WagesThe clothing industry has changed a lot with the time. Until 1980s, there was not much demand or trend of fast changing fashion. The companies would produce standard styles which would remain similar throughout the year. Since the production was not in large scale, the majority of the production took place relatively close to end consumers. Due to this the clothing industry in the United States and many European countries was very prosperous SS1 (Guercini, 2001). SS2 However, the trend changed from 1990s as retailers started making more designs and expanded their product range.
The boom in apparel industry and the trend of “fast fashionSS3 ” (Bhardwaj, et al. 2010) lead to stronger competition and promotion of distinctive brands. This resulted in an increase of pro?ts from unique combinations of high-value research, design, sales and marketing that would allow them and the manufacturers to act strategically by linking with overseas factories (Gere? 1999, pp. 43)SS4 . The manufacturing trend also shifted to outsourcing and moved to o?shore places with low labour costs.Developing countries have become the new hub for the production.
Lot of companies claim that they do not own the production house as they are outsourced and owned by supplier, therefore the responsibility of factory check-ups and human working conditions is of the suppliers themselves (Bhardwaj, et al. 2010).SS5 According to a research by International Labour Organization in 2014, a significant number of the best top 20 producers in the world, such as Bangladesh, Vietnam, India, Pakistan, Cambodia and Sri Lanka, have the lowest minimum wages in the industry. In developed economies, minimum wages is about €825 (US$990) in Spain and €1,480 (US$1,776) in France, while in countries like Bangladesh it is lower than the living wage at 5,300 Takas (~US$65), which is similar in other developing nations (check Fig. XXX). The wages in real terms has fallen in most of the Asian countries as the gap between the wages of an average worker – and living wages for garment workers in these countries has widened (D’Ambrogio, 2014, pp.
4SS6 ). Apart from the low wages, the workers are often exploited as they work overtime, which can sometime reach 12-18 hours (P?onka, 2013, pp. 147).SS7 Although overtime is paid, but it is not double wages as stipulated by labour laws. According to Universal Declaration of Human Rights “everyone has the right to work, (…) the right to equal pay for equal work, (…) to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection (…) has the right to form and to join trade unions for the protection of his interests” (United Nations, 1948)SS8 .Organisations like Asia Floor Wage support the cause and have filed petition on certain countries stating that “The garment industry in Asia, which employs predominantly women workers, is renowned for poverty wages, excessive overtime and poor working conditions. The poverty level wages force workers to augment their income through other means (such as inhuman overtime) leading to stressful, broken lives. We expect a more thoughtful response from our government.
” (Asian Floor Wage, 2011). SS9 Companies like H and Bestseller requested the Prime Minister of Bangladesh, Ms Sheikh Hasina, to raise the minimum wages of the labour, but the increment was not as demanded by the labours and further improvements are still required. In an interview with “Der Spiegel”, a German weekly news magazine from 8th June 2013, Karl-Johan Persson, CEO of H, pointed out that higher wages in the factories of their suppliers are not helping because of the corrupt system and the other fashion brands producing in the same factory but paying less (Tietz, et al. 2013).SS10 The payment system in the RGM industry is complex and ungoverned. Due to the transition to subcontracting in developing countries, it is difficult to maintain the right level of wages. It was found that there is significant difference in the wages given to the labours, some labours are paid wages based on working hours while others are paid according to the piece rate system. Apart from that, wage discrimination is also present on the basis of temporary and permanent labour workforce (Vaughan-Whitehead, 2011).
SS11 The trade unions for garment workers in India were very influential once. But with a shift in manufacturing units from western world and subcontracting it to developing nations has led to decline in unity of trade unions. Shift in payment structure contributed to downward developments. The companies and the suppliers directly fix the wages with the labour contractors, due to which the salaries differ from factory to factory.
The trade unions could no longer stand for the right of the labours as they would switch to factories with higher piece rates or salary more frequently (Bode, 2013, pp. 15). SS12 With the boost in technology, the factories in different segments have upgraded their manufacturing technique and installed new machines which has led to de-skilling the labour process. The machines does not require much technical skills to operate, thus a little training to unskilled labour can get the work done.
Thus, the companies invest more in machines as compared to the wages of unskilled labour. Although, the wages for trained labours increase, but the improvement is still insignificant (Roy, 2009, pp.19SS13 ). Due to the complexity of the challenge of the wage issue in these countries, large apparel companies have taken initiatives to train and educate the labours. For example, H arranged the training of selected factories, “in the creation of workers’ committees via democratic elections and in how these committees negotiate with management, in order to enable workers to improve their working conditions” (H 2013, Meidler, 2013, pp. 23SS14 ).Workers in feel restricted, in terms limited working time and wages, to work in companies with good governance policies. Due to prevailing low wages, workers prefers non-compliant factories where they can work in longer shifts and compensate for the underpayment (Bode, 2013, pp.
26). “Clean Clothes Campaign” has calculated that a T-shirt would cost just 12 cents more if the minimum wages in Bangladesh were doubled, because labour costs accounted for only one to three percent of the final price (Tietz, et al. 2013). Considering the revenue of leading apparel brands runs into hundreds of million to billions of dollars, it is not challenging to reward the labours with bonuses, or any other additional benefits, which can improve the relationship between the employee and the employer.
According to ILO Declaration on Social Justice for a Fair Globalization, ILO talks about “achieving an improved and fair outcome for all” and states “developing and enhancing policies in regard to wages and earnings, hours and other conditions of work, designed to ensure a just share of the fruits of progress to all and a minimum living wage to all employed and in need of such protection” (ILO, 2008SS15 ). In a report by Clean Clothes Campaign, it was found that factories hide the actual time spent by workers as sometimes the labour exceeds legal working time. The garment industry comprise mostly of women are threatened to get fired if they do not adhere to the requirement. Another issue that the workers face is the non-timely payment of wages. The factories frequently delay the payment of wages as a penalty for not meeting the target or not working overtime.
Delay in payments also prevents the workers from finding a new job. Textile, Clothes and Leather Factory Trade Union (SPTSK SPSI), Indonesia said in an interview that “There should be an audit or monitoring on the workers’ welfare, such as whether the wages received by the workers are sufficient to fulfil the workers’ basic daily needs such as the workers do not need to do overtime since the wages have already covered what they need to pay for food, housing, and putting their children to school” (Pruett, 2005 pp. 39SS16 ).
But the workers need to educated or well informed about the code of conduct and the rights so that they can have faith and fully participate in audits.