The concept of a living wage is not new...but its implementation is

The concept of a living wage is not new...but its implementation is

The concept of paying a living wage for garment workers in developing countries is not new - yet its implementation continues to present challenges across the apparel supply chain, as Michael Lavergne explains.   

For many designers who have put countless years of study and sweat into their careers and into the design and manufacture of their own creations, the concept of a guaranteed "living wage" for apparel industry workers seems sure to raise a cheer.

Very few, if any, successful industry players would claim that the road to paying one's dues in the rag trade is paved with gold. Long hours, low pay and even less recognition early on are the norm.

Yet for tens of thousands of developing country garment workers, achieving a living wage may mean the difference between a life of poverty and one where workers can provide the hope of a better life for themselves and their children.

The concept of a living wage is not a new one. In fact, contained within the wording of Article 23 of the United Nations Universal Declaration on Human Rights are the explicit expectations of sufficient wages to guarantee workers everywhere "an existence worthy of human dignity".

This ideal has formed the basis on which NGOs, trade unions and civil society organisations have pushed the discussion of living wage guarantees from concept to concrete policy.

Social sustainability is one of the key tenants of the Triple Bottom Line, in which an organisation's success should take into account its financial, social and environmental performance: profit, people and planet. 

Arguably, responsible business leaders who may genuinely want to ensure social accountability in their supply chains must balance those desires with the financial viability of their companies.

This has often led to various sectors of the industry decrying the logic of increased wages at the bottom of the supply chain pyramid.

Here we are addressing the vast majority of market supply and demand, low to mid-priced branded apparel sourced from low cost manufacturing countries primarily in South Asia and Central America, where everyone from the sewing operator to the store cashier depends on their cut of a garment's margin.

Fair wage pressures
Leading NGOs such as the UK-based Ethical Trading Initiative (ETI), which counts hundreds of brands and retailers as members, have long pushed the industry to go beyond its commitments to ensuring that suppliers pay at least minimum wages and benefits.

But in an industry where factory workers across most of the developing world earn less than an average of US$250 per month, major brands and retailers still spend a significant amount of time and effort dealing with issues of non-payment of wages, failure to provide required local benefits, and proper overtime pay.

The ETI and others such as the Fair Wear Foundation (FWF), the Fair Labor Association and the UN's International Labor Organization have all called for setting living wages which consider not only local minimum salaries but also food inflation, education expenses, health care, discretionary income and other cost of living concerns.

In doing so, the FWF has spent considerable time analysing the actual per garment cost impacts of increasing a production worker's wages. Its detailed Wage Labour background study published in 2011 looked at manufacturing, wholesale and retail pricing impacts across a number of low cost production countries - and projected manageable cost increases at retail of less than 5% on average when almost doubling existing 2010 pay rates against Asia Floor Wage recommendations.

A lack of agreement on formulas for calculating living wages has also been an excuse offered by some industry sources. As the ETI contends in its comments on the issue, it is more important "that companies don't allow the challenge of how to calculate a living wage to distract them from getting on with raising wages".

With the rise of sustainability initiatives among brands, and increased calls everywhere for more attention to the social aspects of corporate social responsibility, ensuring that up-and-coming design industry professionals fully understand the impacts of their manufacturing options early on will go a long way to supporting the Triple Bottom Line's success in the future.

Earning a fair wage in this industry is something every one of us can relate to on a very real and human level.

Michael Lavergne is a sustainable supply chain consultant with 20 years of multinational branded sourcing experience, having worked for Wal-Mart, Hanesbrands, WRAP and Bureau Veritas. He is currently based in Toronto, Canada.