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Retailers & suppliers must address living wage issue – ITGLWF
11
Oct '08
Behind the glossy advertising and the fancy window displays of the fashion world are millions of impoverished workers earning shamefully low wages.

In this scenario, the CEO of a leading retailer earns in one hour what it takes a Bangaldeshi worker earning the minimum wage 42 years to earn, while that same worker has to work 433 centuries to match what a celebrity basketball player earns in one year for wearing a pair of branded sneakers on court.

So says the International Textile, Garment and Leather Workers' Federation which in a bid to reverse the situation has this week launched a living wage campaign to coincide with Tuesday's World Day for Decent Work.

Says ITGLWF General Secretary Neil Kearney: “Fashion and sports goods are very lucrative industries controlled by mult-billion retail giants which subcontract their production out to suppliers in low wage countries.

The combination of power over suppliers without responsibility to the workforce allows brands and retailers to dictate cut-throat sourcing practices designed to keep their costs low and profits high.

“Nor do the suppliers themselves have much regard for worker rights, which in turns breeds a culture of waste and inefficiency as employers become accustomed to living off a subsidy from their workers. Not surprisingly, those with the worst labour conditions are also those which fail on quality and delivery on time.

“Given that wages represent such a minimal proportion of production and retail costs, there can be no excuse for the low wages that prevail in the industry.

One factory in Bangladesh for instance, pays senior operators 1,851 taka (US$ 28) a month to produce T-shirts for a leading brand which sell in the US at US$ 25.99.

The target number of T-shirts for the line is 900 shirts a day. The line is made up of ten operators earning 71 taka a day, which means that the unit labour cost for assembly is one cent.

“In that situation, tripling workers' wages in order to bring them up to subsistence level would still only bring the unit labour cost for assembly to three cents.

Even taking into account other labour costs involved in the finished product, suppliers in Bangladesh and their multinational customers can surely afford the increase!

“Or perhaps these corporations could look elsewhere for savings. A Bangaldeshi worker producing for major international brands who earns the minimum wage will bring home US$ 25 a month.

Contrast that with the US$ 31 million total earnings of the CEO of a leading retailer sourcing in Bangladesh, or the $476 million a leading sportswear company paid in one year for endorsements by celebrity athletes as part of its 1.7 billion advertising budget.

“It is time to call a halt to this situation. The right of workers to organise and bargain collectively in order to negotiate fair wages must be guaranteed and mature systems of industrial relations must be introduced in order to allow for regular dialogue and consultation on all issues affecting workers, including piece rates and targets.

Moreover, brands and retailers must make the payment of a living wage a contractual requirement and must take this obligation into account in price negotiations”, concluded Mr. Kearney.

International Textile, Garment and Leather Workers' Federation

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