Consultation on a Proposal to Verify Labour Standards in the Apparel Industry - Outcomes and Recommendations

Recommendation and Alternatives

The purpose of the Public Policy Forum consultation was to bring forward a recommendation to the Competition Bureau on behalf of the Government of Canada, and to identify alternative directions both for the federal government and for stakeholders in the ongoing process of promoting fair labour practices and standards. This section outlines the PPF’s final recommendation and the alternatives for further action that emerged from the multi-stakeholder session.

 

Recommendation to the Federal Government

The federal government should not proceed with the proposed changes to the Textile Labelling Act.

Although the Public Policy Forum recognizes the level of genuine interest on the part of all stakeholders in promoting fair labour practices in the apparel industry, our recommendation to the Competition Bureau of Canada is that the federal government should not implement the proposed changes to the Textile Labelling Act. This recommendation is predicated on three key observations:

 

i.  There was no agreement among stakeholders that the proposed approach to disclosure would be useful or fair;

ii. The promotion of fair labour practices is a broad goal that involves all sectors; it should not be dealt with in isolation or by using a public policy vehicle that was not intended for that purpose;

iii. The technical difficulties that were identified with implementing the proposal, including the difficulty of gathering the required information and ensuring its timeliness and accuracy, strongly suggest that the expected benefit in terms of allowing consumers to make more informed purchasing decisions would be unlikely to materialize.

In summary, if the federal government chooses to continue to explore the issue of disclosure in some form, the Textile Labelling Act is not the appropriate policy tool.

 

Alternatives that Received Broad Support

Over the course of the project, a number of alternatives were identified which received a broad level of support from many stakeholders.

 

1.   What the federal government can do

 

i) In the domestic context

 

Some of the suggestions for alternative actions that could be undertaken domestically by the federal government in conjunction with interested stakeholders included:

 

·  Promoting or encouraging ongoing multi-sectoral dialogue on issues relating to ethical sourcing.

·  Ensuring that fair labour standards are applied in Canada.

·  Providing incentives for transparent reporting on Corporate Social Responsibility (CSR) initiatives through vehicles such as:

o     Procurement policy - based on the implementation of best practices in the ethical sourcing of goods.

o     Tax Policy - providing incentives for open and transparent reporting on CSR-related activities.

o     Financial Support - giving preference in the awarding of loans, grants, overseas investment insurance and other benefits to companies that have adopted codes of conduct that are consistent with ILO core conventions, that are using credible third-party auditors to verify compliance with those standards, and that are making public summaries of all audit reports and corrective actions taken.

· Engaging citizens in the issue of ethical sourcing in order to better determine their level of interest and willingness to support ethical trading initiatives. There was also broad-based support for the government to encourage or facilitate programs to educate the public about issues relating to ethical sourcing and fair labour practices. Stakeholders suggested that these goals might be achieved through the creation in Canada of an organization similar to the Fair Labour Association.

ii) In the international context

 

There is strong support from all stakeholders for the Canadian government to enhance its multi and bilateral efforts to encourage other countries to enforce international labour standards (such as those identified by the ILO). Some of the activities suggested include:

 

·      Linking access to the Canadian market to compliance with basic labour standards;

·      Supporting the protection of labour standards in multilateral trade agreements;

·      Working with bilateral trading partners to help develop and implement appropriate and effective mechanisms to support basic labour rights; and

·      Creating an organization like the FLA, as previously suggested, to help identify and promote best practices in encouraging and enabling fair labour practices both domestically and internationally.

 

 

2.   What stakeholders can do

 

All stakeholders expressed an interest in continued dialogue on the issue of ethical sourcing, on the condition that the dialogue be constructive progressive. Some of the issues that were identified for continued exploration included:

 

·      Ongoing work on the issues of transparency and accountability; and

·      Discussion (bilaterally and multilaterally, both within and across sectors) around the options - other than mandatory disclosure - introduced by ETAG at the session (Annex IV), including:

 

o Social reporting regulations;

o Incentives;

o Labour standards provisions in bilateral and regional trade agreements; and

o Support for capacity-building projects.

 

Stakeholders expressed interest in continued bilateral dialogue within the retail and apparel industry on non-competitive issues such as the sharing of factory audits. A willingness was expressed to involve certain NGOs in this process on an ongoing basis.

Table of Contents I Annex I