The Guardian 2 March, 2005

Trading away women's rights

Oxfam International, the non-governmental development and relief organisation recently published a scathing indictment of the global exploitation of women. Trading Away Our Rights: Working in Global Supply Chains uses research from case studies in many countries and interviews with over 1000 workers, factory and farm owners, union leaders, government officials and others to put together a comprehensive overview of this issue. We reprint here some excerpts from the summary of this important new study.

Globalisation has drawn millions of women into paid employment across the developing world. Today, supermarkets and clothing stores source the products that they sell from farms and factories worldwide. At the end of their supply chains, the majority of workers picking and packing fruit, sewing garments, cutting flowers are women.

Their work is fuelling valuable national export growth. And their jobs could be providing the income, security, and support needed to lift them and their families out of poverty. Instead, women workers are systematically being denied their fair share of the benefits brought by globalisation.

Commonly hired on short-term contracts or with no contract at all women are working at high speed for low wages in unhealthy conditions. They are forced to put in long hours to earn enough to get by. Most have no sick leave or maternity leave, few are enrolled in health or unemployment schemes, and fewer still have savings for the future. Instead of supporting long-term development, trade is reinforcing insecurity and vulnerability for millions of women workers.

The harsh reality faced by women workers highlights one of the glaring failures of the current model of globalisation. Over the past 20 years, the legal rights of powerful corporate entities have been dramatically deepened and extended. Through the World Trade Organisation and regional and bilateral trade agreements, corporations now enjoy global protection for many newly introduced rights. As investors, the same companies are legally protected against a wide range of governments' actions.

Workers' rights have moved in the opposite direction. And it is no coincidence that the rise of the "flexible" worker has been accompanied by the rise of the female, often migrant, worker. The result is that corporate rights are becoming ever stronger, while poor people's rights and protections at work are being weakened, and women are paying the social costs...

Shifting risk onto workers

Oxfam's research has revealed how retailers and clothing brands are using their power in supply chains systematically to push many costs and risks of business on to producers, who in turn pass them on to working women.

  • In Chile, 75% of women in the agricultural sector are hired on temporary contracts picking fruit, and put in more than 60 hours a week during the season. But one in three still earns below the minimum wage.

  • Fewer than half of the women employed in Bangladesh's textile and garment export sector have a contract, and the vast majority get no maternity or health coverage but 80 per cent fear dismissal if they complain.

    The impacts of such precarious employment go far beyond the workplace. Most women are still expected to raise children and care for sick and elderly relatives when they become cash-earners.

    They are doubly burdened, and, with little support from their governments or employers to cope with it, the stress can destroy their own health, break up their families, and undermine their children's chances of a better future. The result: the very workers who are the backbone of wealth creation in many developing countries are being robbed of their share of the gains that trade could bring.

    The impacts are felt by workers in both rich and poor countries. Women and migrants from poor communities in rich countries such as US and Canadian agricultural workers and UK and Australian home-based workers likewise face precarious terms of employment in trade-competing sectors. The pressure of competition from low-cost imports is clearly one reason, but so too is the pressure inherent in being employed at the end of a major company's global supply chain, whether it is sourcing overseas or domestically.

    Transnationals adopt new model

    One cause of such precarious conditions is the new business model that has emerged under globalisation. Retail and brand companies have positioned themselves as powerful gatekeepers between the world's consumers and producers. Their global supply chains stretch from the supermarket shelves and clothes rails in the world's major shopping centres to the fruit and vegetable farms of Latin America and Africa and the garment factories of South Asia and China.

    Wal-Mart, the world's biggest retailer, has driven this model, buying products from 65,000 suppliers worldwide and selling to over 138 million consumers every week through its 1300 stores in 10 countries.

    Globalisation has hugely strengthened the negotiating hand of retailers and brand companies. New technologies, trade liberalisation, and capital mobility have dramatically opened up the number of countries and producers from which they can source their products, creating a growing number of producers vying for a place in their supply chains.

    At the same time, international mergers and acquisitions and aggressive pricing strategies have concentrated market power in the hands of a few major retailers, now building international empires. These companies have tremendous power in their negotiations with producers and they use that power to push the costs and risks of business down the supply chain.

    Their business model, focused on maximising returns for shareholders, demands increasing flexibility through "just-in-time" delivery, but tighter control over inputs and standards, and ever-lower prices.

    Under such pressures, factory and farm managers typically pass on the costs and risks to the weakest links in the chain: the workers they employ. For many producers, their labour strategy is simple: make it flexible and make it cheap.

    Faced with fluctuating orders and falling prices, they hire workers on short-term contracts, set excessive targets, and sub-contract to sub-standard, unseen producers. Pressured to meet tight turnaround times, they demand that workers put in long hours to meet shipping deadlines. And to minimise resistance, they hire workers who are less likely to join trade unions (young women, often migrants and immigrants) and they intimidate or sack those who do stand up for their rights.

    Companies increasingly hold up their "codes of conduct" to assure the public that they care about labour standards down the chain. But their farm and factory audits still focus on documenting the labour problems that exist, without asking why those problems persist.

    Many factors can contribute from poor management to weak national legislation. But one root cause, long overlooked, is the pressures of retailers' and brand companies' own supply-chain purchasing practices, undermining the very labour standards that they claim to support.

    Anyone appalled by "sweat shop" conditions in garment factories should be asking: who turned up the heat? The pressure on workers starts far from the factory floor coming down the supply chain through retailers' and brands' strategies. Their demands for "just-in-time" delivery have typically cut production times by 30 percent in five years coupled with smaller, less predictable orders and high airfreight costs for missed deadlines.

    Moroccan factories producing for Spain's major department store, El Corte Ingles, must turn orders round in less than seven days. "The shops always need to be full of new designs", said one production planning manager, "We pull out all the stops to meet the deadline ... Our image is on the line."

    But the image they hide is of young women working up to 16 hours a day to meet those deadlines, underpaid by 40 percent for their long overtime working. "There's a girl who's seven months pregnant working ten hours a day", said one garment worker, "and as she has to make a lot of pieces per hour the employer doesn't let her go to the toilet. It's sheer torture for her, but she can't afford to lose her job."

    Across countries, falling prices (for many garment producers, by 30% over three years) increase the pressure to cut costs; sub-contracting to workshops with far worse conditions is a popular but hidden solution. And when buyers make no promise of future orders, their calls to improve labour standards ring hollow. No wonder that many managers falsify records and intimidate workers to answer questions "correctly".

    The fresh produce industry fruit, vegetables, and flowers is inherently risky, but supermarkets' tough negotiations can increase that gamble. Farmers across the world are made to carry the costs and risks when supermarkets set prices long after the produce has been shipped, when they demand exclusive relationships but then drop the order, and when they run cut-price promotions to achieve their own sales targets.

    "The only ham left in the sandwich is our labour costs", said one South African apple farmer exporting to the UK's biggest supermarket, Tesco. "If they squeeze us, it's the only place where we can squeeze". Little wonder that farmers like him are increasingly hiring women on temporary contracts to work 11 hours a day in the fields for poverty wages, with no sick leave, no maternity leave, and no income security.

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