Fair Wear Campaign Action Speech - Monday 6 November, 2000 - Pitt St Mall, Sydney

Dr Alastair Greig
Senior Lecturer, Department of Sociology
The Faculties, Australian National University
Canberra ACT, 0200

(Text of Speech)

Without an effective Homeworkers Code of Practice, adhered to by all major players in the clothing industry, homeworkers will continue to be among the most exploited members of the Australian workforce. The principal reason why we are here today is to register our concern over the lack of commitment by the Australian Retailers' Association to involvement in the monitoring processes of the Homeworkers Code of Practice. I want to explain to you why the Homeworkers Code of Practice is unworkable without the involvement of retailers and suggest to you that the ARA is lying if they are stating that they have no responsibility over the wages and conditions of outworkers.

WHAT DO RETAILERS SAY ABOUT THEIR ROLE IN AUSTRALIAN CLOTHING PRODUCTION?

FACT 1: AUSTRALIAN RETAILERS NEED A VIBRANT LOCAL CLOTHING INDUSTRY BUT THEY WANT TO KEEP LABOUR COSTS AS LOW AS POSSIBLE

While many commentators have spoken about the decline of the Australian clothing industry over the last decade, more accurately what we've witnessed is not so much the decline of the clothing industry, as its change in character. Retailers need to maintain a vibrant local clothing industry for a number of reasons. First, it is easier for them to control local suppliers and local suppliers provide quicker turnaround. There is also less risk involved in monitoring quality. Secondly, through local manufacturing, retailers can top up on fast selling items, especially seasonal items, and they can have closer personal relations and communicate more easily with local suppliers.

What we've seen in Australia in the clothing industry is a shift out of factory work into more and more outwork. This has suited the retailers who want to maintain as much labour competition as possible to keep labour costs down and retain high profit rates. This situation has only been allowed to occur because powerful players within the industry and neo-liberal governments have maintained the fiction that a deregulated labour market benefits everyone.

But we know that this is a lie. An unregulated labour market only benefits the powerful, such as the retailers, not the homeworkers or the factory workers. Homeworkers here will tell you that their rates of pay have been declining over the last decade. And homeworkers and factory workers must fight together for fairer wages and conditions.

FACT 2: RETAILERS ARE PRINCIPALLY RESPONSIBLE FOR WHAT GOES ON IN THE CLOTHING INDUSTRY

Retailers would like us to believe that it is not their job to know what happens once they place a clothing order with a manufacturer. They like to pretend that they are only shopkeepers.

But they know that this is a lie. Retailers are the key drivers of innovation in the modern clothing industry. They increasingly perform functions, such as design and quality control, which in past times were considered to be part of the manufacturers' responsibility. These days, retailers call the shots. This power and control is partly the result of high levels of industry concentration that have given Australia the most monopolised retailing sector in the western world. In other words, manufacturing suppliers are heavily dependent upon the orders of one or two key retailers.

However, this retail control is also part of a conscious corporate strategy on the part of large retailers designed to pull manufacturers closer into the retailers' attempt to respond quickly to market changes. Thus, retailers lie when they claim that they have no responsibility over what happens once they place a clothing order.

So, retailers do appear to wield the power to dictate quality and price, but how much knowledge do they have about their suppliers' operations?

FACT 3: RETAILERS ARE AWARE OF WHAT HAPPENS ONCE THEY PLACE AN ORDER

This is the central question when it comes to any responsibility retailers have over homeworkers' pay and conditions. Through the use of sophisticated informational and organisational technologies such as Electronic Data Interchange, Quick Response, shorter lead times and stock replenishment systems, retailers have been tightening the noose on clothing manufacturers over the past decade. In addition, all major retailers claim that they quality audit their suppliers to ensure the products meet their standards.

Yet, surprisingly, given this interest in quality control, few retailers claim to have any detailed knowledge of the extent of their suppliers' subcontracting chain, and whether their suppliers employ homeworkers. Most retailers will shrug their shoulders and state 'we're limited to what we can do', or 'we tend not to get involved at that level', or 'We don't know if they use outwork - our suppliers handle that for us'.

So, there is a peculiar tension in claims by retailers over their desire for control (over suppliers) and the acknowledgement of responsibility (to consumer expectations, to government regulations and to the homeworkers they ultimately employ. The only conclusion I can draw from this is that retailers have the potential to play an important role in monitoring work practices. If their claims to monitor the quality of their product is to hold any weight, then they must be able to verify or monitor how, where and by whom the product is made. All that seems missing is the willpower!

So, when they claim that they have no control over their supply chain, they are either liars or hypocrites! Either way, it is up to the public as consumers to ensure that retailers recognise that it is morally unacceptable to have control without responsibility. And this is the principal reason why we demand that they accept the monitoring procedures developed by the Homeworkers Code of Practice.

This demand that we are making that the ARA support the Code of Practice is hardly radical! This is also a call made by no-one other than that bastion of neo-liberal orthodoxy - The Industry Commission! Recommendation 7 made by in the Industry Commission's 1997 report on the clothing industry stated: 'The TCF industries should continue the process of implementing voluntary agreements and the Code of Conduct with retailers and government agencies to promote adherence to legal minimum payments and employment conditions for homeworkers'.

So, to sum up what I've said - the power to dictate type, quality and price of clothing has accrued more and more to retailers over the past decade. This has led to the recognition among a wide range of groups that there is a need to establish an industry-wide consultative council to oversee a Homeworkers Codes of Practice. Retailers must be involved in any attempt to improve homeworkers' wages and conditions because they are ultimately responsible for placing clothing orders. And if the ARA refuses to become part of the voluntary Code of Practice, then we as consumers need to fight for greater government intervention to ensure that homeworkers receive a fair wage and working conditions that are deemed acceptable by the community.