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Phasing out of MFA and its Impact on Workers . 1 Background. Better Factories. What is it? Anyone heard of it? 5 mins brainstorm. Cambodia. 13 million people 260 000 workers 80% of Cambodia’s exports 230 factories 70% owned by Chinese speakers 70% exports to US

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Presentation Transcript
better factories
Better Factories
  • What is it?
  • Anyone heard of it?

5 mins brainstorm

cambodia
Cambodia
  • 13 million people
  • 260 000 workers
  • 80% of Cambodia’s exports
  • 230 factories
  • 70% owned by Chinese speakers
  • 70% exports to US
  • Per capita income is US$27 per month
  • Average garment wage = US$72 per month
  • Directly supporting 1 million people
  • 30 – 50% salary sent home to family
objective
Objective
  • Increased firm level compliance with Cambodian and international labour law

= better working conditions for workers

= reduce poverty

= win:win:win:win

background
Background
  • 1999 US Cambodian Trade Agreement
  • Quota access for compliance
  • Possible 18% increase
  • ILO executing agency to monitor and report
  • Project January 2001
  • USDOL funding, GMAC, Govt
  • Govt links export license to registration with the project
discussion point
Discussion point
  • Why do you think that the project was controversial when it started?
description

Description

overview

remediation cycle
Remediation cycle

Capacity Building

Suggestions

role of unions
Role of unions
  • Members of PAC
  • Mainstreaming social dialogue
  • Monitoring
  • Training
  • Resources
  • Direct support
video

Video

discussion point

List things you want to know or discuss

monitoring

Monitoring

How it works

monitoring13
Monitoring
  • 6 teams
  • unannounced visits
  • Agreed checklist over 500 items
  • interviews management, workers and unions
  • Falsification checking
discussion point14
Discussion point
  • Contact with auditing firms?
  • Do they talk with union leaders?
  • Impressions?
monitoring reports
Monitoring reports
  • 15 synthesis reports
  • Each factory given a report
  • Buyers can request reports
  • Monitoring plus
  • Factories named
  • independent, transparent and credible
key aspects of the labour law
Key aspects of the labour law
  • Handout – see fact sheet about the industry
  • Discussion point – how does this compare to factories in your country?
key findings
Key findings
  • Handout 1
  • Discussion point – how does this compare to factories in your country?
supplementary research
Supplementary research
  • Harassment
  • Personal security
  • Health and OSH
  • Breastfeeding
  • Dispute resolution
world bank survey of buyers on labour standards
World Bank Survey of Buyers on Labour Standards
  • #1 for deciding to source from a country
  • Cambodia #1 compared to competitors
  • 60% - labour standards equal or more important that price, quality and lead times
  • 86% - moderate to critical importance to consumers in the future
  • ILO monitoring highly credible
  • See fact sheet
post quota
Post quota
  • See fact sheet
  • Still early days
  • Buyers consolidating
  • Price, quality, lead times and compliance
training

Training

approach

role of unions22
Role of unions
  • Training reference group
  • Joint training
  • Offer separate support to unions
  • Tri-partite delivery in some training
  • Mainstream social dialogue
all better factories cambodia training is
All Better Factories Cambodia training is:
  • Usually joint management and union
  • Adult-centered
  • Action-based
  • Conducted in a safe and supportive environment
  • Multi-lingual (depending on target group)
different levels
Different levels
  • Modular training
  • Single issues
  • Induction training
  • Factory based training
modular
Modular
  • 20 factories
  • 7 modules (Globalization, Workplace Cooperation, Quality, OSH, Productivity, HR and continuous improvement)
  • PICC
  • Factory action plans
  • 2 plus one training
  • Document
outcomes of trial
Outcomes of trial
  • Case Study
  • Currently tracking indicators
single issues
Single issues
  • Modules offered separately
  • Working time
  • Induction training skills
  • First aid
  • Sexual harassment
kit for hr managers
Kit for HR managers
  • 15 minute video
  • Comic books
  • Training kit
  • Train HR managers
factory based training
Factory Based Training
  • Targeted to young women with low literacy
  • Soap opera style
  • Supported by comic books
  • Tri-partite delivery
  • Show on TV
discussion point35
Discussion point
  • Positives and negatives of joint management/union training
  • Does training mean changed behavior?

Pairs and report back

resources

Resources

Making them available

industry post mfa strategy
Industry Post MFA Strategy
  • Market niche of good labour standards
  • Reduce corruption
  • Trade facilitation
  • Improve business environment
  • Improve quality and productivity
  • Improve skill levels
  • Increase Khmer management expertise

Labour standards is not enough

project strategy
Project strategy
  • Refocusing to providing info to international buyers to inform sourcing decisions
  • Increased emphasis on remediation
  • Reducing duplication of monitoring
  • Building business case
  • Self sufficient national organization by 2009
agreed sustainability strategy

handover

Current

Agreed Sustainability Strategy

transition

2004

2005

2006

2007

2008

2009

2010

lessons learnt

Lessons Learnt

Engaging with CSR

industry
Industry…

What matters is:

  • Price
  • Quality
  • Lead times
  • Compliance with labour standards
  • Innovation and whole service
context
Context
  • Improving working conditions key to pro-poor development
  • CSR and monitoring will grow
  • Monitoring is not enough
  • Must support freedom to organize and collectively bargain
buyers
Buyers
  • Engagement of buyers is critical
  • Not all buyers are the same
  • Important leverage point
  • Quality of buyer audits and engagement varies
  • Risks involved
progam design
Progam design
  • Independent, credible and transparent
  • Strong government and buyer support
  • Use local staff
  • Mainstream social dialogue
  • Incentives and enforcement
  • National or geographical approach
  • Tri-partite approach
  • Reduce duplication of monitoring
  • Engage with buyers and other stakeholders
  • Emphasis on training and improvement
  • Consider language
challenges
Challenges
  • Claiming too much
  • Monitor up to the factory gate
  • Corruption
  • Good governance and rule of law
  • Lack of tolerance of opposition
  • Freedom of press
  • Union corruption and division