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Detail on Workers Rights

Wages

In 2006, Pentland said that, “the minimum wage is not a living wage in any country. However in many countries it is subject to a tri-partite negotiation between employers, trade unions and government and we need to respect this process.”

It told us it was, “very rarely in a dominant position in the factory and to negotiate higher than the general market rate for wages would be impossible without agreement from the other customers.” We noted that its new brochure, “Ethical Sourcing the Pentland Way”, said that, “our policy is only to do business with suppliers that adopt and implement our standards or have their own policies that reflect the same standards.” Taken together, we said, these two statements imply that payment of a living wage is not a criteria on which sourcing decisions are made.

In 2007, Pentland responded that,

We acknowledge that new worker wages will probably remain at minimum wage level for the forseeable future in many factories. However we consistently discuss with management the following issues:

- cost of living (we visit if possible migrant workers housing units)
- the need to reward workers for staying around
- to establish criteria for promotion and training.
New workers are usually young and unskilled.

Freedom of Association

In 2006, Pentland told us that many of its factories do have unions or workers committees, but that,

Frequently these do not work very well to serve the interests of workers and we encourage factories to hold elections, make the union more visible, clarify its constitution, hold regular meetings etc. In China, where the union is not independent, few factories have unions and we have held workshops in four factories to see if more effective channels of communication can be established. We have also conducted training with the ACFTU on Codes and CSR. In all factories we encourage the factory to inform workers by way of notices and staff handbook of their rights under the law.

It also pointed out that it was not in a position to educate workers itself, but that it sits on a large number of multi-stakeholder committees, and, “we are producing a series of booklets with the Guangdong Department of Labour for managers and worker on their rights and responsibilities. We participated in the Sri Lanka ETI project which produced booklets for workers.”

In 2007, it added that,

We worked with Next on the Sri Lanka ETI pilot and were the first to use a local NGO for worker interviewers - in fact within a year of our initial work the JCC was negotiating wages – collective bargaining!

We said in 2006 that Pentland’s response suggested a misunderstanding of what constitutes a free trade union with real collective bargaining, as the ACFTU is not a free trade union. We noted that its brochure did not mention trade unions, even though it contained a section on worker representation. Furthermore, we said, its response leant heavily on using written material to educate workers, rather than the face-to-face training that is really necessary.

Pentland responded in 2007 with much more information on the booklets, and added that,

We work with what we find. We strengthen what is there and encourage the establishment of representative structures if there is nothing. The ultimate choice has to be left to workers.

Monitoring and verification

Pentland said in 2006 that,

[W]e do not use third party auditors...Ideally reviews are conducted in co-operation with local health and safety personnel, to ensure local standards are applied, that there is the possibility of follow up by qualified personnel and that training links are established...All reviews include some worker interviews, conducted by a range of contacts through the International Labour Office, local universities, local NGOs and local research institutions. Interviewers are often women experienced in talking to workers in a sensitive way. Where there are unions, worker representative groups and health and safety committees we include them in the process and at the final meeting.

We noted that Pentland’s brochure implied a conscious choice to compromise in the auditing process:

We accept that off-site interviews [with workers] might yield more information but it could affect our relationship with management and therefore compromise our ability to find sustainable solutions.

We said that the representative nature of the local partners with which Pentland works is ambiguous, based on the list it supplied in its response on freedom of association. It was also not clear how much involvement representative organisations had in audits.
In 2007 it responded that,

We told you that we consistently include H&S committees, union committees, joint consultative committees in our reviews of suppliers. This is not just in the final meetings, we have separate meetings with all of these, conducted by worker interviewers from NGOs/universitites etc. [...]

In three projects where we have worked with others, our methodology has been proved. It is not perfect, we need more time with suppliers, we need a more consistent trading relationship, we need more worker interviewers, we need more customers to do this who are willing to work together.

Our conclusion

Pentland’s response was a challenging one. It does have some interesting things to show, but it also seems to be in denial about the cost of living for workers. Many workers and their families are living well below the poverty line on legal minimum wages that Pentland thinks we should ‘respect’. Through its participation in ETI working group projects, Pentland has demonstrated that it is in a position to improve wages, if not on its own then in collaboration with others. If that collaboration is lacking, the obvious response is to initiate it.

It also seems that Pentland has not fully understood the nature of true worker representation, and so we are concerned that few workers producing for it are actually in a position to form, join and bargain through representative unions of their own choosing. It would have been nice to have further detail as to how it ‘encourages’ factories on this issue.

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Last Updated ( Thursday, 13 September 2007 )

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