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Evaluating Ethical Workplace Standards:

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Evaluating Ethical Workplace Standards: Dr Alex Hughes and Dr Kanchana N. Ruwanpura Corporate and Public Sector Workwear from Karachi, Pakistan – PowerPoint PPT presentation

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Title: Evaluating Ethical Workplace Standards:


1
Evaluating Ethical Workplace Standards
Dr Alex Hughes and Dr Kanchana N. Ruwanpura
  • Corporate and Public Sector Workwear from
    Karachi, Pakistan

2
Outline
  • Ethical trade in supply chains for health sector
  • Aims and scope of study in Karachi, Pakistan
  • Codes, standards and initiatives implemented by
    the supplier in Karachi
  • Implementation of ETI (Ethical Trading
    Initiative) Base Code successes and challenges
  • Areas for further work recommendations to
    supplier

3
Ethical trade in supply chains for health sector
  • Long-standing academic, media and public
    attention to ethical sourcing
  • Recent attention to public (including health)
    sector
  • Media attention
  • Ethical Procurement for Health (EPH) workbook
  • ETI (Ethical Trading Initiative) training courses
  • NHS Sustainable Procurement Forum

4
Aims and scope of study in Karachi, Pakistan
  • Production of uniforms for UKs health sector
    workers
  • Scoping study 5th-8th December 2012
  • Collaboration with UK-based work-wear supplier,
    Dimensions, and Universities of Newcastle and
    Southampton
  • Study aimed to evaluate the effectiveness of
    ethical trading codes applied to a first-tier
    manufacturing supplier of uniforms in Pakistan

5
The first-tier supplier and Karachi-based
factories
  • Total sales turnover of first-tier supplier USD
    350 million
  • 7 factories in gloves division and 3 factories in
    clothing division
  • 3 clothing production facilities in Karachi
    produce wide range of workwear for European
    clients including uniforms worn in the UKs NHS
  • 3 clothing factories in Karachi
  • Factory A based in the Export Processing Zone
    (EPZ)
  • Factory B in Karangi (outside the EPZ)
  • Factory C in North Nazimabad

6
Study objectives
  • Objective 1 To establish which ethical
    codes/standards/initiatives are used by this
    supplier.
  • Objective 2 To evaluate the ways in which the
    ETI Base Code, as the code covering labour
    standards in the suppliers factories, is
    implemented.
  • Limitation Interviews with management only

7
Codes, standards and initiatives implemented by
the supplier
  • Supplier group compliant with ISO 90012008
    (achieved against backdrop of developments to
    improve production efficiencies (lean
    implementation)
  • Materials suppliers accredited against same
    Quality Management Systems standard ISO
    140012004 for Environmental Management Systems
  • Oeko-Tex Standard 100 certificates held by
    fabrics suppliers
  • Groups factories work with numerous
    environmental, health and safety initiatives

8
Implementation of labour standards
  • Supplying group signed up to ETI Base Code and
    SEDEX (the Supplier Ethical Data Exchange)
  • 2011 and 2012 audits and compliance (STR and
    SERCURA)
  • 2 other significant programmes of corporate
    social responsibilty affecting workplace
    standards
  • ILO pilot project for Promoting Gender Equality
    for Decent Employment
  • United Nations Development Programme (UNDP)
    GEN-PROM project on Gender Promotion in the
    Garment/Clothing Sector through Skill Development
    (supplier participating since its inception in
    2007)

9
Ethical Trading Initiative
  • ETI BASE CODE
  • 1. Employment is freely chosen
  • 2. Freedom of association and the right to
    collective bargaining are respected
  • 3. Working conditions are safe and hygienic
  • 4. Child labour should not be used
  • 5. Living wages are paid
  • 6. Working hours are not excessive
  • 7. No discrimination is practised
  • 8. Regular employment is provided
  • 9. No harsh or inhumane treatment is allowed

10
Implementation of ETI Base Code successes and
challenges
  • 1. Employment is freely chosen
  • - Management said that documentation collected
    for employment purposes is returned to the worker
    with only photocopies of relevant formal
    documents kept with the company. Workers have
    freedom to leave employment at his/her
    discretion, ideally with the formal period of
    notice given.
  • 2. Freedom of association and right to collective
    bargaining respected
  • - Weakly upheld globally
  • - Union activity prohibited in EPZ
  • - Worker Councils meet every 3 months (low no.
    of worker reps and ad hoc selection, 1 woman on
    the council even though women workers are the
    majority and active recruitment of women is a
    stated goal for the company)
  • - Room to raise more awareness of workers
    rights with respect to ETI Base Code

