March 2001 Insights Issue #36

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Home Sweet Home? Codes for homeworkers
Sainsbury's and ethical trade
Trade union perspective
Just trading? An NGO speaks

Home sweet home? Codes for homeworkers

Homeworkers are mostly (up to 90 percent) women - the invisible workforce in global production chains. They machine garments, weave cloth, solder electronics, process food, make parts for cars, or pack goods. At best homeworkers face uncertainty regarding employment or social protection; at worst they are specifically excluded. Would regularisation provide benefits such as decent wages and social security?

Two incomes are needed to pull a family out of poverty. Women turn to homebased work because it is flexible: it can be combined with caring for children and other dependants or agricultural work and for women with young children it is often the only alternative. Manufacturing industries, on the hand, demand increasing flexibility and rapid turnaround times from suppliers - often a week (fashion items) to ten days. Garment retailers place smaller orders and only when a specific line is needed.

International competition also means intense pressure to cut costs: companies in Bangkok closed factories due to competition from Vietnam and China and the economic slump, giving work instead to homeworkers. Yet, even craft homeworkers are increasingly dependent on traders for orders, designs, raw materials or loans and are more akin to piece-rate workers. Yet they are denied basic working rights such as a minimum wage or regular work.

The garment industry in Australia outsources most of its work. The Textile, Clothing and Footwear Union (TCFUA) ensures basic working rights for homeworkers through legal protection, the FairWear consumer campaign, a code of practice, and involvement in union structures. B&Q's code of conduct with subcontractors is at an early stage of implementation and in India B&Q has set up a credit and savings group with women making doormats from coconut fibre.

Most homeworkers are piece-rate workers rather than self-employed contractors and should be entitled to basic working rights. For own-account workers, inappropriate regulations often exist - impossible for homebased workers, often the poorest, to meet. Including homeworkers in supply chain governance is no easy task given the complexity of the situation. Firstly, companies need to acknowledge the existence of homeworkers and the contribution they make to production. Further steps include:

• Supporting homebased workers' organisations and ensuring they are consulted in the development of codes.
• Ensuring codes acknowledge the contribution homeworkers make to production by recognising their entitlement to employment rights.
• Ensuring that women homeworkers, the poorest of all, do not lose out from provisions to improve conditions in global production chains.
• Supporting independent women's collectives which market independently, to reduce dependence on traders and merchants.
• Examining the possibility that companies might shorten their supply chains and cut out informal practices.

Jane Tate
HomeNet
Office 20
30-38 Dock Street
Leeds LS10 1JF
UK
homenet@gn.apc.org

Sainsbury's and ethical trade

Retailers, customers, shareholders and other stakeholders have become increasingly aware of ethical trade issues such as child labour, slavery, or abuse of illegal workers.

Sainsbury's 450 supermarkets are UK-based and yet buys from over 1500 suppliers world wide who in turn source from thousands of sites globally. Sainsbury's is committed to product integrity such as quality, safety, legality, and environmental issues. Their sourcing programme, with a Code of Conduct, includes:

• supplier ethical assessment programme

• commitment to stock and raise awareness of fairly-traded products

• active participation within the ETI

• communication concerning ethical trade internally and externally

Evidence suggests that customers now have a better understanding of what they buy. They demand higher levels of quality and safety, want to be sure that production conditions for workers are satisfactory and choose which products to buy based on this knowledge.

How can supermarkets respond to customer demands? By:

• identifying mutually acceptable time- and cost-effective ways for supplier monitoring

• understanding how supply chains operate given their complexity and size

• establishing a monitoring programme of working conditions and assessing where they could have a positive impact.

Liz Fullelove
J Sainsbury plc
Stamford House
Stamford Street
London SE1 9LL
UK
Liz.Fullelove@tao.sainsburys.co.uk 

Trade union perspective

Global trade can be beneficial but breeds exploitation in the absence of protection of basic workers' rights. In return for fair prices, ethical trade demands suppliers pay a living wage, limit working hours, provide safe workplaces, root out slavery, child labour and discrimination.

Key to permanent improvement is the right to organise and bargain collectively. No substitute for legislative action, multi-stakeholder codes of labour practice do address some of these issues. Global unions have thus actively participated in the development of initiatives such as SA8000 and the ETI. Issues still hindering the positive impact of codes and promoted by global unions include:

• Lack of understanding of their key elements. The ITGLWF has launched a global programme to train workers how to use codes to enforce their rights. Similar training is needed for managers and auditors.

• The multiplicity of codes and harmonisation.

Neil Kearney
International Textile Garment and Leatherworkers' Federation
8 Rue Joseph Stevens
1000 Brussels
Belgium
NK-GS@itglwf.org

Just trading? An NGO speaks

With ever-growing scrutiny of business activity against social benchmarks, sourcing products is no longer just about trading for profit. The impetus for this changed perception, and slowly the changing behaviour of consumers, retailers and investors, is largely down to persistent campaigning.

Strategies challenging multinational reputations with the reality faced by producers have driven the adoption of ethical trade policies. But are such threats sufficient to ensure sustainability of this agenda? A compliance mentality based on the need to placate the public's conscience is not enough:

• Corporate responsibility must prioritise the needs and demands of affected workers.

• Companies must listen and react to workers through interviews, risk-free complaints mechanisms and genuine engagement with representative organisations.

Sumi Dhanarajan
Oxfam GB
274 Banbury Road
Oxford OX2 7DZ
UK
sdhanaraja@oxfam.org.uk