Study of A Proposal (and its alternatives) to Amend the Textile Labelling and Advertising Regulations: Applying the Conference Board’s Optimal Policy Mix Framework

Appendix C: Additional Information About Selected Initiatives

Additional Information about Client-specific Codes

The Students Against Sweatshops groups mentioned in Chapter 3 of this report have been raising awareness, and groups in many provinces have started campaigns to pressure their schools and universities to adopt codes of conduct governing the production of clothing. The students report on their web site ( http://www.campuslife.utoronto.ca/groups/opirg/groups/sweatshops/sas-c.html) that they are actively campaigning for sweat-free campuses in 18 universities across Canada. The first Canadian code for trademark licensees was passed at the University of Toronto in the spring of 2000. As of July 2002, it is reported that licensing or purchasing polices had been adopted at eight Canadian universities (Alberta, Laurentian, Western, Guelph, Waterloo, McMaster, Toronto, and Dalhousie). Codes adopted by three of these universities, namely Western, Guelph, and Dalhousie, were reported not to be stringent enough by Student Against Sweatshops. On these campuses, students are mounting campaigns to strengthen the codes and expand the requirements. Codes are also under negotiation at three other universities: Trent, Queen's and Memorial.

The web site also describes the process followed by Students Against Sweatshops. To acquire the right to sell to "coded" universities, a supplier must agree to a purchasing policy with guidelines against forced labour, child labour, harassment or abuse, discrimination, and intolerable hours of work. Other guidelines support freedom of association, the right to bargain collectively, the right to fair wages and compensation, health and safety, employment relationships, and reproductive rights. In addition, the purchasing policy contract specifies that the code is to apply to all of the Supplier’s and Licensee’s contractors. Throughout the Code, the term "Contractor" includes each contractor, subcontractor, vendor, or manufacturer engaged in a manufacturing process that results in a finished product for the consumer or any component of a finished product. "Manufacturing process" includes creation, assembly, packaging, and decoration. Such codes are still relatively new and have yet to be fully tested. However, it is assumed that for the categories of apparel covered by the contracts the contracts are binding and the standards are in force.

Similarly, many Canadian cities are inserting ethical standards into by-laws that govern purchasing. The City of Ottawa already covers ethical purchasing in tender documents. The City of Toronto has created by-laws in which they specifically mention items such as:

• a fair wage policy (http://www.toronto.ca/fairwage/policy.htm);
• the purchase of products manufactured in factories where children are used as slave labourers or where there are other exploitative circumstances that impede the development of children²⁶ and
• the purchase of coffee (http://www.toronto.ca/index.htm).

For example, under the purchase of coffee provision, coffee for the City of Toronto must be purchased from sources involved in programs that make a positive difference in the lives of coffee farmers or that have received the Transfair/Fair TradeMark Canada label. Transfair Canada is described as Canada's only independent certification organisation for fair trade in coffee, tea, cocoa, and sugar.

Additional Information about the Workers' Rights Consortium (WRC) (United States)

The WRC is a non-profit organisation created by college and university students and administrators, and by independent labour rights experts, to assist in the enforcement of manufacturing codes of conduct adopted by colleges and universities. These codes are designed to ensure that factories producing goods bearing college and university logos respect the basic rights of workers. The following descriptions reproduce selected details of the initiative. More information about this initiative can be found at www.workersrights.org.

The web site reports that this initiative grew out of the anti-sweatshop campaigns of the United Students Against Sweatshops in the United States, as an alternative to the FLA's brand certification program. It states that the WRC does not certify brands or factories as being in compliance with the WRC Code or the codes of conduct of its member universities. Nor does the WRC accredit external monitoring groups or social auditing firms to carry out the investigations. Instead, the WRC conducts its own factory investigations in response to worker or third-party complaints, as well as on a proactive basis. In the United States, more than 90 colleges and universities are affiliated with the WRC and the manufacture of university licensed apparel products is a $2.5 billion business.

The WRC details a model Code of Conduct on the basis of which it will investigate its licensees. The Code has clauses that cover standards (wages, hours, overtime, child labour, forced labour, health and safety, non-discrimination, freedom of association, and women’s rights). There are also guidelines on compliance and disclosure, verification, labour standards, the environment and remediation. This initiative provides an example of a type of verification regimes that could be adopted in Canada as an alternative to the ETAG proposal. This initiative is a mirror image of the initiative of Canadian universities, colleges, and governments aimed at supporting the ultimate objective of ensuring fair labour standards in the production of apparel.