11
Implementation of ETI Base Code (cont.)
  • 3. Working conditions are safe and hygienic
  • - Against the backdrop of factory fires, these
    suppliers have taken important strides to
    emphasize this code to workers.
  • - However, EPZ-regulations permit factories for
    vertical expansion without building planning
    permission. Potential hazard as fire exits were
    not followed.
  • 4. Child labour should not be used
  • - Policy of hiring workers at no less than 16-17
    years or older is best to aspire to.
    Inconsistencies in Pakistan labour laws offer
    possible loopholes for evasion of global concerns
    around the non-use of child labour.

12
Implementation of ETI Base Code (cont.)
  • 5. Living wages are paid
  • - Monthly salaries (PKRs 8,100 to PKRs 10,600)
    meet minimum wages set by Pakistani authorities,
    but do not meet living wage aspirations of the
    ETI Base Code
  • - Pakistan Institute of Labour Education
    Research (PILER) in 2009 and in relation to the
    Asia Floor Wage campaign estimated the living
    wage for Pakistani workers to be at PKRs 12,000
  • 6. Working hours are not excessive
  • - No work after 5.00 pm, and it appeared that
    workers clocked off at the noted time
  • - Yet, discrepancies in management accounts
    suggest that overtime may in fact be in use.
    While overtime is permitted according to
    Pakistani labour law and similar allowances are
    made by the ETI Base Code (up to 12 hours per
    week), the need to pay workers for overtime was
    emphasized in our feedback to them.

13
Implementation of ETI Base Code (cont.)
  • 7. No discrimination is practised
  • - Non-discriminatory practices according to the
    ETI Base Code are defined as no discrimination
    in hiring, compensation, access to training,
    promotion, termination or retirement based on
    race, caste, national origin, religion, age,
    disability, gender, marital status, sexual
    orientation, union membership or political
    affiliation
  • - UNDPs GEN-PROM programme efforts to recruit,
    train and upgrade skills of women
  • - But, growing unemployment amongst men
    prompting UNDP to review its programmes and to
    include male workers

14
Implementation of ETI Base Code (cont.)
  • 8. Regular employment is provided
  • - Regular employment provided to workers
    following required laws with regard to this
    clause. Usually it was the workers who left their
    workplaces with inadequate notice given or
    because of unexpected social problems.
  • 9. No harsh or inhumane treatment is allowed
  • - During our short visits to the 3 factories, no
    visible problems.
  • - Managers emphasized need for positive work
    context and placed emphasis on affirmative
    working relationships.
  • - Leads to a positive image for suppliers
    ability to recruit workers, i.e. workers come
    looking for work because of its standing as a
    reputable employer.

15
Areas for further work recommendations to
supplier
  • 1) Management focus much more on quality and
    environmental issues than labour. Suggest balance
    between all areas.
  • 2) Variation in management awareness of labour
    laws. Knowledge could be checked and improved.
  • 3) Scope to develop initiatives for raising
    worker awareness of labour codes and rights and
    responsibilities in workplace. Images or
    cartoons can be used to enhance worker awareness,
    so that workers irrespective of their literacy
    levels are made aware of workplace rights.

16
Areas for further work recommendations to
supplier (cont.)
  • 4) Feedback boxes should be located in places
    easily accessible to workers away from management
    supervision, such as a canteen area, locker
    spaces, outside of production floor, etc.with
    culturally-sensitive images. Workers should be
    encouraged to offer feedback. Even where worker
    feedback may not be offered in a constructive
    spirit, management should be trained to listen
    and respond to workers.
  • 5) Composition and meeting frequency of, and
    selection procedures for, Worker Councils could
    be improved. The company should consider monthly,
    rather than quarterly, meetings as well as
    consider larger worker representation in the
    Councils.

17
Areas for further work recommendations to
supplier (cont.)
6) Continue collaboration with UNDP. GEN-PROM
programme a success and played vital role in
skills upgrading empowerment of women workers.
UNDP work evolving rapidly and entering new
stages. It recognizes balance between women
workers increased participation in the workplace
and it not becoming a tool for discriminating
against men seeking similar employment.   7)
Room to consider more engagement with NGOs (e.g.
PILER) to improve areas such as payment of living
wage effectiveness of Worker Councils. European
buyers increasingly emphasise the value of input
from local NGOs in supporting developments in
workplace standards.
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