Fair Wages: Strengthening Corporate Social Responsibility
By: Daniel Vaughan-Whitehead
ISBN: 9781849801478
The issue of wages in the fashion supply chain is a never ending story: the paid wages, the unpaid wages, those that suffice, or not, for a livelihood. From legally enforceable (although not always enforced) wages, to living wages, and floor wages, money given to workers seems to be at the core of it all. The topic is in a sense the mother of all discussions.
But while wages within the fashion industry are most frequently discussed when finger pointing workers’ rights abroad, the concept of ‘fair wages’ in reality as nothing whatsoever to do with geography, and applies as much to Europe as it does to overseas outsourcing destinations.
Fair Wages: Strengthening Corporate Social Responsibility tackles this issue in a very thorough, and at the same time visionary way: The book aims not at summarising what ‘fair wages’ really is all about, but the the procedures, results and achievements of a project publicly available which aimed at developing an objective framework for their implementation. The project has been elaborated by ILO and the Fair Labour Association, and evaluated in collaboration with the latter.
To convey all the information relevant to understand the concept, it’s history and background, the book is divided into sections of very different lengths but equal importance:
- The Introduction provides us with a perspective of what ‘fair wages’ means. To do that, the imbalances in real wage increases, falling wage shares, and increases in wage inequality are analysed by continent – importantly in the so across Europe and the Americas. And as it turns out, it is not only ‘typical’ outsourcing countries that have to battle with working poor, and increasingly ‘unfair’ wages, but Europe and the US are headed, them too, all the wrong way.
It is also made clear that – with very few exceptions – the existence of a legal minimum wage is conceptually important: it is show that without such a concept, workers of all levels are struggling in larger numbers with sheer survival. EU countries, and the US, are no exception, but rather provide the long-term historic rationale and statistics required to proof the case. - Towards a new wage policy: The fair wage approach. Wages are a firm part of CSR – yet practically, it more often is an ‘either … or’ situation where wage fairness and development is negelcted as a direct consequence of other CSR-related improvements e.g. health-and-safety measures, or better work infrastructre. Both, so many companies do believe and make their stakeholders (and certainly shareholders) believe too, cannot be afforded in anyway.
An analysis of globally existing, hugely different wage concepts however makes it clear, that this is but the prelude of what is really going on.
This analysis is then followed by lining out the different dimensions – necessities and requirements of stake holders – that play a key role when determining how ‘fair’ wages are and what a ‘fair wage’ means for different people and why. Key concepts such as real wages, payment regularity, wages vs. work intensity, wages vs. skill levels, etc. are introduced, and each characterised as to how and why it is relevant for the ongoing discussion.
In a next step, the concepts introduced are set into a larger context with the aim to create an auditable catalogue of criteria, including the sources where from the answers and data can be obtained. Interestingly, sources for errors or lack of data are pointed out, and how to detect, prevent, or counteract, occlusion efforts. - The fair wage approach in practice finally delivers case studies where the audit concept introduced and lined out in the previous section is taken to real life factories and evaluated hands on. The sample of factories audited to evaluate the framework was primarily from China, but other countries where also present. In total 31 companies from China, and 1 or 2 in Bangladesh, India, Indonesia, Sri Lanka and Vietnam where audited.
Summarising all the insights from this detailed section would be completely be beyond the scope of this review, however, here a few ‘high lights’: 42% of all enterprises used fake and/or double records in preparation of external audits; only 23% percent provide some time of social insurance (not even legally regulated aspects); 68% had issues with paying over time as required; required attendances days do not allow to take any holiday at all, not even legally provided ones; and (positively this time): factories have a very real interest in treating their workers well as staff turn over is a very real, very tangible challenge they have to deal with. - Policy conclusions. If the book were from Greenpeace, this section would be were they’d try to bully fashion brands into signing up for their ‘detox campaign’. In other words, in this section the major problems and issues are addressed, and which player – government, fashion brands, NGOs and other – would be the best actor in charge to change the status quo.
- Annexes. Normally, this is the most irrelevant and boring part of any research, or project, or audit. But for once, this section is easily the most compelling, if also the most technical: The audit questionnaires are made publicly available in full detail just as they had been taken into the field for evaluation. Or rather: at the state they have been improved to since.
Fair Wages: Strengthening Corporate Social Responsibility has been the most demanding read I have had in at least a couple of years.
And this in several ways: the book presents the issues around labour wages, very unusually, in their full blown complexity as a global problem. And the rationales, approaches and solutions presented are fine grained, detailed, and require an in depth knowledge of not only the topic as such, but also of how it is address by workers on the pay role, my factory managers, by auditors, auditees, NGOs, and finally fashion brands. Not a single page in the book is a simple, straight forward, easy read.
The book, no doubt, is a compulsory item on the reading list for anyone even only marginally interested in wage and cost issues in supply chains (not merely fashion and textiles only), and should in my opinion be required reading for HR specialists, product managers and the majority of MA, MSc and MBA specialities I can think of.
But, I repeat, it is not an easy read at all, but requires a focused mind to understand and absorb what is laid open in front of the reader.
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This book is available from your nearest book store as well as online from Amazon.
