CAMBODIA: INDITEX Driving Change In Global Garment Industry

More than 1100 workers dismissed for trade union membership or activity have been reinstated, conflicts resolved in countries in every continent, trade unions recognized in ten enterprises and industrial relations management systems negotiated and adopted in five major garment manufacturing companies as a result of the partnership between Inditex, the Spanish-based retailer, and the ITGLWF, the textiles global union federation, a partnership cemented late last year by the signing of their International Framework Agreement, the first covering the supply chain of a global retailer.

Outlining these achievements in a presentation in Phnom Penh before Her Majesty, Queen Sophie of Spain during her current visit to Cambodia, Neil Kearney, General Secretary of the Brussels-based International Textile, Garment and Leather Workers’ Federation said that though there was much still to be done, Inditex and the ITGLWF, through their partnership and International Framework Agreement, had made a positive beginning in promoting the sea change needed in management and trade union thinking to promote decent work in the global textile and clothing industry.

Significantly, the presentation was made immediately after the formal signing of two company-level agreements between Inditex suppliers River Rich Textile Limited and Gold Fame Enterprises and the Cambodian trade union, C.CAWDU and which provided for the recognition of the union accompanied by the introduction of industrial relations management systems including clear company rules and grievances and disciplinary procedures alongside a protocol for management/union relations.

In addition, as part of the agreements a comprehensive manager/worker training programme over a two to three year period was put in place aimed at building the capacity of management at all levels and the trade unions to grow sustainable decent work on the back of continuous improvements in productivity, quality, profitability and international competitivity.

Said Mr. Kearney, “In the trail-blazing International Framework Agreement, signed late last year, Inditex recognizes the ITGLWF as its global partner in the pursuit of decent work throughout its supply chain.

“The agreement provides for the right of all workers to unionize and bargain collectively as the cornerstone of decent work. It outlaws child labour, forced labour and discrimination, provides for the payment of a living wage, puts restrictions on working hours, insists on safe and healthy workplaces and promotes job security free of abusive treatment.

“In the agreement Inditex and the ITGLWF pledge to work together to ensure the full application of these standards by engaging with suppliers and representatives of the workforces to eliminate abuse, build mutual respect and avoid conflict.

“It is an approach based on the employment relationship where the supplier, as employer, takes responsibility for those employed and where the exercise of that responsibility is regulated by a mature system of industrial relations at workplace level involving management and trade union representatives.

“Irregular policing of workplaces through snapshot audits is replaced by constant internal factory monitoring by those who know the enterprise best – management and workers – aided by the commitment of Inditex to build a totally socially compliant supply chain through support and training rather than sanction.”

Mr. Kearney outlined how an unfortunate garment factory disaster in Bangladesh in mid-2005 brought the ITGLWF’s first direct contact with Inditex. “From a low key beginning when we combined our efforts to bring relief to the families of the dead and the injured at the Spectrum factory in Bangladesh we proceeded jointly to deal with conflicts elsewhere in the Inditex supply chain and to recognize the shortfalls in action and capacity at local and national levels around the world.

“It was obvious that the near absence of industrial relations management systems in factories and the inadequacy of supervisor and manager training on labour issues combined with limited trade union organization was creating growing supply chain problems.

“Inditex and the ITGLWF soon concluded that global problems required global solutions, implemented locally, and we began to pool our energies to build the partnerships we knew were needed to achieve decent work in the sector.

“So was born the first international framework agreement on labour issues in a supply chain between a global trade union and a global retailer.

“Such a framework for a joint retailer/trade union partnership was urgently needed to tackle worker abuse in the global textile and garment industry where production is today carried out in 160 countries for export to markets in only about 30 nations making the sector one of the most globalised and most competitive.

“With most production costs fixed, labour bears the brunt of this competition. Globally, the industry is characterized by low wages, excessive working hours, health and safety risks, child labour, discrimination, abusive treatment and job insecurity.

“Abuses are driven by the general inability or unwillingness of governments to protect rights at work and compounded by the fact that most of the workers are women.

“During the 1990s maltreatment of workers, including the use of child labour, disgusted consumers who turned their anger on the brands and retailers who had come to dominate the industry.

“For nearly 200 years, trade unions had defended and advanced workers interests at local and later at national levels. Globalization greatly weakened that defense and retarded advance.

“In the mid 1990s national trade unions began to recognize that the globalization of union efforts was needed to harness economic globalization.

“In the textile and clothing sector the International Textile, Garment and Leather Workers’ Federation which traces its roots back to the 1860s had long been promoting cross-frontier trade union co-operation. With 220 affiliated unions and more than 10 million members in 120 countries it was one of the first global unions to recognize the need for a global drive to promote corporate accountability, in sectors such as textiles and garments, based on social dialogue between employers and workforce representatives.

“Largely unregulated globalization needed to be molded to serve wider interests and the ITGLWF realized that change could best be driven by building partnerships between the industry’s key players, including the brands and retailers as buyers, manufacturers as suppliers and workers and their trade unions as producers.

“The Inditex/ITGLWF partnership is beginning to drive that change for the benefit of workers, their families and communities, the manufacturers and the exporting country involved. As the managing director of Gold Fame Enterprises earlier told Queen Sophie, ‘This approach has enhanced the image of our factory, brought about significant benefits through improved labour relations and a better understanding with our buyers enabling us to greatly increase our turnover forecasts for 2008’”, concluded Mr. Kearney.