Leading international retailers are failing to fulfil their commitments to pay fair wages to some of the poorest workers in the world, according to a new report.
Six years after the collapse of the Rana Plaza factory in Bangladesh, which killed over 1,000 textile workers and prompted widespread calls for better working conditions, academics from Sheffield University have found that in many cases compliance with advertised standards is patchy and transparency about progress is limited.
Genevieve LeBaron, a professor of politics at Sheffield University and one of the authors of the study, said it was hard to avoid the impression that some of the 20 companies it analysed had signed up to various initiatives partly for their publicity value.
“Brands made commitments about improving pay and conditions that were quite ambitious, but in many cases they are failing to make good on those commitments,” she said.
The definitions used to set out fair pay levels are confusing, as they include multiple specifications of what a living wage is, Ms LeBaron said.
Many governments have set legal minimum wages at little more than poverty levels, fearing that if they do not keep labour costs down then key industries will relocate elsewhere. Cambodia’s minimum wage is less than half what the Asia Floor Wage Alliance has calculated is necessary to live on. In Bangladesh, the legal minimum is less than a quarter of the living wage.
The Sheffield researchers said that the Clean Clothes Campaign’s definition of a living wage is the most robust of the various standards they had considered. Of the companies they looked at, this standard is used by Sweden’s H&M, along with Netherlands-based C&A and G-Star Raw of the US.
Other companies that completed a survey for the report included fast fashion chains Primark and Inditex along with sportswear makers including Adidas and luxury brands such as Gucci.
The researchers flagged inconsistencies in companies’ assessments of whether they met the standards. Many brands have outsourced the process of auditing minimum wage compliance in their supply chains to NGOs who lack the clout to enforce standards, and whose policies are not always compatible with companies’ own codes of conduct.
Ms Le Baron said brands continue to purchase clothing at prices that are inconsistent with paying decent wages, and industry initiatives to improve conditions had often marginalised workers and their representatives.
“The brands hold the key to improvements here,” she said. “They certainly have the funds to meet the commitments they have made — and if they do not then they shouldn’t have made those commitments.”
Social and environmental issues are increasingly important to younger shoppers; Primark recently admitted that its difficulties in the German market stemmed from perceptions that its clothing was poor quality and that it treated workers badly.
“We have been working hard for many years to make sure our products are made with respect for workers’ rights and the environment,” said a spokesman for the retailer, which is owned by Associated British Foods. “We are now putting more emphasis on communicating our work in this area to our customers.”
H&M, the Swedish retailer that has recently come under pressure to deliver on past promises about workers’ wages, said that industry-wide solutions were necessary to make fair living wages a reality.
“We are working together with 21 other brands and the global union IndustriALL, that represents garment workers, towards this goal,” the group said. “This would be a true game-changer and turning point for the industry.”
He added that H&M was one of the few companies to make wage data publicly available.
The Clean Clothes Campaign recently tabled a resolution at the company’s annual meeting calling on the chain to deliver on a 2013 promise to pay a living wage to 850,000 workers in its supply chain by 2018. The motion was defeated.
Spain’s Inditex said it insisted that wages should meet both the basic needs and discretionary income of workers and their families and that they must be earned in a standard working week. “Inditex is committed to support living wages across its supply chain,” a spokesman said.
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