Additional Information about the Ethical Trading Initiative (ETI) (United Kingdom)

The ETI reports on its web site that it brings together NGOs, companies, and unions to identify and promote good practices in the implementation of codes of conduct, including monitoring and independent verification. Companies such as Anchor Seafood, Body Shop, Chiquita, Levis, NEXT, Marks and Spencer, Safeway Stores, Brooke Bond Tea, Tetley Tea, and Twinings are members.

The ETI has developed a multi-sectoral Base Code based on ILO standards. ETI member companies agree to adopt or incorporate the Base Code, and must require that their suppliers meet the provisions of that Code within reasonable time frames. ETI members are currently participating in four pilot projects, testing various models of code verification. The following reproduces selected description of the initiative found on the ETI web site. Further details of the initiative can be found at www.ethicaltrade.org.

ETI’s Base Code has the following requirements:

• freedom to choose employment;
• freedom of association and the right to collective bargaining;
• safe and hygienic working conditions;
• no use of child labour;
• payment of living wages;
• no excessive working hours;
• no discrimination is practised;
• regular employment is provided; and
• no harsh and inhumane treatment is allowed.

The web site reports that the ETI Base Code was the result of negotiations between trade unions, NGOs, and business in 1998. It is based on Conventions of the ILO, already mentioned in the body of the report.

Additional Information about The Fair Labor Association (United States)

The FLA Web site reports it is a U.S. non-profit organisation established in 1998 to protect the rights of workers in the United States and around the world. The FLA is reported to be the successor to the Apparel Industry Partnership (AIP), which was initiated by the White House in 1996 to address labour rights standards in the apparel industry. The FLA Charter Agreement presents an industry-wide code of conduct and monitoring system. The FLA accredits independent monitors, certifies that companies are in compliance with the code of conduct, and serves as a source of information for the public. Companies participating in the FLA include Adidas-Salomon, GEAR for Sports, Jostens, Inc., Joy Athletic, Levi Strauss & Co., Liz Claiborne, Nike, Patagonia, Reebok, Eddie Bauer, Phillips-Van Heusen, and Polo Ralph Lauren. More information about the FLA can be found on the organisation’s web site at http://fairlabor.org/.

The web sire reports that founding NGO members of the FLA include the Lawyers Committee for Human Rights, the National Consumers League, the National Council of Churches, and the Robert F. Kennedy Memorial Centre for Human Rights. Organisations affiliated with the FLA are represented by a Board of Directors that includes a chairperson, six representatives from human rights, consumer and labour rights groups, six industry representatives, and three college/university representatives. To date, over 170 U.S. colleges and universities have affiliated with the FLA.

Additional Information about the FairTrade Labelling Organization

The FairTrade Labelling Organization (FLO) is reported on its web site to be a non-profit, membership-based association of National Initiatives (17 members worldwide) who promote fair trade labelling in their national markets. They report doing this by:

• lobbying governments for support;
• negotiating with importers and retailers; and
• running education programs with the aim of supporting marginalized producers on the road to sustainable development.

The web site describes the initiative as follows. A label identifies FairTrade products so that consumers will buy them, giving FairTrade producers access international markets on fair terms. FLO reports that it sets standards and certifies producers while monitoring them regularly. By ensuring the FairTrade quantities sold by the producers under FairTrade conditions were equal to the quantities sold to the consumers under the FairTrade labels, FLO guaranteed the product was a FairTrade product. As long as manufacturers agree to buy from registered suppliers according to FairTrade criteria, products offered are allowed to carry a FairTrade seal of approval.

FLO is described on its web site as the only certification system in the world where producers do not pay for their certification. The consumer pays for the FairTrade system. Traders pass on to consumers the higher FairTrade price and the premium that is paid to producers for FairTrade products. The National Initiative in the country where the products are sold charge licensees a fee for using the FairTrade label. This pays for all of FLO's certification and monitoring costs and for the National Initiatives marketing expenses. Including the cost of the system in the retail price sustains FairTrade labelling.

FairTrade Products currently include coffee, drinking chocolate, chocolate bars, orange juice, tea, honey, sugar, and bananas. On sale in most major European supermarket chains, FairTrade products are now available to a much wider public, with some FairTrade products achieving 10 per cent of national market share. In Canada, the best known example is FairTrade coffee. FairTrade products do not currently include apparel, but the concepts used in FairTrade could be adapted to apply to apparel. Information about the FairTrade initiative can be found at www.fairtrade.net.

