Covid-19 is a wake-up call to improve protections for India’s apparel sector workers, including the informal home-based women labourers who remain an invisible part of the supply chain.
The Covid-19 pandemic has changed our way of life. We are all learning to live with the virus and the initial shock is receding into matter-of fact acceptance of this new normal. But unforgettable is the image, only a couple of months ago, of thousands of Indian textile workers walking home across vast distances, hungry, tired and facing an uncertain future. Covid-19 devastated the apparel industry, but these images are symbolic of how the crisis has impacted those at the very bottom of the global supply chain: the people who make our clothes. As the apparel industry tries to pick itself up and get back to work, it must commit to not letting this happen again.
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Civil society organisations from across India – Delhi, Uttar Pradesh, Bihar, Haryana, Rajasthan, Madhya Pradesh, Karnataka and Tamil Nadu – have been working tirelessly to support informal and migrant workers since the start of the country’s lockdown in March. Left without work almost overnight, with no transport and racing against state border closures, many workers had no choice but to return to their villages, by whatever means possible.
The collective response to this has focused, understandably, on the immediate humanitarian needs of textile workers. Terrible monsoon conditions and flooding in recent months have not made things any easier. But there are longer-term lessons in this pandemic, and this is an opportunity to take action to address the deep-rooted systemic issues that leave workers so vulnerable in times of crisis.
A critical first step is to universalise social protections for workers – irrespective of their employment status. The World Bank describes social protections as systems that help the poor and vulnerable cope with crises and shocks, find jobs, invest in the health and education of their children, and protect the ageing population. This could include cash transfers, unemployment insurance or policies to promote efficient labour markets that protect workers.
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That a group of workers can exist out of sight to this extent is symptomatic of the broader supply chain set-up – not just in India, but in many of the major garment-making countries across the world.
Beyond that, solutions will need to focus on increasing transparency and gradually formalising the textile supply chain, so that workers at every level are recognised, rewarded for their labour, offered the same protections and above all valued.
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By GlobalDataThe unseen and forgotten
The images of trekking migrant workers are powerful, but there is a story they do not convey: that of the often forgotten and invisible home workers. These are the informal workers, usually women, at the very end of the supply chain, doing fine embroidery, hand sewing and beadwork. Buyers and brands are rarely aware of them; to the broader industry they remain unacknowledged and largely untraceable.
That a group of workers can exist out of sight to this extent is symptomatic of the broader supply chain set-up – not just in India, but in many of the major garment-making countries across the world.
In India, the clothing and textile industry employs approximately 45 million people and contributes 2% to GDP. Even without accounting for the invisible home-based workers, the supply chain remains vast and complex. It starts with tier-1 factories, where final garments are manufactured and shipped off to be sold around the world. These are the suppliers that brands and buyers’ interface with directly, and where business relationships are formal and traceable.
From tier-1, the supply chain trickles down to sub-contracted and more informal manufacturing setups in tier-2, usually employing less than 20 workers and sometimes including home-based workers. Finally, it ends in the tier-3 spinning mills, where raw textiles are manufactured, and brands have less visibility.
As we move through each layer, from tier 1 to 3, the employment and social protection structures enshrined in Indian law start to become opaque and the number of workers hired off-payroll without contractual employment increases, waiting to be hired or fired at a moment’s notice.
Relief measures leave much to be desired
Faced with mass unemployment and industry shutdowns in the wake of the national lockdown, the Indian government announced a number of relief measures for workers. These included an INR500 (US$6.50) one-time cash transfer via the Jan Dhan account – a savings bank account launched by the Government of India to extend financial inclusion and facilitate transfer of government benefits directly to eligible citizens – as well as support through the Employee Provident Fund (EPF) and EPF Advance. In businesses with up to 100 workers where 90% of employees receive less than INR15,000 per month, workers received 24% of their monthly wages into their EPF account, for three months.
