Apparel firms accused of "hidden" supply chain workers
The ITUC report claims 50 companies are employing a hidden global workforce of 116m
Apparel brands and sourcing firms including Gap Inc, Nike, and Li & Fung have been named in a trade union report claiming 50 companies have a hidden global workforce of 116m people within their supply chains.
The report, 'Scandal: Inside the global supply chains of 50 top companies', by global trade union body ITUC, was published ahead of the World Economic Forum (WEF) taking this week in Davos, Switzerland. It reveals what the union says is an "unsustainable business model", with a global footprint that covers most countries in the world.
Of the companies named in the report that produce apparel, H&M, Yue Yuen Holdings, Tesco, The Walt Disney Co, and Wal-Mart are included.
"We have a model where companies can't or won't identify their supply chains and their hidden workforce," said ITUC general secretary, Sharan Burrow, in the report. "They preside over profits based on low wages, lobby against minimum living wages or regulations designed to ensure safe and secure work and turn a blind eye to the use of informal work or even slavery in their employ."
Research for the report highlighted that the US$387bn in cash holdings of 25 companies named in the list could increase the wages in their combined hidden workforce of 71.3m by more than $5,000 for a year.
"Multinational companies make massive profits, while millions of poorly paid workers in their supply chains are suffering," added IndustriAll global union's general secretary Jyrki Raina. "This is compounded by companies' elaborate measures to avoid paying tax, further increasing inequality and undermining society. Multinationals need to be transparent about their suppliers, and guarantee living wages, trade union rights and safe workplaces throughout their global supply chains."
While the report does not break the figures of the "hidden workforce" down by company, the ITUC sets out five recommendations for those included to address the issue: know whom you contract with and publish this; inspect sites, fix hazards and recognise workers' right to safety committees; end short-term contracts; pay wages on which people can live with dignity; and allow collective bargaining for wage share and decent wages and working conditions.
ITUC's Burrow says the number of global framework agreements between multi-national companies and global union federations which address these problems are on the increase, but that global governments too must not neglect their responsibilities.
"Government leaders should implement and enforce the rule of law. If every nation held its big corporations responsible for their business conduct at home and abroad against the set of fundamental rights and safety they expect in their own countries, we could end corporate greed and put the global economy to work for the many rather than the richest one per cent."
In response to the report, a spokesperson for H&M said the company sees its responsibility to work for fair living wages and good working conditions in the countries it buys its products from.
"We want all suppliers producing for H&M to pay a fair living wage – a wage that satisfies the basic needs of the workers and his/her family and provides some discretionary income – and our fair living wage strategy is an important contribution to this. We, as well as IndustriAll and the ILO, strongly believe that wages should be set through collective bargaining between workers, factory owners and governments. This is why our fair living wage strategy focuses on strengthening workers' rights to collective bargaining and creating a well-functioning dialogue between the parties on the labour market.
"Just like ITUC highlights, we also believe transparency is a key catalyst of positive change. We were one of the first fashion brands to publish our supplier list and we keep full track of where our products are being produced. In this way we can focus our sustainability programme and continuously improve the working conditions for the 1.6m workers who are employed by our suppliers."
Other apparel firms mentioned in the report did not return a request for comment at the time of going to press.
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