Originally founded in 1989 in the Nederlands and today spread in 14 European countries (Austria, Belgium, Denmark, Finland, France, Germany, Italy, Ireland, Norvey, Poland, Spain, Sweden, Switzerland, UK) the Clean Clothes Campaign represents the biggest textile trade union and NGOs alliance which works with about 250 world organizations.
Its main activity areas are related to fashion supply chains sustainability, in particular:
They all concern working conditions improvements in the clothing industry and defend fundamental workers rights, and are realized through awareness, research, direct actions and cooperation activities.
If we focus on the present situation
- Flexibility at work and subsequent structural crisis
- A functional divide in the organisation of production and consumption between sourcing companies (brands and retailers), on one hand, and export-oriented manufacturers, on the other.
it becomes clear that:
- Sourcing companies focus on conceptualising the product (design, research, and innovation) and distribution (marketing, advertising), while the labour-intensive processes are outsourced.
- Separating themselves from material production processes, sourcing companies have saved on wage costs and social security expenditures. They have transmitted the burden of labour demands from high-wage organised sectors of the labour market to low-wage and less-organised sectors of the labour market.
- In this type of dual labour market, a company seeks to capitalise the use value of a small number of highly qualified labourers like managers, technicians, designers, innovators, sometimes called symbolic workers – who conceptualise, oversee, manage and reintegrate globally fragmented labourer processes.
Only this small group of ‘core’ workers are essential to the company and kept in-house. They are given stable contracts, job security and high wages, while the labour-intensive aspects of production are performed by a ‘peripheral’ workforce, which can be bought.
- It all results in a de-territorialised production system in which sourcing companies do not need to pay attention to labour maintenance requirements. Workers can’t even rely on the support of legislation.
- Social reorganisation of the work process (subcontracting, sweatshops, home-work) has occurred in ways that isolate workers and prevent collective organisation and its earning and status benefits.
Why is it so difficult to achieve in globalised industries some result?
- The repression of political rights and trade unions in important production countries.
- Employers often use acts of discrimination against union members or workers suspected of engaging in organising activity.
- Factories are located in areas with large labour pools, while the skill level required is generally low. The existence of a ‘reserve army’ of labour can be used to discipline individual workers, or the shifting of manufacturing facilities in reaction to collective workers actions. The redundancy of workers can also be used to cut wage costs and intensify the work level. Lack of alternative employment means that many workers think twice about risking their jobs.
- Lack of resources, such as an informed workforce, time, money, or a local management who understand the importance of the freedom of association and collective bargaining.
- Unequal gender relations. Young women (or teenage girls) are often recruited because employers consider them docile, tireless, and naturally suited to perform repetitive work.
- The way production is fragmented among many production sites and countries makes it difficult to achieve collective organisation. Sourcing companies spread production over dozens of countries and (often) hundreds of suppliers. This divide-and-rule strategy reduces labour’s bargaining power and makes it possible to exploit the locational rigidity of workforces.
- The precarious (‘flexible’) nature of employment: workers who have temporary or seasonal contracts are never certain that their contracts will be renewed.
- Emerging of the global supply chain has altered the balance of power between employers and unions and weakened traditional regulatory mechanisms associated with the state.
- International outsourcing has detached corporations from the specific communities and specific labour pools associated with them. Corporations can pit workers in different localities and different geographical jurisdictions against one another.
Corporations structural power
A structural power is expressed when the purchasing departments of branded corporations decide not to source from unionised factories or when they massively place orders from countries where worker rights are systematically repressed.
The ability to relocate production is another example of the ‘structural power’ uniquely available to corporations.
Deregulation and neo-liberal policies have urged many governments to restructure the labour sector to suppress trade union activity and promote flexible labour.
While legal rights and protections for corporations have been dramatically extended and increasingly institutionalised through the World Trade Organisation (WTO), regional and/or bilateral trade agreements.
The transnational fragmentation of production has turned wages into an international cost of production instead of a local source of demand.
The organisational split between global-sourcing companies and export-oriented manufacturers has undermined the link between labour cost in the production sphere and consumer purchasing power in the market sphere.
Two dangerous developments are emerging.
First: given that most non-labour production costs are stable and more or less equal among the various industrialising countries, the flexible costs (i.e., labour) will remain under a downward pressure.
Secondly, the increasing excess of production capacity means that profits can only be maintained by cutting costs.
Falling export prices triggered by growing industrial output at the labour-intensive end of the chain, might result in increased levels of exports through lower wages, and/or export prices that fall faster than volumes increase.
The integration of the world economy might therefore be accompanied by a growing international disparity in wages, labour costs and labour standards, which is often referred to as the ‘race to the bottom’.
Macro-economic trends are the aggregates of the micro-economic practices of individual companies.
Brand-named corporations, retailers and agents organise how they purchase their products from manufacturers (or suppliers/ vendors).
Purchasing practices that contribute to, or further deteriorate, poor working conditions are often associated with
- unstable relationships with the manufacturers
- widely fluctuating orders
- demanding shorter lead times
- price-setting policies
Many of these practices are designed to transfer the risks to the supplier.
While this sourcing model grants buyers a lot of flexibility, it leaves suppliers with little or no incentive to invest in their workforce, to increase productivity, or change their ‘sweatshop’ business strategies that are predicated on poor working conditions.
Human Rights Due Diligence (HRDD): mandatory policies in Europe?
At the end of January 2021, the Legal Affairs Committee of the European Parliament adopted an important report requesting the European Commission to submit a formal proposal for an EU due diligence law.
The report will be put to a vote during the first March 2021 plenary.
Later, the European Parliament and the EU’s 27 Member States will have to agree on the text for it to come into force.
Source and Insights
The present text is an excerpt from the following article:
Fashioning justice. A call for mandatory and comprehensive human rights due diligence in the garment industry, Clean Clothes Campaign, January 2021