The fashion giants guilty of ‘living wage’ shame

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Australians buying clothes this Christmas and in the new year are being urged to consider who made the items and how much they were paid.

Oxfam’s Shopping A Bargain report criticises major retailers such as Best&Less, Big W, Kmart, Cotton On and Myer for contributing to poor wage and labour practices.

Oxfam Australia CEO Lyn Morgain told businessinsider.com.au that shoppers “should demand big brands end this cycle and do better in the way they do business”.

“The research reveals unfair purchasing practices are pressuring factories into adopting poor working conditions and paying unacceptably low wages,” she said.

“It found that these poor purchasing practices of brands are making it impossible for factories to increase wages, despite many of the same brands making public commitments to ensure the payment of living wages. Instead, wages are trapping workers – mainly women – and their families in a cycle of poverty.”

The report says manufacturers are put under intense pressure by “aggressive price negotiation, inaccurate forecasting of orders, late orders, short lead times and last-minute changes to orders”, resulting in poor working conditions and low pay for workers.

It also found brands “rated themselves higher than their factory partners would, indicating a failure to understand the impact of their behaviour”, according to insideretail.com.au.

“Mosaic Brands and the Just Group were labelled the worst performers overall, while Best&Less seemed to have the largest discrepancy between its own rating and its factory’s rating. Additionally, the report found that product prices do not necessarily equate to more sustainably made products or more ethically treated workers, with Myer’s more expensive clothing falling short of H&M’s more affordable wares on both accounts.”

The Oxfam research, conducted with Monash University, examined 10 top Australian fashion retailers with workers in Bangladesh using 150 surveys and 22 interviews with factory owners, workers, union leaders, NGOs and brand representatives.

More than 80 per cent of Australia’s $22 billion fashion industry relies on products made in nations such as Bangladesh, India, China, Indonesia and Vietnam. Approximately 80 per cent of workers in those factories are women.

In 2017, Oxfam’s What She Makes campaign revealed that in the average supply chain of Australian garment retailers, only 4 per cent of the price of a piece of clothing is paid as wages to workers.

“That is just 40 cents from a $10 T-shirt. In countries like Bangladesh, where wages are extremely low, the situation is even direr,” the Oxfam report said. “An average of just 2 per cent of the price we pay in Australia goes towards factory wages. That means just 20 cents out of the price of a $10 T-shirt.”

Oxfam argues that paying living wages is easily achievable.

“Even if big companies passed the entire cost of paying living wages to all workers on to consumers, Deloitte estimates this would increase the price of a piece of clothing sold in Australia by just 1 per cent. That is just 10 cents extra for a $10 T-shirt. With profits being made at the factory, wholesale and retail levels in garment supply chains, there is room for big brands to absorb these costs without passing them on to the people who buy their clothes.”

In Bangladesh, the local minimum wage equates to just 39 Australian cents an hour. In Vietnam it is just 64 cents and in China it is 93 cents.

“While these workers remain entrenched in poverty, chief executive officers (CEOs) continue to take home massive payments and many big brands are increasing their profits,” says Oxfam. “There is perhaps no starker example of the growing global inequality crisis than the garment industry, where millions remain trapped in poverty on one hand, while a few amass great wealth on the other.”

Oxfam estimates that it would take a Bangladeshi garment worker earning the minimum wage more than 4000 years to earn the same amount that Australian CEOs get paid in one year.

Do you consider workers when you buy clothes? Are you happy to pay a little more if it helps provide a living wage for a worker in another country?

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Written by Will Brodie

12 Comments

Total Comments: 12
  1. 0
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    Can’t see big brands/retailers adding just 10cents to a piece of clothing. Put another zero on the end. $1.00 is more like it.

  2. 0
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    by far the biggest majority of clothes made in these countries is of very poor quality, I am sorry to say. So the companies involved are avariciously greedy. also when will they realize that a lot of todays fabrics are very uncomfortable to wear in Australian summer heat. very good that you are trying to make us aware of the situation.