The web site reports that in 1988, the Netherlands became the first country to launch the FairTrade consumer guarantee. Today there are labelling initiatives in developed countries in Europe, North America, and Asia.

The FLO was reportedly set up in April 1997 to coordinate the work of a growing number of national initiatives and to run monitoring programs more efficiently. A central responsibility for FLO is to collect data and ensure the effective audit of all FairTrade-labelled products from the producer to the supermarket shelf. The web site suggests that national initiatives retain responsibility for marketing and promoting FairTrade in their respective countries. Because of its success with many products, FairTrade presents an interesting alternative to the ETAG proposal.

Additional Information about World-wide Responsible Apparel Production (WRAP) (United States)

The WRAP web site at www.wrapapparel.org. reports that the WRAP Factory Certification Program was launched in January 2000 by the American Apparel Manufacturers Association (AAMA). The web site contains requirements that ensure fair labour standards and includes clauses on:

• workplace regulation;
• prohibition of forced labour;
• prohibition of child labour;
• prohibition of harassment and abuse;
• minimum compensation and benefits;
• prohibition of discrimination;
• health and safety requirements;
• freedom of association; and
• environmental and customs compliance.

The Certification Program is said to be particularly rigorous. Its stages are:

• self-evaluation;
• independent review by certified evaluators; and
• final review by the WRAP Certification Board.

The site reports that appeal for U.S. apparel manufacturers is its less onerous standards and the fact that responsibility for seeking, paying for certification, and achieving compliance lies entirely with local factory owners, not with North American companies that contract out the manufacture of their products. As such, it shares the responsibility for fair labour standards with the producers.

WRAP is being heavily criticised by some stakeholders (including those ETAG stakeholders that participated in the Conference Board OPM process) for not going far enough or involving enough manufacturing sites. Nevertheless, it would appear that WRAP has been relatively successful since, as of October 2002, WRAP had 1,025 certified manufacturing facilities in 68 countries. For more information, please refer to www.wrapapparel.org.

Additional Information about Australia’s Retailers Ethical Clothing Code of Practice

The Retailers Ethical Clothing Code of Practice is an example of a law enacted by Australian state governments such as in New South Wales (NSW)) to support the code of conduct (described earlier under section 3.1.9). This law is designed to help provide a new tool for tracking the largely invisible workforce in Australia, from the top of the contracting chain down. The actual text of the NSW legislation is reproduced in Appendix E.

One of the key objectives of this law currently before the Australian state parliament is reported to be to help identify this important component of the Australian underground economy. It basically requires Australian retailers to take action when exploitation of home workers is uncovered in the process of complying with the Fairwear Homeworkers Code of Practice. The code provides a requirement for retailers to share with The Textile Clothing And Footwear Union of Australia (TCFUA) information from their commercial records related to clothing industry suppliers and contracts. The code is meant to apply to Australian workers only and does not cover those in other countries.

It is reported that the new Retailer Ethical Clothing Code will strengthen the Retailers' section of the Homeworkers' Code of Practice, which was seen as ineffectual. The Manufacturer's section of the Homeworkers' Code of Practice remains, with the standards manual and the No Sweat Shop label from the Homeworkers' Code recognised in the new Code.

The web site reports that key elements of the Code include:

• Retailers will provide the union with a full list of clothing suppliers within 14 days of signing the Code and every six months thereafter.
• On request, the union can access details of retailers’ individual contracts, including turnaround times for orders, the number of garments in the contract, a sample of the garment, and in some cases the price paid for the contract.
• Retailers undertake to end contracts where exploitation is proven and the problem has not been addressed by the supplier.
• The definition of exploitation includes the case where the retailer fails to fulfil obligations to suppliers under the Code, such as to provide the union with a timely lists of contractors. Such failures can constitute a reason for a retailer to end a contract with a supplier.
• Recognition of the Homeworkers Code of Practice Standards Manual for calculation of fair piece rates for outside workers working unsupervised at home.
• Recognition of the No Sweat Shop label with retailers undertaking not to discourage display of the label (Fair Wear would have preferred a commitment to encourage the label, but this was not forthcoming.

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²⁶ Please see the section on City of Toronto purchasing bylaw at http://www.city.toronto.on.ca/council_highlights/2000/highlight_000704.htm