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ACCC approves new 'Code of Practice' for textile sector
Jun '13
The Australian Competition and Consumer Commission proposes to authorise a revised version of the Homeworkers Code of Practice for five years.

The Code is a mechanism within the textile, clothing and footwear industry designed to assist businesses to ensure that they and their supply chains comply with relevant Awards and workplace laws. An objective of the relevant Awards and workplace laws is to protect vulnerable workers. The Code and its accreditation system are overseen by the Homeworker Code Committee.

The ACCC received a number of submissions supporting the Code. For example, Oxfam stated that it promotes the Code internationally as one of the few examples of a code of practice which successfully protects vulnerable workers, in particular, homeworkers.

“The ACCC considers that the Code has a variety of measures which help businesses to ensure that their supply chains comply with existing legal obligations towards workers,” ACCC Chairman Rod Sims said.

“Businesses which are accredited under the Code, are able to use the accompanying certified trademark to demonstrate this to their customers.”

The ACCC considers that the Code is likely to lead to public benefits by providing businesses with a means to efficiently ensure their supply chains are compliant with relevant Awards and workplace laws, and a means to efficiently signal this compliance. The ACCC also considers that public benefits are likely to arise from greater compliance by businesses with their legal obligations towards workers.

The ACCC acknowledges the submissions expressing concern with the Code and accepts that the Code is likely to result in some public detriment including increased businesses costs due to increased auditing and the need for all businesses in an audited supply chain to provide yearly statutory declarations.

However, the ACCC considers that these detriments are limited by the following factors:

- the Code is a voluntary Code, although the ACCC acknowledges that businesses in the supply chains of retail signatories and accredited manufacturers or which are seeking accreditation to meet the Commonwealth Procurement Rules may regard it as involuntary;
- retail signatories and accredited manufacturers are only able to agree to boycott other businesses who are not compliant with their legal obligations; and
-the Code contains safeguards against inappropriate accreditation or boycott decisions.

On balance, the ACCC considers the Code is likely to result in net public benefits. The benefits of efficiencies in supply chain risk management and of compliance with legal obligations to workers are likely to outweigh the detriments.

Authorisation provides statutory protection from court action for conduct that might otherwise raise concerns under certain competition provisions of the Competition and Consumer Act 2010 (Cth).  Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.

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