trade.
3 ‘Improving labour standards is hidden protectionism’
Some claim that improving employment security and benefits for workers in poor countries will take away their trade advantage and price them out of the market. From this perspective, calling for respect for workers’ rights is just another variety of Northern protectionism. This is a weak argument. The cost of providing basic benefits such as maternity and sick leave differs hugely across rich and poor countries. If all countries provided these benefits, relative costs of labour would still be far lower in poor countries. And workers’ organisations in many poor countries are driving the demands for these rights at work to be respected – not to protect Northern jobs but rather to protect their own well-being, health, and dignity. Universal respect for basic rights at work need not adversely affect the competitive position of low-income countries.
4 ‘Strengthening rights will cut jobs’
Some fear that better wages and benefits will mean fewer jobs, leaving communities worse off. Not necessarily so: governments hoping to win investment on the basis of low wages have an out-of-date strategy. ‘Forget about cheap labour,’ advises David Birnbaum, an expert on global garment-sourcing trends. ‘Poverty is no longer
an asset. There is always some new garment-exporting country where workers earn less than yours.’ Low wages and insecure jobs perpetuate poverty in poor communities. When women are better paid and protected in their jobs, they can invest in their families, sending their children to school rather than into the factory or fields to work.
It helps to build a more productive and skilled workforce – and that does attract investors. All this could help to stimulate domestic and regional sources of consumer demand. In other words, shared prosperity is good for investment – poverty is not.
5 ‘More secure jobs undermine flexibility’
Proponents of flexible labour laws (encouraging short-term contracts and easy hiring and firing) argue that they are essential to allow firms to respond to fluctuations in demand. True: seasonal fluctuations mean that labour requirements vary through the year, and employers need to be able to adjust. But ‘flexibility’ is hugely abused in order to secure the long-term effort of workers at short-term costs. Employers in the North and South misuse short-term contracts to avoid paying employment benefits and to undermine workers’ bargaining power in organising. Retail and brand buyers exacerbate the problem by changing orders at short notice and pushing for prices that cannot cover the full costs of stable employees. Flexibility matters – but social justice considerations should set limits to the level of flexibility demanded, especially in unequal economic relationships.
6 ‘Monitoring labour standards throughout supply chains is asking the impossible’
Retail and brand companies are the first to claim that their long and complex supply chains are too complex to monitor. But they already achieve exacting technical, product safety, quality, and delivery standards through those chains. And many leading companies are cutting out layers of mid-chain suppliers and sourcing more directly
from producers. This creates the ideal opportunity for working with producers to ensure that good labour standards are met. Oxfam and partners: campaigning to make trade fair Oxfam has worked for many years with partner organisations around the world who (often in collaboration with trade unions) support workers – mostly women – employed in global supply chains. Together we have conducted research in twelve countries, North and South, to understand the causes behind the precarious situation of these workers. The research, conducted in Bangladesh, China, Chile, Colombia, Honduras, Kenya, Morocco, South Africa, Sri Lanka, Thailand, the United Kingdom, and the United States, focused on two main sectors: garment supply chains to major clothing retailers and clothing brands, and fresh-produce supply chains to food retailers and the fast-food industry. The research documented the experiences not only of women workers, but also of their employers, the managers and owners of farms and factories. These latter voices are rarely reported, but understanding the supply-chain pressures that they face as producers is essential to understand why, as employers, they hire and treat workers in the ways that they do. In all, the research included interviews and surveys with 1,310 workers, 95 garment factory owners and managers, 33 farm and plantation owners and managers, 48 government officials, 98 representatives of unions and non-government organisations (NGOs), 52 importers, exporters, and other supply chain agents, and
17 representatives of brand and retail companies. We have changed the names of all the farm and factory workers interviewed to protect their identity, because many feared that they would lose their jobs for speaking out. We have also kept confidential the identity of the farm and factory managers and exporters and importers interviewed, because many likewise feared losing their place in the supply chains of major retailers and brands. Some staff members of retail and brand companies were also willing to be interviewed only under conditions of anonymity.
Many well-known retail and brand companies feature in this report. Practices vary considerably from company to company, and where particular companies are linked to particular criticisms (or indeed specific good practice) we have made this clear. Generalised statements about industry practices should not, however, be taken to refer
to any particular company.
AuthorTopic: REVELATORY> OXFAM study on Big Retail: TRADING AWAY OUR RIGHTS (Read 224 times)
February 06, 2007, 04:23:59 PM