While any government relief is welcome, there were concerns that the measures would not be enough – or even reach those most in need. The simple act of accessing support was an issue for some workers. Many field-based organisations field corroborated that not everyone has the Jan Dhan account needed to receive relief funding. For many migrant workers, their bank account and social security schemes are linked to their home villages, leaving those stranded away from home unable to easily access their funds.
As for the invisible home workers, they were the first to lose employment and, with no unemployment benefits in place, their struggle will be both to find employment and rightful recognition as an important contributor in the apparel sector.
Calls for universal access grow louder
Formalisation and universalisation have been clarion calls in the apparel industry for more than a decade now. A collective of Indian trade unions and other bodies has again floated the idea of a universal cash transfer and universal ration access as part of their social protection demands.
HomeNet South Asia, a regional network of home-based worker organisations in eight countries, is now calling for better recognition of home-based workers through policies and laws, to protect them during emergencies like the Covid-19 pandemic. Suggestions include setting up a Recovery Fund for informal and home-based workers; while longer-term solutions include promoting local economies through no-interest loans and tax exemptions for home-based workers’ cooperatives and producer companies.
Their ideas are not naïve. The Standing Committee on Labour – constituting of members of the two houses of the Indian Parliament – submitted its report on the Code on Social Security, 2019, on 31 July 2020. The Code replaces nine laws related to the provision of social security in the workplace. Key recommendations include the government may notify schemes for unorganised sector workers (such as home-based and self-employed workers).
The Committee stated that the Code should provide a framework to achieve universal social security for all workers (including unorganised, gig and platform workers) with a secure financial commitment and within a definite time frame. It also recommended that the government create a separate fund for unorganised workers, and provide a framework of a model scheme that will set out “mandatory minimum entitlements” for such workers across all states; introduce unemployment insurance for all unorganised workers, ensure maternity benefits to all women workers including in the unorganised sector. These are very progressive suggestions and if enforced into law will change the nature of social protection in the country.
Leading Indian economists Jayati Ghosh, Harsh Mander, and Prabhat Patnaik have come out in support of universalisation of access, saying it is not only critical, but feasible. Putting money in the hands of the poor is the best stimulus to economic revival as it creates effective demand and keeps money circulating within local markets. During future crises, an immediate programme of food and cash transfers should command the highest priority. This would ensure everyone has access to support – from formal, recognised workers to day-wage labourers and even the jobless.
The economists have also called for a universal urban employment guarantee programme to plug the gaping hole in employment. They believe local bodies in urban communities should be put in charge of these programmes, placing workers within struggling micro, small and medium-sized enterprises. The central government would cover wage bills until businesses get back on their feet. This would be a win-win for jobless workers and for small enterprises unable to pay salaries.
Times of great distress often give rise to creative solutions and innovative thinking. The danger is that they fall straight off the agenda when things return to “normal.”
Times of great distress often give rise to creative solutions and innovative thinking and these are the kinds of ideas that need to be considered and worked through when government, business and communities are not in fire-fighting mode. The danger is that they fall straight off the agenda when things return to “normal.”
Long-term solutions for the invisible tier
With the government looking at progressive universalisation reforms, the industry needs to walk in step as well. If the industry remains opaque and does not acknowledge its many invisible workers, the government will struggle to protect what it doesn’t know about or can’t see.
A combination of incentives and disincentives will also be needed to encourage tier 1 and 2 manufacturers to formally recognise informal and home workers. Transparency initiatives aimed at improving working conditions will need to look beyond the factory floor to ensure that worker protections are extended to all – not just those who work in plain sight. Brands and buyers, too, will need to acknowledge their existence and do more to understand the nature and extent of sub-contracting in their supply chains.
These deep-rooted issues are more than one set of stakeholders can solve alone. Government, business, development partners, communities and workers’ unions all have a role to play.
Extending the minimum wage and existing social protections to home-based workers is an achievable first step. This will unlock greater value not just for the invisible tier, but for whole communities. And stronger communities will mean greater resilience when the next crisis hits.
The apparel industry as a whole can no longer accept that what is out of sight, is out of mind.
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