We are working on a number of ethical trade priority areas:
- Living Wages (ACT)
- Freedom of Association
- Purchasing Practices
- Migrant Workers
Living Wages (ACT)
The Arcadia Group supports the position that all workers in our supply chain, including piece rate, subcontracted, home and migrant workers, should always receive a living wage which is enough pay to meet their needs for nutritious food, clean water and other basic requirements, as well as providing some discretionary income.This should be earned during legal working hour limits (i.e. without overtime).
To achieve this aim, Arcadia is part of the ACT initiative, a collaboration between international brands and the Global Union Federation IndustriALL to promote improved purchasing practices across the industry.
The ACT Initiative recognises that wages in many garment-producing countries are too low, and that systemic change is needed through national collective bargaining agreements formed at the industry level. This should be supported by improved purchasing practices on the part of collaborating brands. A joint approach is needed where all participants in global supply chains assume their respective responsibilities in achieving freedom of association, collective bargaining and living wages.
There are two sustainable mechanisms that we consider have the capacity to deliver freedom of association, collective bargaining and living wages to any scale, while setting a level playing field:
- Industrywide collective agreements
- National minimum wage fixing enforcement mechanisms
Agreement on a living wage should be reached through collective bargaining between employers, workers and their representatives, preferably at national industry level.
Minimum wages play a vital role in underpinning living wages and must be set in accordance with this level and regularly reviewed in line with cost of living increases. This should be underpinned by an adequately resourced regulatory, inspection and legal system that ensures that no less than legal minimum wages are paid to workers.
We recognise that business security and commitment to production countries and suppliers are a key enabler for paying living wages in conjunction with all other pillars of our joint approach.
Achieving living wages requires collaboration between brands, governments, suppliers and trade unions to support a process ensuring continuous and substantial improvement of wages and working conditions.ACT member brands collaborate by improving purchasing practices and supporting collective bargaining processes at industry level in producing countries.Based on an internal assessment of purchasing practices and after consultations with IndustriALL Global Union (the global trade union federation of workers in the garment, textile and footwear industry) and suppliers in several countries, ACT member brands have adopted commitments on purchasing practices that will guide relationships with suppliers worldwide. The ACT member brands have committed to implement these changes progressively until the end of 2023
The Memorandum of Understanding – signed between member companies and IndustriALL – is the basis for the cooperation between ACT members and outlines the framework for action to establish freedom of association, collective bargaining and living wages within global supply chains.
In 2018, ACT held workshops attended by some of our Cambodian and Turkish suppliers.
Freedom of Association
Worker representation and dialogue with management is critical to helping workers improve their conditions and to helping factory managers understand how to retain staff and improve productivity. Freedom of association continues to be a significant challenge and only a small percentage of our suppliers’ factories are known to have a trade union presence.
As part of our auditing process, if a factory is found to be actively preventing workers to join or form a union, this is flagged as a critical (red) risk, and will be reported to our Ethical Trading team and immediately addressed with our supplier.
We communicate with suppliers and factories about the benefits of freedom of association and as a minimum we expect our suppliers to ensure that factories give workers the right to organise unions should they wish to do so.
We continue to ask suppliers to ensure all factories use our Right to Organise Guarantee (RTOG) template, drafted with the help of the International Textile, Garment and Leather Workers' Federation who are part of IndustriALL, the global trade union organisation. This is included in our Code of Conduct Guidebook. We request factories display the RTOG on all their noticeboards, to verbally explain the concept to workers, and to provide the full document with workers’ pay slips twice a year.
The RTOG is currently translated into Arabic, Bangla, Chinese, Hindi, Romanian, Turkish, Urdu and Vietnamese.
The way we buy goods can have a significant impact on the ability of our suppliers and factories to meet our ethical trading standards. As such, we believe that by improving the way we design and purchase products, we can have a positive impact on how our suppliers and factories manage their production practices, their working environments and their employees.
Our membership with the ACT initiative helps us with this work, since they have a significant purchasing practices element.
In 2019, we will roll out a purchasing practices training programme to our employees, with a focus on raising awareness among buyers about how they can improve ethical standards at factories through a better understanding of the challenges manufacturers face, and more effective critical path management.
In recent years, the Arcadia Group has actively improved both the processes and working conditions of migrant workers who travel from one country to another for employment, and worked hard to prevent exploitation of vulnerable groups. Our Migrant Workers’ Guidelines are available in Part 4 of our Code of Conduct Guidebook.
In 2018 a key supplier based in Mauritius made significant progress in creating more effective workplace dialogue to support improved worker engagement. Factory workers were invited to elect their own representatives, were given training in problem-solving, grievance handling, discipline issues, harassment and gender-related questions and in occupational safety and health matters. More than 300 worker representatives were trained across five factories in four different languages. Female representatives received additional support from the Working Women Worldwide organisation.
Representatives continue to meet monthly in each factory, and have selected spokespeople who attend a joint meeting with management every two months to review more complex cases that may require budgetary or policy decisions. The techniques introduced in the Mauritian factories will now be replicated within factories in Bangladesh and Madagascar.