  3. 0
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    considering what they all including millers are charging for their clothes and the crap quality they can afford to pay what they should

  4. 0
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    “Oxfam estimates that it would take a Bangladeshi garment worker earning the minimum wage more than 4000 years to earn the same amount that Australian CEOs get paid in one year.”

    What a ridiculous comment!

  5. 1
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    I would like to see all businesses stop buying from China full stop! I am making this point at every opportunity. I know we are small and they are big but their bullying here, in Hong Kong and elsewhere cannot be allowed to continue. Hopefully like minded countries will join together. China is reliant on trade. There are plenty of examples in history of powerful, corrupt regimes failing. China with all its power is petrified of democracy.

    • 1
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      Completely agree, it’s a pity we can’t get other countries to join together and put a trading block on China, the US are always stating that they support Australia as one of their loyal allies, time to put up or shut up, Europe should also step in and refuse to trade with China, if we can get the rest of the world to step up and stop the bullying tactics by China we might get somewhere, it took a long time to get apartheid abolished in South Africa the same tactics might work in pulling China into line. Unfortunately greed will take a big part in sorting China out, so I won’t be holding my breath.

  6. 0
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    Measuring wages by western standards can be fraught with problems. Some years ago we were in Bangkok when the “Karens” of the world were moaning about Nike’s huge markup on products made by “slave” labour overseas getting paid a pittance. During a conversation with the concierge, she mentioned that the locals were upset because the Nike factory had closed down. Apparently each morning there was a line halfway around the block of people wanting to work there because they were paying almost 3 times the local wage for similar work.

    Sure, almost 3 times the local wage in Bangkok may not buy much in Sydney or New York but it was a very good wage in Bangkok. The result of the “Karens” demonstrations to stop “slave” labour was a drop in profit for Nike and the loss of many well paying jobs in Bangkok. Perhaps those wanting to do good for third world countries should start by making themselves aware of what is actually happening in those countries.

  7. 0
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    Put a stop to trading with China. What a great idea. Now tell me about the loss of jobs around the world and the stockpiles of coal, grain, meat, minerals, iron ore and everything else that China buys. I am tired of reading to stop China. Yes they are big and need to be pulled into line but stopping everything immediately is not going to work. The manufacturers that are producing from China and go to other countries and ask them to produce their goods. Those countries will then import our required minerals etc. That will stop mass goods from being removed from shelves, jobs lost here because we do not export to China anymore. It needs to be done sensibly a step at a time not all gungho and stuff anybody who gets in the way. China is a force not to be upset.

    • 0
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      We could stop China dead. Just ban iron ore exports. There is no other country or group of countries that could fill the gap and China is dependent on our iron ore. No politician has the guts to try it. They’d have to stop bullying Australia immediately or watch thousands of industries close down.

      They’d be buying our grain and wine in no time just to get the steel they need so badly. You only need to travel around China to see how dependent they are on this commodity.

    • 0
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      I am not saying we stop everything overnight but we need to start somewhere. Where there are alternatives even if a bit more costly we need to move where we can. I also wrote my piece before the disgusting tweet about the soldier in Afghanistan. China to stand up and complain. Australia has had the openness to investigate this. Would China do this? What a joke. Tiananmen square? Dare not talk about that in China. Don’t talk about Urghurs either. Hong Kong?

  8. 0
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    This is a difficult situation. I try to not over buy and buy sustainable clothing made from natural fibres and Australian made wherever possible. However, it is more expensive. That is the dilemma for many. If I buy cheaper clothing, I try and keep them as long as possible. The problem is the demand for ‘fast fashion’ where we buy lots of garments which quickly go to landfill. If we bought less, the demand would drop but not sure that the workers would be paid more. At least they have employment which many others in poorer countries don’t.

  9. 0
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    I am all for everyone getting a decent wage — no matter where they are — and it is about time WE started making our OWN clothes and also everything else — it would mean more jobs and we would gain independence.
    Even trains and such — at least they would fit through our tunnels etc — unlike the rubbish that we paid a heap for and are of no use!


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